Trade-based money laundering (TBML) is widely used by radical Wahhabi Islamic schools or colleges, often misleadingly described in the US and elsewhere as madrasas to fund jihadist groups, US lawmakers have been told.
Several members of Congress heard evidence from former US intelligence officer and Treasury special agent, John Cassara, and professor of criminology and criminal justice at Northeastern University’s College of Social Sciences and Humanities, Nikos Passas.
One so-called madrasa in Pakistan dealt in animal hides as a sideline, Cassara told the lawmakers.
In order to justify the large inflow of funds it is said to have received, the institution claimed to sell a large number of hides to foreign customers at grossly inflated prices.
Illicit fund flows
This allowed the institution to legitimise the inflow of funds, which were then passed to terrorists, claims Cassara.
He told the House Financial Services Committee during a Congressional hearing that the institution was linked to radical jihadist groups and received large amounts of money from foreign sources.
Several committee members expressed concern over the use of TBML in terrorist financing.
“Congress should prioritise efforts to stop the flow of money and resources to terrorist organisations. We must ensure that organisations like the financial crimes enforcement network receive their resources and intelligence necessary to combat trade-based money laundering and other methods of illicit financing,” Congressman Robert Pittenger said.
Cassara maintains TBML for terrorist funding is used mostly in Afghanistan and Pakistan as well as areas of Libya and Somalia.
Categories: Trade Based Financial crimes News