Executive Intelligence Review
This article appears in the September 27, 2013 issue of Executive Intelligence Review.

Saudi Bankrolling of al-Qaeda
Well Known to U.S. Government

by Jeffrey Steinberg and Edward Spannaus

[PDF version of this article]

"If I could somehow snap my fingers and cut off the funding from one country, it would be Saudi Arabia."

                    —Stuart Levey,
                        Treasury Under Secretary,
                        in charge of tracking terror financing,
                        to ABC News, Sept. 11, 2007.

Sept. 23—The U.S. government has known for years that the Kingdom of Saudi Arabia is the largest source of funds for global jihadist terrorism, including funding of the 9/11 attacks against the U.S., but has, to date, refused to take any effective action against it. Behind the Saudis, of course, are the British, a relationship that is exemplified by the British-Saudi Al-Yamamah slush fund, used by Prince Bandar and others as a major source of terror funding.

This coverup goes far beyond the suppression of the crucial 28-page chapter from the Joint Congressional Inquiry into 9/11, concerning Saudi support for the 9/11 hijackers, the concealment of which has continued under the Obama Administration.

Something which has received far too little attention, is the 335-page report issued in July 2012 by the Senate Permanent Subcommittee on Investigations, exposing the role of HSBC (formerly, the Hong Kong and Shanghai Banking Corporation) in money-laundering and global narcotics and terrorism financing. This included a 50-page chapter on HSBC's sordid ties to Al-Rajhi Bank, the largest private bank in Saudi Arabia, with $59 billion in assets, and over 500 branches. The bank was founded by the Al-Rajhi brothers, led by Sulaiman Abdul Aziz Al-Rajhi, chairman of the board of the bank, and a pivotal al-Qaeda financier, according to a number of CIA and Treasury reports.

As is recounted in the Senate report, the 9/11 Commission Report and numerous other official government documents show that in March 2002, the FBI and Bosnian authorities raided the Bosnian offices of the Benevolence International Foundation, a Saudi charity known to conduit money to al-Qaeda. Investigators found a computer hard drive documenting al-Qaeda's funding apparatus, which was dubbed the "Golden Chain." Among the top 20 funders of al-Qaeda identified in one document on the hard drive, was Sulaiman Al-Rajhi.

The Senate report also noted that at the same time that the Bosnia raid occurred, in March 2002, the FBI was also raiding the Northern Virginia offices of the SAAR Foundation, a front for the Al-Rajhi group, linked both to the Muslim Brotherhood and other hard-core terrorist cells around the globe. "Operation Green Quest" targeted SAAR and the affiliated Safa Group of charitable and business fronts, all tied to the Saudi regime.

Additionally, in 2003, as cited in the Senate report, the CIA produced a classified report that was later leaked to the Wall Street Journal, titled "Al-Rajhi Bank: Conduit for Extreme Finance." According to the Lloyds lawsuit (see below), the CIA report stated:

"Islamic extremists have used Al-Rajhi Banking & Investment Corporation (ARABIC) since at least the mid-1990s as a conduit for terrorist transactions, probably because they find the bank's vast network and adherence to Islamic principles both convenient and ideologically sound. Senior al-Rajhi family members have long supported Islamic extremists and probably know that terrorists use their bank. Reporting indicates that senior al-Rajhi family members control the bank's most important decisions and that ARABIC's principal managers answer directly to Suleiman. The al-Rajhis know they are under scrutiny and have moved to conceal their activities from financial regulatory authorities."

Saudi Role Officially Recognized

Other evidence of official U.S. knowledge of Saudi terrorism financing, cited in the Senate report, includes:

  • The 9/11 Commission found that the Al-Rajhi Bank was directly implicated in conduiting funds to the hijackers through the International Islamic Relief Organization, which maintained accounts at Al-Rajhi. It was through those accounts that funds were wired to Abdulaziz Al-Omari, one of the 9/11 hijackers, just four days before the attacks.

  • The U.S. State Department and the Congressional Research Service reported in 2007 that Saudi Arabia continued to be a source of financing for al-Qaeda and other terrorist organization, including the statement by Stuart Levey quoted above.

  • In April 2008, Levey testified that, although Saudi Arabia was taking strong action against terrorists inside its borders, it was not working as hard to prevent money from flowing to terrorists outside its borders. "Saudi Arabia today remains the location from which more money is going to terror groups and the Taliban—Sunni terror groups and the Taliban—than from any other place in the world."

