Bangladesh:Banking for Terror | Pakistan: KP: Complicit Murders | South Asia Intelligence Review (SAIR), Vol. No. 11.19
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SOUTH ASIA INTELLIGENCE REVIEW
Weekly Assessments & Briefings
Volume 11, No. 19, November 12, 2012

Data and assessments from SAIR can be freely published in any form with credit to the South Asia Intelligence Review of the
South Asia Terrorism Portal


ASSESSMENT


BANGLADESH
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Banking for Terror
Sanchita Bhattacharya
Research Associate, Institute for Conflict Management

In what seems a logical culmination of events, Bangladesh has been given time until February 2013 to address deficiencies in its fight against money-laundering and terror-financing to avert black-listing by the Financial Action Task Force (FATF). The deadline was set at the FATF meeting held at Paris between October 15 and 19, 2012. FATF is an inter-governmental body established in 1989 with the objectives of setting standards and promoting effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.

Under this mandate, Bangladesh needs to adequately address the issue of criminalising terror financing and establish and implement procedures to identify and freeze terror assets, and to remove deficiencies in its anti-money laundering (AML) legislation and apparatus, to effectively combat the financing of terrorism.

After the FATF meeting, one of the members of the four member team from Bangladesh, headed by Additional Finance Secretary, Ranjit Kumar Chakraborty, stated, on October 22, 2012, “We are making preparations for addressing these deficiencies within the timeframe, set by the FATF… The Government may consider amending the existing Anti-Terrorism Act in line with the global standard to adequately address criminalizing terror financing.” Earlier, in 2009, Bangladesh promulgated the Anti-Terrorism Act, including provisions to tighten controls on terrorist financing in the country.

Internationally, the financing of terrorism was criminalized under the United Nations International Convention for the Suppression of the Financing of Terrorism, in 1999. To reinforce the 1999 Convention, the United Nations adopted UNSC Resolutions 1373 and 1390, directing member states to criminalize terror finance and adopt regulatory measures to detect, deter and freeze terrorists’ assets. The resolutions oblige all states to deny financing, support and safe harbour to terrorists.

Unfortunately, despite these conventions and resolutions, the U.S. Senate Permanent Subcommittee on Investigation, in its July 17, 2012, report titled U.S. Vulnerabilities to Money Laundering, Drugs and Terrorist Financing: HSBC Case History, disclosed that two Bangladesh-based banks, Islami Bank Bangladesh Limited (IBBL) and Social Islami Bank Limited (SIBL) were involved in terror financing. Regarding the functioning of HSBC, it was mentioned that the bank acted as a financier to clients seeking to route funds from countries like Mexico, Iran, Saudi Arabia, Syria, North Korea, Cuba, Sudan, Myanmar, Japan and Russia. The report also stated that the HSBC supplied dollars to IBBL and SIBL, ignoring evidence of their links to terror financing. HSBC did not submit these two banks to enhanced monitoring for suspicious transactions, despite recommendation by HSBC’s own Financial Intelligence Group (FIG).

According to the document, SIBL’s ownership stakes were held by two Saudi Arabia based non-governmental organizations (NGOs): the International Islamic Relief Organization (IIRO) - implicated in terrorist financing by the U.S. administration and included on the list of those prohibited to do business in the country; and Lajnat-al-Birr-al-Islam (Benevolence International Foundation, BIF), one of al Qaeda’s financers.

It was noted, further, that Saudi Arabia’s Al Rajhi Bank, also engaged in suspicious transaction, had a 37 per cent ownership in IBBL. HSBC also had maintained an association with Al Rajhi, a member of al Qaeda’s “Golden Chain” – a list including at least 20 top Saudi and Gulf States’ financial sponsors of al Qaeda, including bankers, businessmen, and former ministers.

The U.S. report on terror financing was not a recent finding. Since 9/11, the U.S. has taken strong steps to halt the flow of funds to terrorist organizations under Executive Order 13224 and related elements of the USA Patriotic Act.

The exposure of the unholy nexus between banking establishments and terrorist activities in Bangladesh can be traced back to the watershed country-wide serial bomb blasts on August 17, 2005. 459 explosions had been orchestrated in 63 of the country’s 64 Districts (excluding Munshiganj), killing three persons and injuring 100 others, on that date. After the serial blasts, which were orchestrated by the Jamaat ul-Mujahideen Bangladesh (JMB), the role of IBBL in promoting religious terror was brought under scrutiny, when Bangladesh Home Ministry constituted a committee to investigate terror financing. Subsequent to the arrest of the JMB ‘chief’ Shaikh Abdur Rahman and his second in command Siddiqui Islam alias Bangla Bhai, and the subsequent seizure of some banking documents, the investigation team documented suspicious transactions with IBBL branches in Sylhet, Gazipur and Savar, where violations of the Anti-Money Laundering Act were noticed. The Act which came into existence in 2002 was last amended on June 20, 2011.  Rahman and Bangla Bhai were also found to have accounts with IBBL. The two were eventually hanged on March 30, 2007 – Rahman in Comilla Jail and Bangla Bhai in Mymensingh Prison.

