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Senate Report: UK Bank Dealt Illegally With Iran, Saudi Radicals, and Mexican Drug Dealers

7:25 AM, Jul 24, 2012 • By STEPHEN SCHWARTZ
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But the subcommittee report is especially fascinating in its review of HSBC’s relations with Al Rajhi Bank, the largest private bank in Saudi Arabia. Through all the developments catalogued below, spanning the decade since the terrorist atrocities of September 11, 2001, HSBC “chose to provide Al Rajhi Bank with banking services on a global basis,” according to the subcommittee.

As the report recalls, “After the 9-11 terrorist attack on the United States in 2001, evidence began to emerge that Al Rajhi Bank and some of its owners had links to organizations associated with financing terrorism, including that one of the bank’s founders was an early financial benefactor of al Qaeda.”

The Senate subcommittee cites the 2004 9-11 Commission Report, and references the “Golden Chain,” a roster of “financiers in Saudi Arabia and the Persian Gulf states” involved in supporting Osama bin Laden in the creation of al Qaeda.  

During a search in 2002 by Bosnian government officials at the Sarajevo office of the Benevolence International Foundation (BIF), a Saudi charity designated as a terrorist organization by the U.S. Treasury, the Bosnians seized a CD-ROM and computer hard drive with numerous al Qaeda documents.  The data was soon turned over to the U.S. authorities, and included the hand-written, Arabic-language “Golden Chain” list. Suleiman Bin Abdul Aziz Al Rajhi, a leading executive of the bank named for his family, appeared in the “Golden Chain.”

Suleiman Al Rajhi, as the new subcommittee report reminds us, was also creator in 1983 of the SAAR Foundation, the center of a complex of enterprises in Herndon, Virginia, searched by treasury agents in 2002 during an operation known as “GreenQuest.” The GreenQuest targets encompassed a major network in the U.S. supporting Wahhabism, the ultrafundamentalist Islamist ideology and official sect in Saudi Arabia. 

The subcommittee report quotes extensively from a federal affidavit applying for a search warrant to examine the Herndon properties.  The Safa Trust, another of the GreenQuest targets, had been established in 1996, and replaced the SAAR Foundation, which shut down in 2000.  The Safa “group,” according to the affidavit, directed funds to the Palestinian Islamic Jihad/Shikaki Faction and to Hamas. 

After media coverage in 2002, the GreenQuest investigation languished. As the subcommittee report on HSBC says, “neither the SAAR Foundation or Safa Trust has been charged with any wrongdoing.” But the subcommittee report contains other important details of the labyrinthine aftermath of the GreenQuest action. Some 200 boxes of information collected by treasury agents in GreenQuest were returned to the “Herndon group” after about 18 months, but were subpoenaed again in 2006 by a federal grand jury. The Al Rajhi businesses and nonprofits refused to hand over the materials until a court imposed civil contempt fines on them. 

In 2003, according to the Senate subcommittee, the Central Intelligence Agency produced a classified report entitled “Al Rajhi Bank: Conduit for Extremist Finance.” A citation from the CIA analysis in the Senate subcommittee report affirms, “Islamic extremists have used Al Rajhi Banking & Investment Corporation (ARABIC) since at least the mid-1990s as a conduit for terrorist transactions... Senior Al Rajhi family members have long supported Islamic extremists and probably know that terrorists use their bank…  The Al Rajhis know they are under scrutiny and have moved to conceal their activities from financial regulatory authorities.”  

The Al Rajhi Bank figured in the 2005 indictment of one of its clients, the Saudi-based Al-Haramain Islamic Foundation, a designated terrorist organization operated from Ashland, Oregon, among many places around the world.  Pirouz Sadeghaty, an Al-Haramain official, was convicted of terror financing and sentenced to almost three years in prison. Al Rajhi Bank in 2010 refused to furnish authenticated bank documents for use in the Al-Haramain case. 

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