Paying for Terror
How jihadist groups are using organized-crime tactics--and profits--to finance attacks on targets around the globe
Nor has Russia escaped the heroin boom's impact. From central Asia, growing amounts of Afghan heroin are entering the south of the country; drug-control officials report that large numbers of Russian military are on the take, even trucking the stuff in army vehicles. The level of corruption has, in turn, raised concern over the ultimate black market: in radioactive materials. Russia's "nuclear belt"--a chain of nuclear research and weapons sites--runs directly along those heroin smuggling routes. How bad are conditions in the area? Bemoans one intelligence expert: "We know so little."
Iraq, too, is starting to see its share of narcotics, but drugs are but a bit player in an insurgency that has also blurred the lines between terrorism and organized crime. Within Iraq's lawless borders exists an unsavory criminal stew composed of home-grown gangsters, ex-Baathists, and jihadists. "Terrorists and insurgents are conducting a lot of criminal activities, extortion and kidnapping in particular, as a way to acquire revenues," Caleb Temple of the Defense Intelligence Agency testified to Congress this July. Among the biggest cash cows: The insurgents take part in the wholesale theft of much of Iraq's gasoline supply, earning millions of dollars in a thriving black market. Extortion and protection are also rife, and kidnapping for ransom has ballooned into a major industry, with up to 10 abductions a day. Among those targeted: politicians, professors, foreigners, and housewives. Those with political value may find they've been sold to militants.
The insurgents are also key players in the graft and corruption that have enveloped Iraq. So much foreign aid money has disappeared that two U.S. intelligence task forces are now investigating its diversion to the insurgency, U.S. News has learned. Western aid agencies, Islamic charities, and U.S. military supply programs all have been targeted, analysts believe. Occupation authorities cannot account for nearly $9 billion of oil revenues it had transferred to Iraqi government agencies between 2003 and 2004, according to an audit by a special U.S. inspector general set up by Congress. "Even if a little bit ends up in insurgent hands," says one official, "it doesn't take a lot to build a truck bomb." The implications are troubling: The insurgents may be using America's own foreign aid to fund the killing of U.S. troops.
Back at home, U.S. officials are looking warily at the growing rackets of terrorist groups overseas and voice concern that the trend will grow here. "We see a lot of individual pockets of it in the United States," says Joseph Billy, deputy chief of the FBI's counterterrorism division. "Left unchecked, it's very worrisome--this is one we have to be aggressive on." Federal investigators have uncovered repeated scams here largely involving supporters of Hamas and Hezbollah, and they have traced tens of thousands of dollars back to those groups in the Middle East. "There's a direct tie," says Billy. The list of crimes includes credit card fraud, identity theft, the sale of unlicensed T-shirts--even the theft and resale of infant formula. Most of these U.S. rackets have been low level, but some, involving cigarette smuggling and counterfeit products, have earned their organizers millions of dollars.