IBBL was also found to be linked with the Kuwait based Islamic NGO, Revival of Islamic Heritage Society (RIHS), whose bank accounts in Pakistan were closed following 9/11. In Bangladesh, RIHS’s account with IBBL was closed in 2006, following revelations that, in November 2005, RIHS released BDT 20 million to facilitate suicide bombers in Bangladesh. Incidentally, Bangladesh experienced a suicide bombing on December 8, 2005, in Netrokona District, in which eight persons were killed and 46 were injured. In addition, two officials of RIHS, one from Sudan and the other from Yemen, were deported in 2006 for having channeled from Bangladesh over USD 700,000 to local and foreign terrorist organisations. Apart from the RIHS connection, linkages were also discovered to Yassin Qadi, a Saudi Arabian businessman and son-in-law of Sheikh Ahmed Salah Jamjoom, a foreign sponsor of IBBL. IBBL is also believed to have been closely tied to the August 17, 2005, serial bombings across Bangladesh.

Interestingly, Tarique Rahman, the son of Khaleda Zia (Chairperson of Bangladesh Nationalist Party, BNP and then Prime Minister), and the former vice-president of BNP, was also believed to be involved in suspicious money laundering operations. Reports indicate that Rahman and his associate Giasuddin al-Mamun, Managing Director of Channel-1 Television, were involved in money laundering, with Rahman linked forward to Dawood Ibrahim, the principal accused and fugitive in the March 12, 1993, serial blasts in Mumbai, India. 

SIBL has purportedly been engaged in Shariah (Islamic Law) based banking in the country. Its Executive Vice President, Shawkat Ali, was apprehended by Kolkata (West Bengal, India) Police and was expelled from Kolkata in August 2006 for his involvement in undesirable and suspicious activities. SIBL is suspected to be engaged in routing funds to Kolkata, and from there to other destinations in India and abroad. SIBL’s principal patrons are known to be from the Middle East.

Investigation of the financial operations of terrorist groupings such as JMB and Harkat-ul-Jihad-al Islami Bangladesh (HuJI-B) discovered that a major chunk of their funding came from Pakistan through hawala (illegal money transaction) channels. Terrorist organizations also received regular funds from expatriate populations working in the US, Europe and Middle East. A pro-Pakistani Political party – Jamaat-e-Islami (JeI), Bangladesh, was found to be a frequent medium for foreign funding. Funds were reportedly transferred into JeI’s account with IBBL, and were then distributed to various terrorist outfits in the country. JeI was a coalition partner in Khaleda Zia’s Government.   

Responding to growing international pressure after 9/11, the Bangladesh Government formed a central and regional taskforce on January 27, 2002, to deal with money laundering and terrorist finance. Subsequently, a Financial Intelligence Unit (FIU) was also established in Bangladesh Bank on May 16, 2007. A document titled National Strategy for Preventing Money Laundering and Combating Financing of Terrorism 2011-2013, outlines the Government’s present strategy to deal with the problem, and defines its mission, “To bring the anti-money laundering/combating of financing terror system and procedures of Bangladesh in full convergence with international best practice standards set by FATF and other multi-lateral forums”.

In November 2010, the National Coordination Committee, comprising all agencies dealing with anti-money laundering and finance related issues, was established. In addition, the Money Laundering Prevention Act (MLPA), 2012, was promulgated, repealing the Money Laundering Prevention Act, 2009. Similarly, the Anti Terrorism (Amendment) Act, 2012, has been promulgated, amending the Anti Terrorism Act, 2009, to meet international standards and to establish an effective regime in Bangladesh to deal with terror funding.

Unfortunately, as recent revelations, including those by the US Senate Subcommittee reiterate, such illegal activities continue in Bangladesh. Despite a sharp decline in Islamist terrorism related incidents and fatalities, Islamist extremist mobilization and radicalization continue in the country, and substantial flows of funds to groups connected with terrorist continues. Some linkages between Islamic Banking and terrorist organizations have now been brought into the open, but the networks have not been dismantled. In a country with a strong Islamist extremist constituency, and an intricate web of collusive relations with major political formations, as well as with significant financial organizations, potent clusters of a residual threat continue to exist. The Sheikh Hasina Government has taken dramatic steps to target and neutralize these subversive networks, with significant success. There is, however, a long struggle ahead before the threat is fully neutralized.

