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Funding terror, one small sum at a time
A view of a street money-change and transfer office in Milan, Tuesday, Sept.4, 2007. According to Italian officials explaining a recent anti-terrorism operation, every few weeks, one of a group of Tunisians would stop at an international money transfer office or local bank in the Milan area and wire funds to a city in Europe or the Middle East. The flow of small sums, according to investigators who recently broke up the Tunisian ring with the arrest of four people, showed they were involved in a steady transfer of funds allegedly used to recruit Islamic extremists and send them to terrorist training camps in Afghanistan. Investigators tracked some 40 money transfers by the Tunisian group between 1999 and 2001 to a wide range of countries in Europe and the Middle East, including Tunisia, Pakistan, Yemen, Algeria, Turkey and the United Arab Emirates. Some were just a few hundred euros (dollars). - photo by Associated Press
    MILAN, Italy — Prosecutors call it terrorism on the cheap.
    Every few weeks, the Tunisians would stop at a bank or Western Union office and wire funds to a city in Europe or the Middle East. No one took much notice. The sums were small — sometimes only a few hundred dollars — and thousands of other people were doing the same thing across Italy, many of them immigrant workers sending money home.
    This group, however, allegedly had dark motives.
    In June, Italian officials broke up the ring with the arrest of four people, three in Milan and one in London, after examining financial records showing a steady transfer of funds allegedly used to recruit Islamic extremists and send them to terrorist training camps in Afghanistan.
    ‘‘They were small amounts, below the limits that require reporting,’’ said an assessment by Italian financial police.
    The Associated Press interviewed key officials and uncovered previously undisclosed details about how terrorist cells move money — often by transferring sums so small they elude programs that track terrorist financing. It’s a loophole that raises questions about the effectiveness of the vast post-9/11 effort governments have made to choke off funding.
    ‘‘How much do you think it takes to carry out a terrorist attack?’’ Milan prosecutor Elio Ramondini asked during an interview in his office in Milan’s Palace of Justice. ‘‘Not very much,’’ he said.
    The operation that blew up three London subways and a bus in July 2005, killing 52 commuters, used readily available materials and cost just $15,000, the British government says.
    For the March 2004 bombings on four Madrid trains that killed 191 commuters, some analysts say the perpetrators spent less than $1,360. Others say the total was closer to $136,000, including explosives, a rental house, cell phones and other items. Police say most of the money came from low-level drug deals.
    In its recruiting activities, the cell uncovered by Italian authorities provided false documents, as well as apartments, cars and communication devices registered under false names. Ramondini said it is suspected of providing logistical and financial support to an al-Qaida affiliate linked to April bombings in Algiers that killed 30 people.
    Italian law only requires transfers above $14,400 to be reported to Italy’s Foreign Exchange Office. Senders of smaller sums must show IDs, which officials acknowledge can be forged.
    Despite the tightening of other laws since the Sept. 11, 2001, attacks in the United States, the limit for automatic reporting has remained much the same in Europe.
    As shown by the arrests of militants in Germany and Denmark for allegedly planning bomb attacks, one thing is clear: Europe with its growing immigrant populations and open borders has become a major target for Islamic radicals.
    While authorities have given few details, the reports of the lifestyles of the suspects — the Germans were unemployed and living on welfare — and the kind of chemicals they were allegedly using was an indication that great expense was not involved.
    Many of the recent plots in Britain, and the alleged plot in Germany, featured hydrogen peroxide, which is very cheap, as the principal bomb-making ingredient. At a recent police briefing, London’s chief counterterrorism officer said a failed plot to attack the city’s transport network— two weeks after the July 7, 2005, attacks — cost just $1,000.
    The German plan ‘‘is part of the tendency to carry out attacks with the most simple means,’’ said Germano Dottori, an analyst at Rome’s Center for Strategic Studies. ‘‘The danger of catastrophic attacks has diminished, but there is now a widespread threat of smaller attacks.’’
    Western Union, which according to Ramondini was used by the Tunisians in Italy, said it cooperates fully in fighting terrorism. It invested more than $30 million in its worldwide compliance efforts in 2006 and planned to invest more than $35 million in 2007, Sherry Johnson, the company’s director of media relations, said in an e-mail.
    She declined to comment on the arrests in Italy, saying Western Union doesn’t comment on active legal investigations.
    In Italy, ‘‘Western Union agents are required to report all suspicious transactions, regardless of dollar amount,’’ she said. But they rely on information provided by governments and are entirely dependent on its reliability, Johnson said.
    Loretta Napoleoni, a London-based expert on terrorism financing, acknowledges that governments are in a bind: Their filters are weakened by their inability to catch small amounts, but if Western Union and others had to report every transaction of a few hundred dollars, ‘‘there would be a revolution.’’
    Ramondini, the prosecutor, emphasized that the money transfer agencies did no wrong and that it would be unreasonable to demand more of them.
    ‘‘You would bring the economy to a halt,’’ he said.
    Col. Antonio Grimaldi of the Guardia di Finanza, who led the Milan investigation, said Islamic extremists are increasingly resorting to small transfers to evade detection.
    ‘‘In this and other investigations we have come across this ’tactical’ kind of financing that keeps the cell alive and still allows it to organize attacks,’’ he said.
    Officials said the key to cracking the Milan cell was an informer who enabled investigators to work backward and trace the paper trail.
    Ramondini said investigators tracked some 40 money transfers by the group between 1999 and 2001, totaling about $68,000, to a wide range of countries in Europe and the Middle East, including Tunisia, Pakistan, Yemen, Algeria, Turkey and the United Arab Emirates.
    The cell was allegedly part of the Salafist Group for Call — or GSPC. The group changed its name to ‘‘al-Qaida in Islamic North Africa’’ when it announced its alliance with al-Qaida in January and is on the U.S. list of terrorist organizations.
    AP reporter Ariel David in Rome contributed to this report.

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