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Senin, 11 Juni 2012

Why the Iran Sanctions Matter

It's easy to criticize the U.N. Security Council's new resolution targeting Iran. But it might prove a surprisingly effective tool in tightening the noose on the regime in Tehran.

Wednesday's U.N. Security Council resolution sanctioning Iran marks a critical turning point in the U.S.-led efforts to target Iran's illicit activities. The resolution focuses on Iran's nuclear-weapons and ballistic-missile programs; the Islamic Revolutionary Guard Corps (IRGC), which is responsible for these programs as well as the regime's support for terrorism; and the Islamic Republic of Iran Shipping Lines (IRISL), which has been directly involved in proliferation shipments. The sanctions included in this resolution are, as U.S. Ambassador to the U.N. Susan Rice put it, "as tough as they are smart and precise." If anything, this new resolution is both too precise and purposefully vague. And therein lies its strength.

The list of 40 entities and one individual listed in the resolution's three annexes is extremely targeted. Employing such "smart sanctions" -- pinpointing the specific entities and persons involved in Iran's illicit conduct and holding them accountable while shielding the general Iranian public from old-fashioned, shotgun, regime-wide sanctions -- has been very effective. This tactic denies Iran's revolutionary regime the chance to deflect blame for the country's economic woes, while disrupting its ability to finance and transport material necessary for its nuclear-weapons and ballistic-missile programs. But the number of entities excluded from the resolution is even more telling than the list of those that made the final cut. Most entities designated this week, for example, had already been designated by the U.S. Treasury Department and/or the European Union. They have therefore already been subject to most of the impacts a U.N. resolution would hope to achieve, such as economic isolation by major financial institutions.

Consider Iran's shipping line, IRISL. The U.S. government first designated IRISL in September 2008 for facilitating the transport of cargo for U.N.-designated proliferators and falsifying documents and using deceptive schemes to shroud its involvement in illicit commerce. And, as the State Department noted at the time of the designation, IRISL had already been "called out by the U.N. Security Council as a company that has engaged in proliferation shipments."

But following up on U.S. and EU designations of entities like IRISL or the IRGC-controlled Khatam al-Anbiya construction company (also called Ghorb) by designating them at the United Nations as well is vitally important to the global sanctions regime. With critical countries such as China, Malaysia, Singapore, and others willing to do only the minimum to comply with Security Council resolutions, getting critical entities like IRISL and IRGC companies designated at the U.N. means wider implementation of sanctions.

Unfortunately, multilateral action is not only difficult to achieve, but can often lead to lowest-common-denominator decision-making. So while international consensus was being built for robust action at the U.N., Britain, the European Union, the United States, and others wisely pursued both unilateral and bilateral financial measures focused on IRISL, IRGC-affiliated entities, and other individuals and institutions facilitating Iran's illicit conduct. With the increased militarization of the Iranian regime and the blatant abuses of the IRGC-affiliated Basij militia, targeting entities affiliated with the Revolutionary Guard unilaterally while international consensus was being built to do so at the U.N. level was an effective strategy. That does mean, however, that this week's list of sanctioned entities is more of a reinforcement of prior actions than completely new ones.

And that's OK. Because though the lists of sanctioned entities are very precise, U.S. and other negotiators made sure that general "hooks" upon which additional actions could be "hung" were peppered throughout the body of the resolution. These will provide the United States and other states and multilateral bodies with the international imprimatur for further action. Put another way, the new resolution is most important not for the specific entities listed in its annexes, but for providing a foundation upon which further efforts to disrupt Iran's illicit activities can be built.

Note, for example, the multiple times the resolution "calls upon all States" to do things above and beyond checking the list of specifically sanctioned entities and persons, such as the call to "exercise vigilance" over transactions involving the IRGC that could contribute to "proliferation-sensitive nuclear activities or the development of nuclear weapon delivery systems." In plain English, this language effectively empowers states and other international bodies to take still more stringent action against the IRGC.