  • A 2009 GAO report prepared for Congress stated: "U.S. officials remain concerned about the ability of Saudi individuals and multilateral charitable organizations, as well as other individual visiting Saudi Arabia, to support terrorism and violent extremism outside of Saudi Arabia."

Not mentioned in the Senate report, because it only came to light later, through Wikileaks, was a Dec. 30, 2009 State Department cable which stated that "donors in Saudi Arabia constitute the most significant source of funding to Sunni terrorist groups worldwide." The cable also said that, despite some cooperation from the Saudi government, "more needs to be done since Saudi Arabia remains a criticial financial support base for al-Qa'ida, the Taliban, LeT [Lashkar e-Tayyiba], and other terrorist groups, including Hamas, which probably raise millions of dollars annually from Saudi sources, often during Hajj and Ramadan."

Other Links

Other Saudi banks and financial groups have been linked to the same tightly knit apparatus, all operating under the protection of the Saudi Ministry of Religious Affairs. The other banks included Bank of Taqwa, which was identified by the U.S. Treasury Department as a Specially Designated Terrorist Entity. Treasury stated, in November 2001: "Al-Taqwa group has long acted as a financial advisor to al-Qaeda, with offices in Switzerland, Lichtenstein, Italy and the Caribbean." Akida Bank Private LTD, another Saudi bank tied to al-Qaeda money laundering, listed Sulaiman Al-Rajhi on its board of directors. The bank was run by Youssef Nada, a known financier of Saudi-backed terrorist cells.

The HSBC links to Al-Rajhi Bank dated back, according to the Senate report, to HSBC's takeover of Republic National Bank of New York, which was sold to HongShang by Edmond Safra. Under Safra, Republic National Bank was exposed for laundering the profits of a top Turkish heroin-smuggling ring operating out of the Shakarchi Trading Company in Switzerland. When HSBC took over Republic National Bank, the existing Al-Rajhi accounts were taken over by HSBC New York.

'All the keys are here...'

In testimony before the U.S. Senate on Oct. 22, 2003, Jean-Charles Brisard, a French terrorism expert who was the lead investigator for a civil lawsuit filed by the 9/11 families, summed up the track record of the Saudis this way:

"In June 2001, the late FBI Chief of Anti-Terrorism, John O'Neill, told me that 'All the answers, all the keys enabling us to dismantle Bin Laden's network are in Saudi Arabia.' Today, all of our leads and much of the evidence collected by the 9/11 families put Saudi Arabia on the central axis of terror and shows that this [Saudi] government was aware of the situation, was able to change the path of its organizations, whether banks, businesses or charities, but voluntarily failed to do so. Rather, the Saudi government repeatedly claimed since at least 1993 that the situation was under control, while facilitating the reach and involvement of the charities and the financial institutions of the kingdom, or inciting its citizens to support the terror fronts, when the highest ranking members of the royal family are pouring tens of millions of dollars each year to Islamic charities known for diverting money to Al-Qaida."

Obama Protects the Saudis

Both the Bush and Obama administrations have gone to extraordinary lengths to block the 9/11 families from holding the Saudi government and its royal family accountable for their role in the 9/11 attacks.

In 2005, the families' lawsuit against the Kingdom of Saudi Arabia, several Saudi princes, and various Saudi-controlled charities, was dismissed by a Federal judge in New York City, at the request of the Bush Administrtion, on the grounds that the Kingdom was immune from such claims under the Foreign Sovereign Immunities Act. The dismissal was upheld in 2008 by the U.S. Court of Appeals for the 2nd Circuit.

When the families appealed to the U.S. Supreme Court in 2009, the Obama Administration rushed to the Kingdom's defense, repeating the Bush Administration's claim that the Saudi government and members of the royal family were immune from lawsuits. The Obama Justice Department argued that, since the Kingdom of Saudi Arabia had never been designated as a state sponsor of terrorism (who could be more deserving of this label than the Saudis?), it therefore possessed sovereign immunity.

"I find this reprehensible," Kristen Breitweiser, a leader of the 9/11 families, told the May 30, 2009 New York Times. "One would have hoped that the Obama Administration would have taken a different stance than the Bush Administration, and you wonder what message this sends to the victims of terrorism around the world."

