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America's New War: Financing Terror

Aired September 21, 2001 - 05:50   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LEON HARRIS, CNN ANCHOR: It's a detective story but will there ever be a solution. Let's get some more now on the flow of funds to these terrorist organizations.

We check in now with Jeffrey Robinson. He's the author of "The Merger," which is an expose of the global network of money laundering and he is in London this morning.

Good morning, sir. Thank you for taking time to talk with us today.

JEFFREY ROBINSON, AUTHOR, "THE MERGER": Good morning, Leon.

HARRIS: I take it from some words that I've seen written about things that you've said that you don't believe that it's possible to change the international banking system enough to go ahead -- to counteract this money flow to these terrorist organizations. Is that true?

ROBINSON: You have to understand the people who could have an effect on money laundering -- the lawyers, the bankers, the accountants, the company formation agents, the brokers, the wire emitters -- all of these people are profiting by it. So the people who could do something about it have no real incentive to change the system.

HARRIS: So is there a way to change that -- the incentive system then?

ROBINSON: Well, yeah, there is. You can start looking for what's called the beneficial owner of the money. We have money laundering laws in the United States that are probably the strictest in the world and yet when a money laundering bill hit the Senate only a couple of years ago, Phil Graham from Texas, in the pocket of the banking lobby, killed it. Why? Because the banks don't want people looking into these accounts. The banks are making money by it. It's a disgraceful attitude.

Phil Graham, according to "The New York Times" yesterday said he would kill the next money laundering bill. I mean, this is awful. We have to understand that you follow the money.

These global terrorist organizations are simply corporations operating in various ways. The money's not hidden in a cave in Afghanistan -- it's got to circulate.

If you go after the money -- if you cut off the cash flow -- cut off the reinvestment -- you can bankrupt the bastards. When you bankrupt a business the product is off the streets. In this case the product is terror.

HARRIS: Well, let me ask you about that. I also read that same article you just mentioned and there was something in it -- as a matter of fact, I made a note of it -- something -- are you familiar with this system called Howala (ph), which means entrust? It's essentially . . .

ROBINSON: Yeah.

HARRIS: . . . what's being called a paperless underground banking system. Even if you address the problem with the legitimate banks that actually do transact things on paper what about this paperless system?

ROBINSON: Well, paperless to a point. The fact is there's still a money trail. Howala (ph) banking comes from that part of the world. It literally means underground money. It's a variation on something the Chinese invented, which was flying money.

What happens is somebody from that part of the world says, "I need money for my terrorist organization in the United States." They rely on an American-based organization to fund them -- perhaps a charity. It's well known that Mr. bin Laden has associations in the Balkans. There are all sorts of Albanian refugee charities in North America.

This money, which kind of slips through the money laundering laws because charities have special exemptions for cash, this money is made available to the terrorist network. It is paid back in the original region -- perhaps in the Balkans and Albania -- by money from, say, Afghanistan heroin.

And don't forget the Taliban are the biggest heroin dealers in Europe. Eight percent of European heroin comes directly from Afghanistan.

HARRIS: All right, I want to get . . .

ROBINSON: This is a big money operation.

HARRIS: Yeah, I want to get right to a couple of e-mails that we've got. We have a really good question here for you. I want to bring this one up first. I don't have a name on this one but it's -- I want you to see it if you can see the screen. I recently heard a report that the SEC was looking into allegations that bin Laden had money in the U.S. stock market and that they noticed certain stocks having big sell-offs just before the attacks. Is there any truth to that? Do you know?

ROBINSON: Well, there are -- there are investigations underway in Japan, the Japanese stock market in Germany. And Germany's a very interesting market because, again, these Albanian refugees have a number of big charities in Germany. There is a lot of Albanian money.

There is a direct link between Mr. bin Laden and the Albanians such as the KLA -- the Kosovo Liberation Army. Did somebody short sell these shares? If they did there's a paper trail some place. You just can't pick up the phone and call a stock exchange anywhere in the world . . .

HARRIS: Yeah.

ROBINSON: . . . and say, "Sell. I'll call you later to find out."

HARRIS: Yeah.

ROBINSON: You need a broker. There's a paper trail.

My bet is that a number of these people are not sophisticated enough to understand the genie they've now let out of the bottle in the United States -- not only the fury but also the skill of financial investigators to find the money.

HARRIS: It would be fortunate if your bet is a good one. All right, let me ask you this one last question here from another e-mail we got from Bill Earl in Anchorage, Alaska. It is reported that Osama bin Laden has a large amount of money at his disposal. Now here's the question -- will this money dry up for terrorist activity if bin Laden is removed from the equation?

ROBINSON: Well, there are businesses that Mr. bin Laden has been patron of through family interests in Sudan and Yemen. These are functioning businesses -- there are accounts, there is money, these are money trails that can be followed. One of them apparently leads to Cyprus. Cyprus is interesting because half of Cyprus is owned by Turkey. Turkey is an Islamic country with access to western banking.

Those money trails will be looked at. His business will be looked at. And if -- again, if you can get to the money -- if you can cut off the reinvestment, cut off the cash flow you can bankrupt the bastards and take the product off the street.

HARRIS: There's our headline this morning -- "Bankrupt The Bastards." Jeffrey Robinson -- I could talk with you all morning but unfortunately my boss says I can't. Thank you very much for your time this morning -- we appreciate it. And I hope to get a chance to talk with you again later on down the road. Take care.

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