Homegrown terrorists
How a Hezbollah cell made millions in sleepy Charlotte, N.C.
Hammoud seems an unlikely candidate to have run such a scheme. In his mid-20s, he appeared soft-spoken, almost shy. One cop described him as "a Dr. Jekyll-Mr. Hyde type" who came alive at weekly prayer meetings, rousing the faithful to contribute to Hezbollah. On weekends, he practiced the marksmanship he learned while in Lebanon. In July 2000, when federal agents arrested the group and searched Hammoud's home, they found hundreds of Hezbollah propaganda tapes, correspondence from top Hezbollah leaders, even receipts from Hezbollah for the money they had sent.
Hammoud and his followers were often ingenious. To avoid suspicion, they hired white women as ride-alongs and strapped bicycles to the back of the vehicles. Some members bought a gas station, using a fraudulently obtained loan guarantee of $1.6 million from the Small Business Administration, officials say. The men even considered taking out life insurance policies for Hezbollah fighters in the Middle East. But it is the group's sheer range of criminal activity that most struck investigators. Tobacco smuggling was only the most lucrative of their varied scams. "They're best described as part-time terrorists and full-time criminals," says FBI agent Rick Schwein, who ran much of the bureau's investigation.
Among their crimes, investigators say: bank scams, bribery, credit card fraud, immigration fraud, identity theft, tax evasion, and money laundering. Nearly all the key suspects had bogus marriages. Two of their "wives" were, in fact, lesbians who lived not with their paper husbands but with each other. The gang used so many identities that investigators had to dig through a mind-boggling 500 accounts to follow the money trail. Most of the crimes were too petty to garner police attention--and that was by design, officials believe. "Is it criminal activity? Yes," says Schwein. "But it's more. It's tradecraft."
The pattern is a familiar one to investigators. Terrorist groups are, at heart, criminal organizations. They rely on smuggling and laundered money, document fraud and front companies, and traffic in illegal weapons. Al Qaeda's Ahmed Ressam, who attempted to bomb Los Angeles International Airport in 1999, was part of an Algerian crime ring partial to credit card and bank fraud. Other terrorist groups are mired in drug dealing and kidnapping.
"A one-man crime wave." The scope of the Charlotte cell's criminal activity led prosecutor Bell to try a new tactic in the war on terrorism: He obtained indictments against the group under RICO, the antiracketeering law that has helped bring Mafia families to their knees. Bell's success has encouraged prosecutors across the country to employ the tough statute against alleged terrorists--most recently in last month's indictment of a former University of South Florida professor, Sami al-Arian, and seven others tied to Islamic Jihad. Indeed, the list of alleged crimes faced by that group reads like a Mob case: conspiracy to kill and maim, extortion, perjury, and obstruction of justice.
The son of a law professor, Ken Bell is credited with other breakthroughs in prosecuting the Charlotte cell. The case stands as the first successful prosecution using a 1996 antiterrorist law that bans "material support" to terrorists; it was under this law that Hammoud was convicted of funneling money to Hezbollah. Bell scored another apparent first by introducing into evidence records from a foreign intelligence agency--in this case, intercepts from the Canadian Security Intelligence Service, which provided damning evidence of cell members' calls to high-ranking Hezbollah officials.
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