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America's New War: The Money Trail

Aired September 27, 2001 - 06:34   ET


LEON HARRIS, CNN ANCHOR: To learn more about Osama bin Laden, take a look at his finances. That's what the Senate Finance Committee is doing right now, and their search has led them to what they call a fraud riddled bank, which belonged to bin Laden, but was shut down 10 years ago.

Here now is CNN's Allan Dodds Frank.


ALLAN DODDS FRANK, CNN CORRESPONDENT (voice-over): At a Senate banking committee hearing, revelations that after the closure of a notorious money laundering bank hurt Osama bin Laden, he started his own bank. Senator John Kerry investigated the Bank of Credit and Commerce International a decade ago, and says Osama bin Laden had a number of accounts there.

SEN. JOHN KERRY (D), MASSACHUSETTS: We've learned since, through law enforcement and intelligence, that when we shut it down we dealt him a very serious economic blow.

FRANK: Senator Carl Levin highlighted reported relationships between western banks and the Al Shamal Islamic bank, a bank in Sudan believed to have been established by Osama bin Laden with $50 million in 1991.

SEN. CARL LEVIN (D), MICHIGAN: As of today, the Web site of that Sudanese bank shows that they still have correspondent banking relations with Western banks, including American banks. Now, we think the American bank accounts are either closed or no longer operative.

FRANK: The correspondent banks, 15 in all, operate in financial centers ranging from Germany, France and England to Indonesia, South Africa and China. Senator Phil Gramm, who last year blocked some tougher legislation, cautioned against laws that would allow treasury to freeze assets indiscriminately.

SEN. PHIL GRAMM (R), TEXAS: If a guy named Bobby bin Loden from Iran, Texas, has his assets frozen, then he has an opportunity on a timely basis to come forward and say, "I'm from Iran, Texas, my name's Loden. You made a mistake here."

FRANK (on camera): Senator Gramm notwithstanding, the mood on Capitol Hill almost certainly means a broad package of legislation governing banks, brokerages, money exchanges and other financial institutions will soon be passed.

Allan Dodds Frank, CNN financial news, Washington.


HARRIS: Author Jeffrey Robinson thinks authorities have little chance of shutting off the money pipeline to terrorists. His two books are eye-opening studies of worldwide organized crime and money laundering.

Jeffrey Robinson joins us this morning from London once again -- good to have you back. How are you?

JEFFREY ROBINSON, AUTHOR: It's always a pleasure. Good to talk to you, Leon. Hi.

HARRIS: Let's start off with the report we just saw -- Allan Dodds Frank's report about this BCCI bank that was shut down here in the United States, and even though it was actually started with terrorist money, if you will. Now, that really presents just how big this problem is, does it not?

ROBINSON: Does it indeed! BCCI was nothing but a toilet of dirty money. I mean, the whole thing was a money laundering sink. That was a bank that had more branches in Medellin, Columbia than, I think, any other city in the world. It was a real piece of work. It was a Pakistani bank that was invented to launder money.

The interesting thing about that is that when the CIA was busy inventing Mr. bin Laden and supporting the rebels in Afghanistan, they were laundering money through BCCI. The Iran-Contra scandal went through BCCI. There's an awful lot of very dirty linen in that bank.

Now, those records still exist someplace, somewhere, somebody can get a hold of the money trail through BCCI.

HARRIS: And as it turned out, that bank did not collapse -- it didn't get shut down because of any anti-terrorism activity. It just got shut down because it collapsed actually. But there are other banks out there. As a matter of fact, I read a report this morning about a bank in Sudan that Osama bin Laden is said to have started with some $50 million.

How do you actually find a bank that's been started by dirty money in a case like that?

ROBINSON: Well, you -- unfortunately you find it too late. It's the old story of closing the stable door after the horse has bolted.

But in the case of that bank in the Sudan, it's really interesting, because until 1997, they had very serious, very heavyweight connections with Western banks. Now, the Western banks have records of all of the transfers that they put -- that that bank put through the West. I mean, they have got the records of those correspondent actions. That must be looked at very, very closely. I suspect it will show a great deal. It will point fingers to various people and to various organizations, both in the West and in that part of the world.

HARRIS: Yes, you would think that the United States would be one place where you could not find a single voice that would defend a banking institution like that.

However, you heard in that report, Senator Phil Gramm from Texas here finding a way to say that that still should not be done.

So if you can find some support for actually not cracking down totally on banks like that in the U.S., how do you create that sort of unanimous, I guess, sentiment that it should be cracked down globally?

ROBINSON: Well, I'll tell you: Phil Gramm, I find his actions totally disgraceful and good riddance to him. He's leaving the Senate. Maybe now that the Republicans, and George Bush in particular who wants some of these laws passed, will get them passed, because we need them. We've got to be able fight terrorism by following the money.

What do you do globally? Well, unfortunately, you have an atrocity like the World Trade Center and the Pentagon bombings, and you get even Switzerland saying we are so outraged that we'll open up our books without anybody asking, and we'll look for it. How long that lasts is another matter, but at least for the time being, a lot of people who would not cooperate are cooperating.

HARRIS: Right. Let me ask you this question, and this maybe a pretty impossible one to ask you. But how much money would it actually take to set up an effective enough task force to actually find all of the money out there that's dirty?

ROBINSON: It would -- listen, it only takes $1,000 to set up a bank. It's going to take considerably more to set up the task force to dismantle those banks. Unfortunately, you need an awful lot of cooperation from parts of the world where, A, they are not willing to cooperate, and, B, even here in Western Europe where the laws don't necessarily permit cooperation. It's going to take a NATO kind of operation to go after the money.

Hopefully, some of the countries will follow, but the problem with money laundering is, it's like when you put your finger in the balloon, you don't actually take any air out of the balloon, you just displace it. And with money laundering when you stop it in one place, it moves to another.

HARRIS: Yes, and I hate to ask this question, because it may sound like it's a grim, maybe grimly flip question. But do you think it would take another tragedy, like the one we saw, to actually generate, I guess, the incentive or the will to actually do something like that globally?

ROBINSON: One seriously hopes not. One hopes that this has been enough. I mean, one of the things that people are now talking about, because of the World Trade Center and the Pentagon atrocities, is going after the offshore world. Now, that may not -- I mean, the Caribbean, which is an absolute sink of money laundering. That may not have been part of Mr. bin Laden's plan, but there is so much money sitting in the Caribbean.

In the Caiman Islands, there was one bank for every 49 people. The average size of the account is $20 million. Whose money is that? It's time to find out. It's time to put a stop to a lot of the shenanigans, through which people are earning money. And therein lies the problem.


ROBINSON: The people who could stop it are earning too much money doing it.

HARRIS: Boy, what a tangled web, and unfortunately, it's time for us to go. Jeffrey Robinson, thank you very much -- appreciate your...


HARRIS: ... coming back and sharing with us again -- hope to talk with you down the road.

ROBINSON: Any time.



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