PAKISTAN
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KP: Complicit Murders
Tushar Ranjan Mohanty
Research Associate, Institute for Conflict Management

While hearing the suo motu notice on the recovery of dead bodies stuffed in gunny bags in Peshawar, the provincial capital of Khyber Pakhtunkhwa (KP), and its suburbs, the Peshawar High Court, on November 6, 2012, directed the KP Police to track down the people responsible for dumping bodies by December 18, 2012. A two-member bench, comprising Chief Justice Dost Muhammad Khan and Justice Waqar Ahmad Seth, informed that so far the Court had received post mortem reports of 26 recovered corpses. It also reprimanded the Director General Health, Sharif Khan, observing that doctors had filed forged autopsy reports, giving starvation as the reason for most of these deaths.

A report about the cases had been prepared by the High Court’s Human Rights Cell, which was later turned into a human rights petition on August 16, 2012. The Peshawar High Court on the same day took suo motu notice of the incidents based on the report. The Chief Justice then had stated that during the last one month 116 dead bodies were recovered from different areas of the provincial metropolis.

Earlier, on October 30, 2012, a Bench of the Peshawar High Court had sought an explanation from the Inter-Services Intelligence (ISI) Director General, Lieutenant General Zaheer ul-Islam, and KP Home Secretary Azam Khan, on the killing of Zahoorullah Khan, allegedly in the custody of the enforcement agencies. The Bench, comprising of the acting Chief Justice Miftah-ud-Din Khan and Justice Waqar Ahmad Seth, asked the two to explain under what law Zahoorullah Khan had been picked up and under what circumstances he was killed. Zahoorullah Khan’s father, Haji Mir Aslam Khan, had moved the Court, claiming his son had been taken away by plainclothesmen accompanied by the Police from his hujra (guest house) in the Matani area of Peshawar on August 24, 2012. The father submitted that after two months, the local Police handed him body of his son for funeral.

Hearing another case on the same day, the Bench directed the Station House Officer (SHO) of Takht Bhai Police Station in Mardan District to complete investigations into the killing of Mohammad Riaz, whose father, Mohammad Ayub, had filed a petition stating that his son went missing on June 1, 2011, from the Takhtbhai area. On June 27, 2012, his body was recovered in the Haripur town of the same District. Mohammad Ayub stated that his son’s neck was broken, his body had marks of severe torture and was riddled with bullet holes.

The problem of torture and illegal executions, apparently by state agencies, is compounded by frequent illegal detention and rising numbers of ‘missing’ persons. Official documents conceded that 676 persons had ‘disappeared’ in Pakistan between January 1, 2011 and September 12, 2012.  These include 241 from KP; 244 from Punjab; 99 from Sindh; 48 from Balochistan; 27 from the Federally Administered Tribal Areas (FATA); and 16 from ‘Azad Kashmir’. However, the Supreme Court-appointed commission on missing persons disclosed, on October 2, 2012, that the number of missing persons during this period was significantly higher, at 852.

On October 22, 2012, the Peshawar High Court had directed the Federal Ministry of Defence as well as the Federal Ministry of Interior Affairs to submit replies with sworn affidavits of senior officials in some 55 habeas corpus petitions challenging the alleged illegal detention of the scores of people by enforcement and intelligence agencies in Peshawar (KP). The Bench, comprising of acting Chief Justice Miftah-ud-Din Khan and Justice Waqar Ahmad Seth, directed the representatives of the Federal and Provincial Governments to make efforts to trace the missing persons. Significantly, most of the habeas corpus petitions were filed by women against the enforced disappearance, principally, of their husbands or sons. In their petition they had claimed that their cases had seen no progress over extended periods of time.

Before this, on October 4, 2012, the Court directed the Federal Ministry of Defence as well as Federal Ministry of Interior Affairs to provide the list of secret detention centres run by the ISI, Military Intelligence (MI), Frontier Corps (FC) and other agencies. The Bench stated that, under the law, any detention centre run by the enforcement or intelligence agencies that was not listed and notified was illegal. The Bench observed that the intelligence agencies pretended ignorance even after petitioners brought evidence on record that the missing persons had been picked up by or handed over to the personnel of these agencies. The Bench passed the directives after both the ISI and MI expressed their ignorance, in their affidavits, regarding the whereabouts of the missing persons.