Broadening its sanctions against Iran's shipping company, the resolution "calls upon all States" to inspect "all cargo to and from Iran, in their territory, including seaports and airports, if the State concerned has information that provides reasonable grounds to believe the cargo contains items the supply, sale, transfer, or export of which is prohibited" by this or prior Security Council resolutions. The contrast between the specificity of the list of sanctioned entities and the fairly low standard of "reasonable grounds to believe" is a telling example of purposeful vagueness that could prove powerful in the hands of states inclined to get tough on Tehran.

Similarly, the resolution "requests" that all member states report to the U.N. "any information available" on "transfers or activity by Iran Air's cargo division or vessels owned or operated by [IRISL] to other companies" that might be related to sanctions evasion. The resolution "calls upon" states to "take appropriate measures" -- which, again, by virtue of being appropriately vague is appropriately empowering -- both to prohibit Iranian banks from opening branches, subsidiaries, representative offices, joint ventures, or correspondent relationships with banks in their jurisdiction and to prohibit financial institutions in their territories or under their jurisdiction from opening offices or accounts in Iran.

Indeed, the resolution specifically "welcom[es]" the guidance issued by the Financial Action Task Force (FATF) -- the multilateral technocratic body that sets international standards to combat money laundering and terrorism finance -- to assist states in implementing their financial obligations under two previous resolutions, 1737 (2006) and 1803 (2008). In particular, it highlights the FATF's warning to "exercise vigilance over transactions involving Iranian banks, including the Central Bank of Iran, so as to prevent such transactions contributing to proliferation-sensitive nuclear activities, or to the development of nuclear weapon delivery systems." So though the Central Bank of Iran is not specifically sanctioned, it is, broadly speaking, open game.

In February, the FATF named Iran to its new blacklist, recognizing that in support of its weapons programs, its crackdown on democracy, and its terrorist proxies, Tehran has continued to engage in deceptive financial conduct aimed at raising, moving, hiding, and accessing funds internationally. In line with the G-20's call to protect the international financial system from abuse, the blacklist identified countries with deficient "anti-money laundering and combating the financing of terrorism" (AML/CFT) measures. Iran received special designation on the blacklist; it was the only country whose illicit financial conduct merited a call for international countermeasures.

Contrary to conventional wisdom, Iran is highly sensitive to such actions. After one of the FATF's warnings, for example, Iran sent a delegation to lobby the agency despite not being a member. The FATF, however, dismissed Iran's claims that legislative changes had fixed its financial shortcomings, calling the new measures "skimpy" and noting their "big deficiencies." Indeed, the FATF blacklisted Iran even as it recognized the regime's "recent steps" to engage with the agency. The message seemed to be that the FATF would not mistake public engagement for substantive progress. Similarly, though Iran requested technical help from the U.N. Office on Drugs and Crime to set up a computer-based training center for its nascent financial intelligence unit, the FATF still highlighted the regime's "failure to meaningfully address the ongoing and substantial deficiencies" in its AML/CFT efforts.

The result is a sharp increase in the cost of doing business for the Iranian regime. European multinational companies are terminating business relationships with Iran, following the lead of major international banks in tightening the noose on Iran's financial system. Chinese and Malaysian companies may lap up available contracts, but many key technologies Iran needs for its oil and gas industries and for its nuclear and missile programs are only available in the West.

And now, for a change, existing sanctions might finally be seriously enforced. Just as important as the specific list of sanctioned entities and the broad invitations to take further action against Iran is the resolution's creation of a monitoring committee, including a panel of experts, to better enforce existing sanctions. Indeed, expert panels proved effective in strengthening sanctions on Sudan and Ethiopia. The "naming and shaming" power of the panel's findings could further influence firms and individuals considering whether to run the risk of doing business with Iran. Furthermore, an expert panel could also help the Sanctions Committee and U.N. member states by recommending ways to make the sanctions more effective. Such a monitoring committee would be particularly effective if it included among its experts individuals knowledgeable about export control and dual-use goods.