(That was just a foretaste of things to come. Since then, Obama has openly allied his Administration with Saudi-backed al-Qaeda terrorists in Libya, and now in Syria.)

The Supreme Court refused to review the dismissal of the suit. However, in 2011, the 2nd Circuit Court of Appeals reversed itself and allowed the families' suit to proceed under a different legal theory, and in April of this year, it reinstated much of their lawsuit.

The Lloyds Suit

Meanwhile, shortly before the 10th anniversary of the 9/11 attacks, another suit was filed which contained an extraordinary compilation of evidence, heavily drawn from government sources, of the direct Saudi responsibility for the 9/11 attacks and for the financing of Osama bin Laden and al-Qaeda.

Lloyds Syndicate 3500, a Lloyds of London insurance portfolio, filed its suit in the U.S. District Court for Western Pennsylvania in Johnstown, Pa., near the site where one of the four 9/11 hijacked commercial airliners crashed. Named as defendants were the Kingdom of Saudi Arabia, a number of Saudi government-run charities, and two Saudi banks; the suit demanded at least $215 million in compensation for insurance payments the syndicate had made to victims of the Sept. 11, 2001 attacks.

The suit was premised on the argument that, while the costs of the 9/11 attack per se were limited, al-Qaeda had a $35-million-a-year budget that was largely covered by payments from the Saudi royal family and allied circles. The complaint provides extremely detailed allegations about the role of the Saudi regime in sponsoring, financing, and supporting al-Qaeda over the 13-year period from 1988 through the Sept. 11, 2001 attacks. The evidence compiled for the lawsuit was based almost exclusively on U.S. and Saudi government documents, including publicly available evidence provided by scores of Guantanamo Bay detainees, who were picked up as "enemy combatants," and who were affiliated with either al-Qaeda or the Saudi charities named in the suit.

"The success of al Qaeda's agenda, including the September 11th attacks themselves, has been made possible by the lavish sponsorship al Qaeda has received from its material sponsors and supporters over more than a decade leading up to September 11, 2001,"

the complaint stated, continuing:

"Although al Qaeda has in limited instances established its own charities to serve as channels of support for particular initiatives, al Qaeda's development into a sophisticated global terrorist network was fueled primarily by the massive support it received from purported charities acting as agents and alter-egos of the government of the Kingdom of Saudi Arabia, many of which worked with the al Qaeda leadership during the Afghan jihad. These governmental agents have served as the primary conduits for channeling financial, logistical, operational, and ideological support for al Qaeda's global jihad for more than twenty years. To this day, many of these arms of the Saudi government remain dedicated to promoting al Qaeda's goals and operational objectives."

Among the nominally private da'awas (charities) named in the suit were: the World Muslim League, the Saudi Red Crescent, and a variety of Saudi charities that funded the wars in Afghanistan, Bosnia, Kosovo, and Chechnya. All of these organizations were controlled by the Saudi Ministry of Religious Affairs, and by Saudi Arabia's Interior Minister, Prince Nayef, who is now second in line to the throne, and who chaired the government committee overseeing all of the named charities. As the Lloyds complaint put it, these organizations were "created by the government of the Kingdom to propagate a radical strain of Islam throughout the World, commonly referred to as Wahhabism."

For reasons which were never stated, the lawsuit was withdrawn shortly after filing, although the complaint is still publicly available. However, the same law firm which filed the Pennsylvania suit, Cozen O'Connor of Philadelphia, is also representing the plaintiffs in the reinstated New York case, which includes insurance companies, so it is probable that the evidence cited in the Pennsylvania case will be included in the pending New York case.

Treachery

What all of this demonstrates, is that the U.S. government is fully cognizant of the Saudi responsibility for both 9/11, and for ongoing terrorist attacks. Yet, had the same degree of effort from the U.S. government, including Congress, been directed against Saudi Arabia, as has been aimed at Iran with far less evidence, the world would be free of major terrorist attacks today.

The level of treachery involved in the U.S.-Saudi relationship—particularly following the 9/11 attacks—is beyond belief. It is long overdue for those ties to be severed, and for the full criminal apparatus behind 9/11—the Saudis and their British backers—to be prosecuted, with no holds barred.

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