Cigarette Smugglers Funnel Money to Terror Groups, Report Finds
Tuesday, April 29, 2008 ....By Catherine Herridge
WASHINGTON — Cigarette smuggling is generating millions of dollars every
year that can be reaching terrorist groups, including Hezbollah, Hamas and Al
Qaeda, according to law enforcement sources. In a single case, $100,000 was
sent to Hezbollah.
A 15-page report congressional report, obtained by FOX News, includes
intelligence from law enforcement as well as New York State’s Department of
Taxation and Finance.
The report reads in part: Cigarette smuggling is generating millions of dollars
every year that can be reaching terrorist groups, including Hezbollah, Hamas
and Al Qaeda, according to law enforcement sources. In a single case,
$100,000 was sent to Hezbollah.
“This is a very serious homeland security issue, one that has gone unnoticed
for far too long,” said Rep. Peter King, (R-N.Y.), the ranking member of the
House Homeland Security Committee, who called for the investigation.
“Cigarette smugglers are able to generate millions of dollars in illegal profits
with a great deal of this wealth being sent to terrorist groups overseas –
groups that would like nothing more than to inflict devastating harm on our
country and its citizens.”
See my Post; Saturday, May 31, 2008, POLICE SAY SMUGGLED CIGARETTE CRIME RING PUT OUT OF BUSINESS IN TAMPA SCAM, MAYBE NOT SO MUCH, OLD HABITS HARD TO KICK.
One of the key issues, according to the report, is a potential flaw in New York
State policy. According to King’s office, there is a policy in the state of
“forebearance,” or refusing to collect on sales of Native American tax-free
cigarettes to non-Native Americans.
Critics of the policy say it has effectively created a safe haven for smugglers.
In some cases, the report says, a well-organized operation can buy cigarettes
tax-free on New York’s Indian reservations and sell them at a great profit in
the New York City area, generating up to $300,000 per week with a loss of up
to $576 million in tax revenues to New York State.
According to the report, citing federal and New York state law enforcement
sources, nearly 60 percent of all convenience retail outlets in New York City
are now Arab-owned, primarily families of Lebanese, Yemeni, Jordanian and
Palestinian descent. While the vast majority of retailers are operating above
board, some are not.
The report says that these retailers can funnel their profits from the sale of
cigarettes to terrorist groups in the Mideast. It claims this “tobacco and
terror” relationship has been found in a handful of recent cases.
“…the infamous ‘Lackawanna Seven’ reportedly received funding from an
individual named Aref Ahmed for their travel from Buffalo to Afghanistan to
attend an al Qaeda training camp,” the report says, referring to a group of
American-born men of Yemeni descent who pleaded guilty to terror training.
“The State is losing hundreds of millions of dollars in tax revenue; and given
the current budget shortfall, this would seem to be more than enough reason
to put the so-called policy of forebearance out of its misery,” King said.
“But this is more than just a matter of lost revenue. It is a matter of national
security. Cigarette smuggling in New York State must be brought to an end
Hearings dealing specifically with the report are scheduled this Thursday in
Washington before the House Judiciary Subcommittee on Crime, Terrorism
and Homeland Security.
Bill Warner....Private Investigstor