But implementation and follow-up is everything in the sanctions business. For the new resolution to make a difference, three things must happen.

First, states like Britain and the United States, regional bodies like the EU, and multilateral bodies like the FATF and G-20 must all act on the resolution's various "calls" to expand the resolution beyond the list of specifically sanctioned entities.

Secondly, the monitoring committee must demand substantive reports from member states upon which it can submit public reports with substantive recommendations for enhancing enforcement of existing sanctions.

Finally, unless the report finds that Iran has become fully compliant with its obligations, the Security Council must quickly follow up on the report with another round of sanctions. The resolution requests that the director general of the International Atomic Energy Agency submit a report to the Security Council within 90 days on whether Iran has established "full and sustained suspension" of its illicit nuclear activities. If the international community does not respond in a timely fashion, the entire premise of targeted and graduated sanctions -- the credibility of which are premised on consequences for ongoing illicit conduct -- will be irreparably damaged. One reason Iran has not been deterred by the sanctions put in place to date is that the deadlines of prior resolutions came and went with no timely follow-up. This delay undermined the whole sanctions enterprise, leaving Iran with the general sense it could survive sanctions, get by, and outlast the resolve of the international community. June 9's resolution offers an opportunity to reverse that trend and re-empower sanctions as an effective tool of foreign policy, one that doesn't require the use of force.

On their own, these sanctions will not solve the crisis over Iran's nuclear program. But wisely implemented and enforced, they could prove critical in preventing Iran from getting the bomb. And that's a very good thing.

Rabu, 06 Juni 2012

Indian Govt signs MoUs with three countries to fight terror financing

The MoUs will enable the country’s Financial Intelligence Unit to share information with foreign FIUs and to obtain information from them on money-laundering activities

The government has signed memoranda of understanding with Russia, Malaysia and Brazil this year for combating money laundering and terror financing.

Negotiations with more than 30 other countries is under process for enhancing international cooperation in fighting illegal routing of money for terror and Hawala like operations, a senior finance ministry official has said.

India has also signed MoUs in this regard with Mauritius and the Philippines in 2008.

The MoUs will enable the country’s Financial Intelligence Unit (FIU) — a government agency to investigate and disseminate information between financial and law enforcement agencies for identification of suspicious money laundering — to share information with foreign FIUs wherever considered necessary and reciprocally to obtain information from them on money-laundering activities, the official said.

The government, in the same context this year, received 69 requests of information from foreign financial intelligence units while it sent 17 such requests to other countries.

The Union government has also established Joint Working Groups (JWG) — comprising senior officials from enforcement agencies — with a number of countries like the US, Germany, the UK and Russia on various operational issues relating to terrorism and other crimes including money laundering and drug trafficking.

A joint meet was held with Russia this year, the finance ministry official added.

The FIU-IND in relation to foreign FIUs screens and processes requests from foreign FIUs, disseminates information to foreign FIUs, establishes and maintains relationship with foreign FIUs, and facilitates, administers and negotiates Memoranda of Understanding (MoUs) with foreign FIUs.

According to established government guidelines, the MoU envisages that the information or documents obtained from the respective authorities will not be disseminated to any third party, nor be used for administrative, prosecutorial or judicial purposes without prior consent of the disclosing Authority.

The information acquired will be treated as confidential and will be subject to official secrecy. The MoU also provides that authorities will jointly arrange, consistent with the legislation of their respective countries, for acceptable procedures of communication and will consult each other with the purpose of implementing the Memorandum, the guidelines state.

The guidelines further add that the authorities would not be under any obligation to give assistance if judicial proceedings have already been initiated concerning the same facts to which the request is related. Further, the MoU may be amended or revoked at any time.

Source: Live Mint

Selasa, 05 Juni 2012

Ghana fingered in Australia massive identity fraud

Ghana has been named as one of the countries whose citizens are stealing the identities of Australians.

News out in the Australian media say the theft which is in a large scale involves spies, drug dealers, illegal immigrants and people engaged in money laundering.