The complicity of Government agencies in the unaccounted killings and detentions is thus quite clear. On July 10, 2012, the Peshawar High Court noted unambiguously:
As a last resort, the Ministry of Defence is directed to retrieve missing persons from the clutches of the Military Intelligence otherwise the Court would be constrained to take action under both the civil and military law.

Further, on March 20, 2012, a Bench of the High Court had directed the National Accountability Bureau, KP, to conduct an inquiry against the SHO of Hayatabad Police Station in Peshawar, Rajab Ali, suspected of being involved in extortion from detainees kept at illegal detention facilities. In one such case, in a petition filed on April 11, 2012, Shamor Rehman, a businessman, claimed that the SHO detained him at the Hayatabad Police Station and demanded PKR 600,000 for his release. He said that the SHO made him pay PKR 175,000, adding that his father had also paid PKR 200,000 to secure his release. Meanwhile, on April 10, 2012, the Bench revealed that three illegal detention facilities, allegedly run by the Rajab Ali had been discovered within the jurisdiction of the Hayatabad Police Station. “The illegal detention centres were used to extort money from the detainees,” the Court observed. The SHO has now been sent to the Police Lines under the Court’s directives.

During its hearing on November 6, 2012, the KP Police told the Peshawar High Court that they had registered cases against ‘unknown persons’ for the murders in the case of the recovery of dead bodies in the Province, and had recorded statements of the victims’ legal heirs. Additional Inspector General (Investigation) Idrees Khan, however, argued, “Just one person has alleged in his statement that the Armed Forces are responsible for the murders.”

It is not surprising, consequently, that the affected people, as a last resort, are approaching the Courts in the hope of some relief. The rise in such incidents only adds to the misery that the Province is facing as a result of terrorism and sectarian violence. According to partial data compiled by the Institute for Conflict Management, at least 11,782 persons, including 3,986 civilians, 1,465 SF personnel and 6,331 ‘militants’ have been killed in terrorism-related incidents since 2005 (all data till November 11, 2012). The number of fatalities for the current year stands at 586.

These problems of illegal detention and killings have also drawn the attention of the international community. Concluding its 10-day visit to Pakistan on September 20, 2012, the UN Working Group on Enforced or Involuntary Disappearances (WGEID) acknowledged the incidents of enforced disappearances across Pakistan, and recommended that the Government should act to improve the situation at the earliest. The UN working group urged the Government to set up an officially recognized place of detention; to reinforce the commission of inquiry to enable parallel hearings; to assist families to meet the commission in the absence of members of the enforcement agencies; to include the new crime of enforced disappearances in criminal code; to ensure fair trial and punishment for perpetrators; to suspend the perpetrators, including army officers, from their official duties during the probe; to ensure accountability of law enforcement agencies; to train law enforcement and intelligence agencies in the human rights field; to ensure protection of witnesses and relatives of abducted persons; to provide financial aid to relatives of missing persons; and to ratify the convention for protection of all persons against enforced disappearances.

There is little hope of these ambitious demands being met in the foreseeable future, given the fractured and flailing nature of Governance across Pakistan. Indeed, whatever little relief the affected individuals and families may receive will only come from the aggressive interventions of the Courts, even as the Army and its covert agencies, as well as the Police, continue to use their considerable extra-constitutional authority to stonewall the courts and evade accountability.


NEWS BRIEFS

Weekly Fatalities: Major Conflicts in South Asia
November 5-11, 2012

 

Civilians

Security Force Personnel

Terrorists/Insurgents

Total

INDIA

 

Arunachal Pradesh

0
0
1
1

Jammu and Kashmir

0
0
4
4

Manipur

0
0
1
1

Meghalaya

2
0
1
3

Nagaland

0
0
3
3

Left-wing Extremism

 

Andhra Pradesh

1
0
0
1

Chhattisgarh

0
1
1
2

Jharkhand

4
3
0
7

Total (INDIA)

7
4
11
22

PAKISTAN

 

Balochistan

12
0
0
12

FATA

6
1
12
19

Khyber Pakhtunkhwa

6
6
3
15

Punjab

4
0
0
4

Sindh

58
5
10
73

Total (PAKISTAN)

86
12
25
122
Provisional data compiled from English language media sources.


BANGLADESH

BSF submits list of militant camps to BGB: The Border Security Force (BSF) has submitted the names and locations of the camps, of militants of Northeast, in Bangladesh to Border Guards of the Bangladesh (BGB during a meeting between the BSF and BGB held at Sylhet from November 5 to 8. BSF Public Relations Officer (PRO), Ravi Gandhi, on November 9 said, "We have given them all the details and they have assured us of taking action against the insurgents." The Shillong Times, November 10, 2012.


