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AMERICAN MORNING

Terrorist Counterfeit Connection

Aired December 1, 2003 - 08:18   ET

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

ANDERSON COOPER, CNN CORRESPONDENT: Well, the price may be right for that fake Gucci bag or imitation Rolex watch being sold on the street, but buyer beware. Your cash could actually be supporting terrorists.
Rachel Erhenfeld is the author of "Funding Evil: How Terrorism is Financed and How To Stop It."

She joins us now to talk more about the terrorist counterfeit connection.

Good morning.

Thanks for being with us.

RACHEL EHRENFELD, AUTHOR, "FUNDING EVIL": Good morning.

COOPER: How is that possible, that buying a Gucci bag on the street could actually fund a terror network?

EHRENFELD: It's like buying drugs. You buy drugs and the money ends up in the pockets of a terrorist organization. If you buy counterfeit products and the money ends up also, much of it, in terrorists' hands.

COOPER: Let's talk about the connection. Who are the groups selling these bags and how are they have connections to terror groups?

EHRENFELD: It's, here in the United States it's mainly, but not only, western African groups that are being directed and led by Nigerian. The Nigerian organized crime...

COOPER: By Nigerian organized crime groups?

EHRENFELD: Nigerian organized crime. They...

COOPER: So they, and they smuggle West Africans into the United States to sell these items?

EHRENFELD: Yes. Yes, they do, and many other people, as well, not only Nigerians, but mainly West Africans, to sell. You see them all over the streets of New York and elsewhere, in every big city. You see them also in stores, because counterfeit products are being sold. DVDs and CDs are being sold also in stores. And these people are being brought here in order to sell it, in order to undermine our economy. It costs the U.S. economy about $200 billion only from counterfeit bags and clothing. The CDs and DVDs are not even counted in this.

COOPER: But now where is the connection from Nigerian organized crime groups to international terror networks?

EHRENFELD: The, 50 percent of the Nigerian population is Muslim. The Sharia law is really what is running many of the countries, many of the states in Nigeria.

COOPER: Right.

EHRENFELD: And so they have an ideological affiliation, if you want. But this is really business. It's an international business and many terrorist organizations, the Hezbollah in South America in tri-region border -- in the tri-border regions in the Middle East, even the Palestinians are counterfeiting a lot of, lot of products and much of it is being sold in the United States, but also in Europe. This is how they are generating a lot of money.

COOPER: So you're saying that the connections between Nigerian organized crime and Hezbollah in South America or even, I guess, al Qaeda, in some cases, or even the IRA, I think you've mentioned in the past...

EHRENFELD: Yes.

COOPER: It's not just a political affiliation at times, say, with al Qaeda or the like, it's also just a business distribution method.

EHRENFELD: It's a huge, it's a huge underground business. It is huge -- it is a huge illegal economy that is worth billions of dollars.

COOPER: Do you feel law enforcement in the U.S. is paying enough attention to this?

EHRENFELD: No, I don't think so. I know that the Secret Service is paying a little bit of attention. I know that the British, the Scotland Yard, is having special task forces. Actually, they have a big meeting today, as we speak, with other Europeans about this issue. Even the U.N. has been considering something about this, but back in 1996. And there were some hearings in the Senate in 1999.

But this is really not on the radar of anybody and it should be, because it's huge.

COOPER: It's a fascinating topic.

Rachel Ehrenfeld, appreciate it.

The book is "Funding Evil: How Terrorism Is Financed and How To Stop It."

Thanks for being with us.

EHRENFELD: Thanks for having me. COOPER: All right.

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