The report say passport details of five people emailed to a travel agent for travel for people from Ghana has been found.

One report by the Herald Sun citing documents from the country’s Department of Foreign Affairs and trade says the illegal practice of forging passports of living Australians is widespread.

According to the report, a fake or doctored Australian passport has been found, on average, once a week in the past three years.

Fake passports were detected at ports in countries including Britain, Dubai, Ghana, Thailand, Hong Kong, Indonesia, Malaysia, Egypt, Turkey, and Peru, the report indicated.

According to the report, some of the passports were in the hands of spies, smugglers and thieves.

Australian passports were used in 525 frauds in the last financial year, and many people were caught lying to get a passport, it said.

Source: Citifmonline

Rabu, 30 Mei 2012

Satyam Wins Pegasystems Partner Innovation Award for AML Solution

October 30, 2007: 12:33 PM EST

HYDERABAD, India, Oct. 30 /PRNewswire/ -- Satyam Computer Services Ltd. , a leading global consulting and IT services provider, announced today that it won the 2007 Pegasystems Partner Innovation Award in financial services. The announcement was made at PegaWORLD 2007, Pegasystems' annual conference, and one of the business process management (BPM) industry's flagship events.

Satyam won the esteemed award for its advanced Anti-Money Laundering (AML) solution, which enables financial institutions to intelligently track, manage and quickly resolve potentially fraudulent and criminal activity with greater speed and accuracy and to comply with stricter AML regulations. Satyam used Pegasystems' SmartBPM(R) Suite to create the new solution, which addresses a critical and underserved need in the market.

"Financial institutions now have an innovative way to fight fraud and financial crime, as well as stay in compliance with BSA/AML/KYCC statutes," said Anil Kumar, the Global Head of Satyam's Financial Services Business.

Integration among Satyam experts accelerated the solution's development and deployment.

"Satyam's business process management and banking experts leveraged Pegasystems' SmartBPM platform to rapidly deliver an advanced solution without additional and costly software development," said Joseph Lagioia, head of Satyam's Consulting and Enterprise Solutions Practice. "We are very proud and pleased to win this prestigious honor."

Satyam's AML solution optimizes a financial institution's existing transaction-monitoring systems-detecting suspicious activity such as the deposit of very large sums, multiple accounts for the same person, and suspicious names-while at the same time minimizing the number of false positives, which has been a nagging problem in the past. The solution also allows financial institutions to recognize suspicious transactions quickly, rather than waiting until the end of the day, which is the norm for institutions using case management systems.

"Satyam combines superior subject matter expertise in financial services with deep understanding of Pegasystems technology to deliver truly innovative business solutions in an accelerated fashion," said Douglas Kim, managing director of Global Alliances and Business Development for Pegasystems. "We're proud of our long-standing relationship with Satyam and are delighted to recognize them with this award."

About Satyam

Satyam , a leading global business and information technology services company, delivers consulting, systems integration, and outsourcing solutions to clients in 20 industries and 57 countries.

Satyam leverages deep industry and functional expertise, leading technology practices, and an advanced, global delivery model to help clients transform their highest-value business processes and improve their business performance. The company's 45,700* professionals excel in engineering and product development, supply chain management, client relationship management, business process quality, business intelligence, enterprise integration, and infrastructure management, among other key capabilities.

Satyam development and delivery centers in the US, Canada, Brazil, the UK, Hungary, Egypt, UAE, India, China, Malaysia, Singapore, and Australia serve 599* clients, 173 of which are Fortune Global 500 and Fortune US 500 corporations. For more information, see http://www.satyam.com.

