A Court Case to Illustrate that Card Fraud Funded Terrorism

November 30, 2015 by Denise Hutchings

Financial Institutions Undeniably Have a Role to Play in the Fight Against Terrorist Financing

I recently studied several court cases that involved loan fraud and/or card fraud to fund terrorism. Details in one particular indictment which was unsealed less than a month ago speak blatantly to the defendants’ intentional exploitation of U.S. financial institutions. The charges include not only conspiracy to commit bank fraud but also providing material support and resources to terrorists.

I have shared select highlights from that case in this article including verbatim communications between the co-conspirators (e.g. an email which makes reference to “if l can max out my cards with hostile intent, and tell the US banks to take a hike.”). I have included this supplemental material in a form that is neither paraphrased nor edited with the hope that reading it directly fuels the vigilance of bankers for their critically important counter-terrorist financing efforts.

“In today’s world, Kansas is not far removed from the battlefields of the war on terror.” (U.S. Attorney Barry R. Grissom of the District of Kansas)

The indictment charges four men, ages 35-40, with conspiring to travel to Yemen to provide thousands of dollars to Anwar Al-Awlaki, a known terrorist, to support violent jihad against U.S. military personnel in Iraq, Afghanistan and throughout the world. Awlaki, a dual citizen of the United States and the Republic of Yemen, was a key leader of Al Qaeda in the Arabian Peninsula who was designated a global terrorist in 2010 and has since been killed.

Although the defendants’ names are publically available information, I have opted not to list them in the article since this case has not yet been prosecuted. I have, however, provided some general background information about the defendants below relevant to the time period outlined in the indictment.

Defendant 1 was an Indian citizen who was an engineering student at Ohio State University and married a U.S. citizen.

Defendant 2 is Defendant 1’s brother. He was an Indian citizen who studied engineering at the University of Illinois Urbana-Champaign; moved to Toledo, Ohio; married a U.S. citizen; and became a lawful permanent resident of the U.S.

Defendant 3 was a U.S. citizen who studied at Ohio State University and became a resident of Overland Park, Kansas.

Defendant 4 is Defendant 3’s brother. He was a U.S. citizen who resided in the Chicago-area until he moved to the Columbus-area.

Indictment References Document Titled “44 Ways of Supporting Jihad”

The indictment highlights a document, “44 Ways of Supporting Jihad”, which was circulated among the defendants and also forwarded to other associates. This document was written by Anwar Al-Awlaki who publicized it via a blog on his website where he provided a link to access the full document.

The two excerpts noted below focus explicitly on funding for terrorism as ways to support jihad.

“Jihad with your wealth:”

“This is to point out to us the importance of the Jihad of wealth because Jihad depends on it: In other words, no money[,] no Jihad, and Jihad needs lots of it… Probably the most important contribution the Muslims of the West could do for Jihad is making Jihad with their wealth since in many cases the mujahideen are in need of money more than they are in need of men.”

“Fundraising for the mujahideen:”

“In addition to paying from your own money you should also encourage others to do the same;”

Opening Credit Cards and Withdrawing Money with No Intent to Repay

Allegations charge that two of the defendants obtained money by applying for and obtaining credit cards from multiple financial institutions. They withdrew money using these cards with no intention of repaying the amounts obtained from the financial institutions. They made various fraudulent financial transactions and also took steps to evade collection efforts.

One of the defendants initially made payments on the credit card accounts in order to ensure the continued availability of credit; however, after using the credit cards to transfer large amounts that put the balances at or near the credit limits, he stopped making payments on the credit card accounts.

Email Messages and Communications between Co-conspirators Discuss Obtaining Funds from U.S. Financial Institutions

The defendants communicated about raising funds for a trip to the Middle East. The indictment also alleges that one of the defendants travelled with two other people to Yemen in July 2009 to meet Anwar Al-Awlaki. They were unable to meet with Awlaki, so travelled to Sana’a, Yemen, to meet with one of his associates and gave the associate approximately $22,000 to be given to Awlaki.

Various email messages between co-conspirators reference “credit cards”, “debit cards”, “check”, “wire”, and “paypal” – all common transaction channels in today’s banking world.

Email Thread between Defendant 1 and Defendant 2 with the Subject Line: “card”

“I applied for yet another card. they’re giving me 5% back for three months. nice timing for me. keep an eye out for it will ya.”

“its not good to apply for too many cards. bad for your credit. but perhaps you don’t care?”

“haha, i don’t except if someone convinces me that its ok to rip them off. then i’d want good credit, so i can get maxed out and disappear this would be the 3rd .. that doesn’t sound too much.”

“btw, i you got a letter in the mail saying they’ve doubled your credit limit for your First American (or something) credit card. so looks like your credit is good so far.”

