Aug
06

HSBC Under Fire For Relationship With Al Rajhi Bank

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Indian media is reporting on a U.S. Senate investigation into the London-based HSBC banking and financial services conglomerate found serious issues with the firms anti-money laundering compliance department including supplying currency to Saudi Arabia’s Al Rajhi Bank, which, the report said, has links to financing terrorism. According to an Economic Times report:

… HSBC in 2009 authorised its affiliate to supply Indian rupees to Saudi Arabia’s Al Rajhi Bank, which, the report said, has links to financing terrorism. The report also said that Al Rajhi Bank handled IIRO’s (International Islamic Relief Organisation) ‘charitable contributions intended to benefit suicide bombers by directing Al Igatha Journal advertisements … in Somalia, Sri Lanka, India, and the Philippines.’ It cited a lawsuit to say that charitable organisations such as the IIRO use banks like Al Rajhi Bank to ‘gather donations that fund terrorism and terrorist activities’ under the guise of IIRO funds labeled and designated for purposes such as ‘war and disaster’ or ‘sponsor a child’. IIRO is a Saudi-based nonprofit organisation which was added to the SDN list by the United States for ‘facilitating fund raising for Al Qaida and affiliated terrorist groups,’ the report said, while adding that HSBC’s internal Financial Intelligence Group (FIG) itself had raised questions about IIRO in 2003. SDN (Specially Designated Nationals) List, published by the US governmandent, names individuals and entities with whom US citizens are prohibited from doing business. Again in 2006, an FIG report noted that ‘the IIRO had been linked to al-Qaida and other terrorist groups, plots to assassinate President Bill Clinton and the pope, attacks on the Brooklyn Bridge and Lincoln Tunnel, and the 1993 attack on the World Trade Center,’ the report said. It further said that Al Rajhi Bank had gained notoriety as well for providing banking services to several of the hijackers in the 9-11 terrorist attack, including Abdulaziz al Omari who was aboard American Airlines Flight 11.

The now-defunct SAAR Foundation was a Northern Virginia Islamic charity that was thought to have been funded largely by the Al Rajhi family and received substantial attention in 2002 when many of the organizations linked to SAAR were raided by federal authorities in a terrorism investigation. In July 2007, a post reported that the Wall Street Journal had  gained access to new intelligence documents detailing the how the Saudi Al Rajhi Bank had maintained accounts and accepted donations for Saudi charities designated as Al Qaeda terrorists fronts:

The U.S. intelligence reports, heretofore secret, describe how Al Rajhi Bank has maintained accounts and accepted donations for Saudi charities that the U.S. and other nations have formally designated as fronts for al Qaeda or other terrorist groups. In addition, Mr. Al Rajhi and family members have been major donors to Islamic charities that are suspected by Western intelligence agencies of funding terrorism, according to CIA reports and federal-court filings by the Justice Department. A 2003 CIA report claims that a year after Sept. 11, with a spotlight on Islamic charities, Mr. Al Rajhi ordered Al Rajhi Bank’s board “to explore financial instruments that would allow the bank’s charitable contributions to avoid official Saudi scrutiny.” A few weeks earlier, the report says, Mr. Al Rajhi “transferred $1.1 billion to offshore accounts — using commodity swaps and two Lebanese banks — citing a concern that U.S. and Saudi authorities might freeze his assets.” The report was titled “Al Rajhi Bank: Conduit for Extremist Finance.”

As detailed by a Hudson Institute report, the SAAR Foundation was intimately related to the International Institute of Islamic Thought (IIIT), a part of the U.S. Muslim Brotherhood. 

The IIRO is an affiliate of the Muslim World League (MWL) which was established in 1962 as a means for the propagation of Saudi “Wahabbi” Islam. Muslim Brothers played an important role in its founding and, to date, the League has been strongly with the Brotherhood. The MWL, together with the World Assembly of Muslim Youth (WAMY), are Saudi organizations believed by U.S. government officials to have helped to spread Islamic extremism around the world as well as sponsoring terrorism in places such as Bosnia, Israel, and India. In 2006, the U.S. Treasury Department designated the Philippine and Indonesian branch offices of the IIRO as well as one of its executives in connection with fundraising for al-Qaeda and al-Qaeda affiliates. Previous posts have discussed the history of the IIRO in the US, its ties to the US Muslim Brotherhood as well as the registration of its new US office in Florida, and its new international image campaign.

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