*As of Sept. 30, 2007

Safe Harbor

This press release contains forward-looking statements within the meaning of section 27A of Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward- looking statements. Satyam undertakes no duty to update any forward-looking statements. For a discussion of the risks associated with our business, please see the discussions under the heading "Risk Factors" in our report on Form 6-K concerning the quarter ended June 30, 2006, furnished to the United States Securities Exchange Commission on July 28, 2006 and the other reports filed with the Securities Exchange Commission from time to time. These filings are available at http://www.sec.gov.

http://money.cnn.com/news/newsfeeds/articles/prnewswire/DCTU00430102007-1.htm

Selasa, 29 Mei 2012

MALAYSIA: Bank Negara: Insurers Must Implement Risk-based Capital Framework

KUALA LUMPUR, Oct 29 (Bernama) -- Insurance companies must implement the risk-based capital (RBC) framework by Jan 1, 2009, Bank Negara Malaysia's deputy governor Datuk Zamani Abdul Ghani said Monday.

He said the RBC framework, aiming to create a strong risk management culture, started its parallel run in 2007 with a two-year timeframe but insurers who are ready will be allowed by the central bank to implement it next year.

"The implementation of the RBC framework will give more flexibility if the (insurance) operator is good," he told reporters at the 23rd Pacific Insurance Conference here.

The new requirement is to facilitate more efficient capital structures and provide greater investment flexibility to insurers without compromising on prudential standards.

Under the risk-based regulatory regime, responsibility for the implementation of risk management, market conduct governance and assessment of risks and management of the financial conditions of an insurer, will increasingly rest with its board of directors and senior management.

Earlier in his speech at the conference, Zamani said the insurance industry, including the takaful sector, recorded a combined premium growth of nearly 10 percent for both life and general segments to reach RM13 billion in the first half of this year.

He said the assets of life and general insurance funds registered a double-digit growth of 14 percent to RM116 billion as at end June this year, up from 11 percent in the same period last year.

"This growth momentum is expected to continue in 2008 in line with the sustained growth of the Malaysian economy," he added.

On the takaful industry, Zamani said the market penetration level remained low, with less than five percent in many Muslim countries and 6.8 percent in Malaysia, thus providing significant market potential that remained untapped.

He said strong and qualified foreign takaful companies, especially those with strong credentials, were invited to make Malaysia as their centre for retakaful activities.

On anti-money laundering and counter financing of terrorism (AML/CFT) activities, Zamani said Malaysia was ranked among the top 10 countries in terms of AML/CFT compliance in the recent Mutual Evaluation Report 2007 assessment excercise.

The AML/CFT compliance standards are set by the Financial Action Task Force on Money Laundering help to deter the Asia Pacific region from being targeted as a regional centre for money laundering and terrorism financing, he said.

http://www.bernama.com.my/bernama/v3/news_business.php?id=292857

Selasa, 22 Mei 2012

Malaysia: Suspended division head acquitted of money-laundering charge

Suspended Kubang Kerian Umno division head Mohd Fauzi Ismail shed tears of joy Tuesday after the Sessions Court here set him free, without his defence being called, of two counts of money laundering amounting to RM138,210.

Mohd Fauzi who was suspended for the last two years pending the court decision was carried by his supporters after Judge Che Mohamad Zulkifly Jusoh announced his decision before a packed courtroom.

Mohd Fauzi was charged under the Anti Money-Laundering Act 2001 where he could be fined up to RM5mil or go to jail for five years, or both.

He was alleged to have received the sum for the purpose of money laundering from proceeds earned through illegal activities.

He was charged with receiving the sum from associates, Mohamed Syahbuddin Hashim at Sultan Mohamed IV Stadium here on Jan 5, 2005 and Wan Ibrahim Wan Setapa at the division’s office four days later.

Che Mohamad Zulkifly said the prosecution led by the Anti-Corruption Agency (ACA) failed to prove “prima facie” in the case while there were serious contradictions detected in the testimonies of witnessess.

Che Mohamad Zulkifly also ruled that there were doubts whether the money given to the defendant was derived from illegal activities.

http://thestar.com.my/news/story.asp?file=/2008/1/22/nation/20080122154416&sec=nation

Senin, 21 Mei 2012

Philippines extends freeze order on suspected terrorist's assets

The Court of Appeals on Tuesday granted the government's petition to extend for another four months the freeze order on several bank accounts of suspected terrorist Hilarion del Rosario Santos, alias Ahmed Santos - the alleged founder of the terror group Rajah Solaiman Movement (RSG).