“i really need to go fatwa [opinion from a Muslim scholar] shopping for that rip off thing…. ”

Email from Defendant 1 to Defendant 2 stating that he wanted to ask an identified Islamic scholar:

“if l can max out my cards with hostile intent, and tell the US banks to take a hike.”

Email between two Unindicted Co-conspirators and Defendant 1 with the Subject Line “Our proposed trip” suggested that they meet to discuss:

“contributions collected so far”

Communication from Defendant 1 to an Unindicted Co-conspirator which stated:

“the brothers are planning to go to yemen on jan 28… I got about $6K so far… I’m meeting the other two brothers tonight… I’ll find out how much they collected as well… and if you have any questions, I can pass them to the Sh [Awlaki].”

Email from an Unindicted Co-conspirator to an individual which thanked him for his “contribution” and spoke about a trip:

“With regards to my trip [to see Awlaki], we intend to leave on the 28th inshaAllah. We are in the process of making our visa documents at the moment. Our collections so far have reached around USD 7000 [$7,000] Alhamdulillah with most of it coming from the US:)!! My personal target is to leave with around USD 10,000 [$10,000] inshaAllah. Do pray for that. I am as excited as ever.”

Email from Defendant 1 to Defendant 2 with the Subject Line “trip” which stated that he just got a ticket and visa to Sana’a:

“if you can raise more funds, that would be good.”

Email Thread between Defendant 1 and Defendant 2 with the Subject Line: “Re: card”

“yeah use it. you could have asked this on the phone, not nice to have things in easily processed text.”

“i tried to word it carefully, but yeah… i guess should be more careful.. which card?”

“I probably maxed the ones you have. I’ll send via paypal.”

Email from Defendant 1 to Defendant 2 with the Subject line “calls” which stated that that he was starting to get telephone calls from a bank to pay back his credit card bill.

“if you ever wann[a] do this, I’d suggest not going over $8K or so per card, and have a bunch of them instead. this way it is not worth the effor[t] per creditor.”

Email Thread between Defendant 2 and Defendant 1 with the Subject Line: “fyi” with a collection notice on behalf of a bank regarding a credit card account held by Defendant 1 attached. The collection notice stated that the amount due on this card was $19,273.65 USD and offered to establish a settlement agreement for payment of the card.

“looks like they’re offering to negotiate.”

“there is nothing to negotiate. :).”

Email from Defendant 2 to Defendant 1 with the Subject Line “c card default”

“apparently if you have an unsecured loan like credit cards, then the creditor can go to court to obtain a means of retrieving their money. the court can them grant them power to go after the debtor’s wages, property or their checking/savings accounts. just wanted to give you the heads up. maybe its best not to keep much money in your account.”

Email Thread between Defendant 3 and Defendant 1 with the Subject Line “Trip”

“I tried to wire some today and, apparently, the routing number is wrong. The lady said there’s a difference between a regular routing number and a wire (transfer) routing number. Do you know anything about that?”

“I have no idea about that. I think it would be easier if you just mail a check to my brother, and he can deposit it in my account.”

Email from Defendant 2 to Defendant 1 with the Subject Line “mailed”

“mailed the sim and debit cards today. hopefully they’ll get there in time.”

Email from Defendant 1 with the subject line “Re: Student loans”

“Of course taking a loan and agreeing to pay interest on it is haram [forbidden]. There’s another opinion that taking a loan from a nation that is at war with Islam while having no intention to repay it or the interest on it is allowed and even commendable as an act of war to weaken the enemy.”

Email Thread between Defendant 2 and Defendant 1 with the Subject Line “so….?”

“how was it?”

“couldn’t meet him, but delivered the goods to a relative.”

We Should Not Underestimate the Magnitude of Seemingly Smaller Dollar Amounts to the Execution of Terrorist Attacks

Financial institutions should not conclude that the relative impact of fraud losses and associated charge-offs is only that to their bottom line. Whereas the $22,000 cited in this case might not be regarded as overly significant if viewed just superficially from the financial vantage point of a banker – the ultimate use of those funds puts it in horrifying perspective.

“The charges in this case outline a plan to send thousands of dollars to a known terrorist, a plan which came to fruition shortly before one of the most notorious attempted attacks in recent memory – an attack claimed by that same terrorist,” said U.S. Attorney Steven M. Dettelbach of the Northern District of Ohio.

In closing, I would like to stress that U.S. officials have stated that they believe groups like al Qaeda and ISIS don’t spend lavishly on attacks. Recent chilling evidence of this is the estimate that counterterrorism experts have indicated for the entire operation of the multi-pronged ISIS attacks on Paris. Officials have said the attacks likely cost $30,000 or less.

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