Funding Terrorism in Southeast Asia: The Financial Network of Al Qaeda and Jemaah Islamiya

Abstract

Introduction war on terror has continued apace in Southeast Asia, and the governments in the region deserve credit for the arrests of some 150 Jemaah Islamiya (JI) members through April 2003. Several of the members of JI's regional shura (council) were arrested, including Mohammed Iqbal Rahman (Abu Jibril), Agus Dwikarna, and Faiz bin Abu Bakar Bafana. These arrests were significant, especially as the JI is not a large organization, with probably no more than 500 members. fact that they are now focusing on soft targets such as tourist venues rather than hard, though symbolic, targets may indicate institutional weaknesses, the result of 20 mouths of intensive investigations and arrests. They are less able to plan and execute terrorist attacks than they were a year ago, though they still maintain capacity to attack soft targets. That said, one would be foolish to underestimate JI's capabilities or goals. As many of the key operatives are still at large, the organization retains the capacity and will to launch devastating attacks throughout the region. glaring exception to the success in fighting terrorism has been on the financial front: mechanisms for funding terrorism have continued unabated in Southeast Asia, and to date no terrorist assets or funds have been seized in the region. Two leading members of Jemaah Islamiya, Hambali and Abu Jibril, had assets blocked by the United States under Executive Order 13244 on 24 January 2003 (18 months after Abu Jibril was arrested). Indeed, this is a worldwide problem: as of January 2003, only US$113 million in Al Qaeda-linked assets had been frozen. In early 2003, the U.S. Department of Treasury's Office of Foreign Asset Control drew up a list of 300 individuals, charities and corporations in Southeast Asia believed to be Al Qaeda and Jemaah Islamiya funders. Due to inter-agency politics, the list was winnowed down to 18 individuals and 10 companies. But even at the time of writing in early April 2003, the list was still unannounced due to diplomatic and bureaucratic pressure. Yet Southeast Asia seems to have gained in importance to Al Qaeda's money men, according to U.S. law enforcement officials. head of the terrorist financing tracking unit at the Federal Bureau of Investigation (FBI), asserts that, with the crackdown on Middle Eastern funding mechanisms, especially the financial centres in Abu Dhabi and other parts of the United Arab Emirates, Al Qaeda has increasingly relied on Southeast Asia to move its money and hide its assets. (1) Al Qaeda's financial network is very sophisticated and complex, dating back to the late-1980s to early 1990s. Osama bin Laden set out to establish an organization that would be self-sustaining over time; one part self-reliant, another part reliant on the ummah, the Muslim community. Built on layers and redundancies, Al Qaeda's financial backbone was built on a foundation of charities, non-governmental organizations, mosques, websites, fund-raisers, intermediaries, facilitators, and banks and other financial institutions that helped finance the mujiheddin throughout the 1980s. This network extended to all corners of the Muslim world. (2) The goal of counter-terrorism, according to Mathew Levitt, should be to constrict the environment in which terrorists operate, including their logistical and financial support networks, which denies terrorists the means to travel, communicate, procure equipment and conduct attacks. (3) This is arguably the most difficult part of the war on terror, as terrorist organizations use myriad ways to fund operations, legal and illegal, overt and covert, with paper trails or without. Tracking this funding was also never a priority for law enforcement or counter-terrorist officials--terrorist financing was always seen as ancillary to counter-terrorist operations, but never a primary agenda in its own right. How does Al Qaeda fund its operations in Southeast Asia? …