In a five-page resolution penned by Associate Justice Teresita Dy-Liacco Flores, the CA’s Special Second Division granted the ex-parte petition filed by the Anti-Money Laundering Council to extend the freeze order against certain properties and assets in the name of Santos or his aliases, Hilarion delos Santos Jr, Hilarion del Rosario Santos III and Ricardo Ayeras.

The original freeze order issued by the CA expired last September 26, prompting the Office of the Solicitor General, representing the AMLC, to ask for an extension and for the junking of respondent’s motion to lift the freeze order.

With the CA’s ruling, the freeze order on Santos’ assets was extended until January 25, 2009.

The appellate court agreed with the argument of the OSG that the freeze order does not prevent respondent from using or earning a living from said properties, and that its purpose was merely to prevent the disposition of the subject property pending the completion of the AMLC’s investigation for possible filing of a civil forfeiture case against respondents.

“What the freeze order seeks to prevent is only the disposal or alienation of said properties during the effectivity of the said order. The Court notes that aside from Santos’ bare assertions that he is not engaged in any unlawful activity, he has not attached any proof of his innocence," the CA ruled.

The Court said that the AMLC presented prima facie evidence of his illegal activities that led to the issuance of warrants of arrest against him for rebellion and 21 counts of kidnapping and serious illegal detention with ransom, which the CA noted was needed by the group to fund its terrorist activities.

Santos converted to Islam while working in Riyadh, Saudi Arabia in 1991 and where he received bomb-making training. He was captured by military officials in October 2005 for involvement in organizing and planning bomb attacks in predominantly Christian cities in the country and was subsequently convicted of rebellion.

He was arrested with his wife Fatima and five other people while they were sleeping in a hideout in southern Zamboanga city.

The RSM, which he founded, is believed to have forged an alliance with the Abu Sayaff and the regional militant group Jemaah Islamiyah, both of which are linked to the al-Qaeda.

The military has been linking Santos, his brother Dawud and their group to the Valentine’s Day bombing in 2005 that killed eight people and injured a hundred others and to the bombing of a passenger ferry off Bataan last year that claimed over a hundred lives.

Also, the group has been linked to the alleged plot to blow up the US embassy in Manila, the kidnapping of 21 foreigners in Sipadan, Malaysia and the foiled Lenten holiday bombing in Malate in 2006.

During his arrest, Santos was said to have been getting foreign funding through his bank account.

His group also reportedly established a training camp in his family's property in Pangasinan, where an Al Qaeda suicide cell allegedly trained before the 9/11 attacks.

Santos’ capture prompted the US government to pay P26 million reward to two tipsters who provided information for his arrest, as he was also tagged for alleged involvement in the September 11, 2005 bombing of the World Trade Center in New York and related attacks.

In its ruling, the CA likewise ordered that the Register of Deeds of Pangasinan and Quezon City to annotate on the respective transfer certificates of titles (TCT) and the freezing of several of Santos’ properties until the duration of the freeze order.

Among these assets were a property located at no. 50 Purdue St. cor. Ermin Garcia in Cubao, QC; and a 25-hectare property in Barangay Mal-Ong in Anda, Pangasinan.

The BPI Family Savings Bank in Kalentong, Mandaluyong was likewise ordered to continue to freeze Account no. 5036217881 under the name of Ricardo Ayeras, and all related web accounts.

Source: GMANews.TV

Sabtu, 19 Mei 2012

Toronto non-profit raised millions for Tamil Tigers

Stewart Bell, National Post

A Toronto non-profit group wired more than $3-million to overseas bank accounts, some of them linked to the Tamil Tigers, before it was shut down by the government in June for alleged terrorist financing, says an RCMP report released yesterday.

The report, marked "Secret" but unsealed by order of a Federal Court judge, provides the first detailed look at the banking activities of the World Tamil Movement (WTM), a Toronto-based group accused of bankrolling Sri Lanka's Tamil Tigers guerrillas.