INDIA

Terrorist outfits investing in Indian stock markets, says UMHA Sushil Kumar Shinde:Terrorist outfits are investing in the Indian stock market through spurious companies, Union Minister of Home Affairs (UMHA), Sushil Kumar Shinde said at an Interpol General Assembly meeting in Rome (Italy) on November 5. Shinde commented, "Credible intelligence suggests that terrorist outfits are investing in stock markets through spurious companies, setting up fictitious businesses and laundering money". The EconomicTimes, November 6, 2012.

Kukis threaten to resume armed struggle, says report:The Kuki National Organisation (KNO), an umbrella organization of 16 Kuki outfits, threatened to resume armed struggle and secede from Manipur if the Centre did not begin talks with them. However, KNO leaders stressed they want a solution within the Constitution's framework. The seven-year-old Suspension of Operations (SoO) agreement between the KNO and the Government of India ends on November 22. "If the government does not begin talks with us before November 22, we will be forced to take up arms. Does the Government of India want an armed rebellion?" said Seilen Haokip, KNO spokesperson in New Delhi. In 2005, KNO signed the SoO with the Centre leading to a ceasefire. Currently, KNO has about 2,000 armed cadres. Times of India, November 3, 2012.


PAKISTAN

58 civilians and 10 SFs among 73 persons killed during the week in Sindh: At least 19 persons, including six students of Deobandi School of thought, were killed in separate incidents of violence in Karachi, the provincial capital of Sindh, on November 10.

Three persons were killed in separate acts of violence in Karachi on November 9.

Six persons, including two Shia men and a Policeman, were killed in separate acts of violence in Karachi on November 8.

At least three Rangers personnel were killed and 14 others injured in a suicide attack outside the Sachal Rangers Headquarters in North Nazimabad Block B area of Karachi on November 8.

13 persons, including five Shia men, were killed in separate incidents of target killing in Karachi on November 7.

15 persons, including three Bohra community members, were killed in separate incidents in Sindh on November 6.

Three people, including two activists of Muttahida Qaumi Movement (MQM), were killed in separate incidents of violence in Karachi on November 5. Daily Times; Dawn; The News, November 6-12, 2012.

UN orders global sanction against Haqqani network: The UN Security Council on November 5 ordered global sanctions against the Haqqani Network in Afghanistan and its chief suicide attack organiser Qari Zakir. Haqqani and Qari Zakir were added to the UN's Afghanistan-Taliban sanctions list. US put the Haqqani network on its terror blacklist in September 2012. The network has been widely linked to Pakistan. Dawn November 6, 2012.

Mullah Fazlullah hiding in Afghanistan, confirm US officials: According to a report, the US officials have confirmed that Mullah Fazlullah, a 'commander' of the Tehreek-e-Taliban Pakistan (TTP), is hiding in Afghanistan. The report stated that the TTP leader has escaped retribution by hiding in a section of eastern Afghanistan where the US forces are present but focused on other targets. Tribune, November 7, 2012.

CoAS General Ashfaq Parvez Kayani warns SC judges not to cross the limit and undermine military: The Chief of Army Staff (CoAS) General Ashfaq Parvez Kayani on November 5 warning Supreme Court (SC) judges said that that any effort to undermine the military and "draw a wedge" between it and its citizens would not be tolerated. "Any effort which wittingly or unwittingly draws a wedge between the people and Armed Forces of Pakistan undermines the larger national interest," said General Ashfaq Kayani. The SC Chief Justice Mian Iftikhar Chaudhary in October 2012 had ruled that the military must stop interfering in politics. Daily Times, November 6, 2012.

Fuel supply to NATO troops via Torkham border check-post restored: The supply of fuel to NATO troops through the Torkham border post, which lies in the Khyber Agency of Federally Administered Tribal Areas (FATA), resumed on November 7 after one year when two oil tankers crossed into Afghanistan amid tight security. The fuel supply remained suspended despite resumption of overall supplies in July 2012 after the US apologised to the Government over the killing of 24 Pakistani soldiers in a NATO air strike on the Salala checkpost in Mohmand Agency on November 26, 2011. Dawn, November 8, 2012.


The South Asia Intelligence Review (SAIR) is a weekly service that brings you regular data, assessments and news briefs on terrorism, insurgencies and sub-conventional warfare, on counter-terrorism responses and policies, as well as on related economic, political, and social issues, in the South Asian region.

SAIR is a project of the Institute for Conflict Management and the South Asia Terrorism Portal.

South Asia Intelligence Review [SAIR]

Publisher
K. P. S. Gill

Editor
Dr. Ajai Sahni


A Project of the
Institute For Conflict Management



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