Most of the money, $1.9-million, went to an account at the Bumiputra Commerce Bank in Kuala Lumpur, Malaysia, that the RCMP report says "is utilized as a vehicle to forward money to the LTTE [Liberation Tigers of Tamil Eelam] from Canada."

The 83-page financial report is the fruit of two years of analysis of banking records seized by Canadian anti-terrorism police who are investigating a financial network run by supporters of the Tamil Tigers that allegedly raised money in Canada to buy arms for the guerrillas.

"The bank records seized ... demonstrate that the World Tamil Movement has developed an elaborate machine like entity that moves throughout the Greater Toronto Area collecting funds with extreme proficiency," the police report says.

Stockwell Day, the Public Safety Minister, announced on June 16 that his government had added the WTM to Ottawa's official list of terrorist groups, alongside the likes of Al-Qaeda, Hamas and Hezbollah. The WTM is the first Canadian community group to be listed.

The WTM has denied any involvement in terrorist fundraising and vowed to challenge the government's decision, and at a large outdoor rally in Toronto on July 5, Tamils waved Tamil Tigers flags and endorsed a statement condemning Ottawa's decision to ban the WTM.

The Minister has accused the WTM of transferring money to LTTE bank accounts in Sri Lanka, but the RCMP's Feb. 1, 2008, financial report paints a more detailed picture of a complex network made up of 20 Canadian bank accounts.

Five banks held the accounts: Toronto Dominion, Bank of Nova Scotia, Royal Bank, CIBC and the National Bank of Canada. The Canadian account holders wired money regularly to accounts in Malaysia, Singapore, the United Kingdom and Tamil Tigers-controlled areas of Sri Lanka.

RCMP Corporal Deanna Hill, the author of the police report, wrote that the WTM's financial set-up was "congruent with the money laundering techniques often employed by organized crime groups.

"I also believe that the number of accounts alone demonstrate that the World Tamil Movement has utilized the Canadian banking system to raise funds in a manner that is best suited to financing the terrorist activities of the LTTE."

The Tamil Tigers have been fighting for 25 years for an independent homeland for Sri Lanka's ethnic Tamil minority, which has faced discrimination under the island's Sinhalese majority.

In addition to fighting a conventional guerrilla war, however, the Tigers also employ terrorist tactics, such as suicide bombings and political assassinations, which has landed them on international terrorist lists, Canada's included.

The RCMP began investigating the Tamil Tigers' Canadian fundraising network in 2002, focusing on the WTM's large head office in Toronto and its smaller branch offices in Montreal and Vancouver. Police raided the Toronto and Montreal offices in 2006.

Police seized letters from the Tamil Tigers leadership thanking Canada for its donations, explaining how the money had been used to purchase weapons, and asking for more. But much of the police evidence appears to have come from a study of bank accounts held by the WTM and its officers.

The Project Osaluki financial report claims the WTM's most lucrative fundraising method was a pre-authorized payment program, in which the group persuaded hundreds of its supporters to sign forms allowing money to be withdrawn from their bank accounts each month.

The WTM took in up to $763,000 a year using the payment scheme. On a single day in 2005, the WTM withdrew $63,528 from 1,582 bank accounts. "It is obvious from the amounts collected with this method that the pre-authorized payment scheme is effective, timely and spares valued resources," says the RCMP report.

Most of the forms had been signed in Canada but police also interviewed witnesses who said they had signed them at Tamil Tigers checkpoints in Sri Lanka. "Upon their return to Canada, these persons were visited by representatives of the World Tamil Movement to exact the collection of the monthly stipend," Cpl. Hill wrote.

In addition, the WTM made money through bake sales, car washes, newspaper sales, merchandise sales and festivals, the report says. "To date, the total amount of Canadian dollars that have been forwarded to accounts internationally from accounts controlled by the World Tamil Movement in Canada is $3,101,803.33."

Source: National Post