Monday, April 6, 2009



Shortly after the commission of the terrorist strikes in the US on September 11, 2001, US President George Bush signed Executive Order (EO) No.13224 on September23, 2001, declaring a national emergency to deal with terrorist threats to the USA.He said in his EO: " I also find that because of the pervasiveness and expansiveness of the financial foundation of foreign terrorists, financial sanctions may be appropriate for those foreign persons that support or otherwise associate with these foreign terrorists. I also find that a need exists for further consultation and cooperation with, and sharing of information by, United States and foreign financial institutions as an additional tool to enable the United States to combat the financing of terrorism."

2.The annual report on the Patterns of Global Terrorism during 2001 submitted to the US Congress in May, 2002, by Gen.(retd) Colin Powell, US Secretary of State, described the significance of this EO as follows: "EO 13224 enables the US Government to block designees' assets in any financial institution in the US or held by any US person. It also expands US Government authority to permit the designation of individuals and organisations that provide support or financial or other services to or associate with, designated terrorists. EO 13224 designations allowed the US Government, as well as coalition partners acting in concert, to block tens of millions of dollars intended to bankroll the murderous activities of Al Qaida and other terrorist groups."

3.Under this EO, the US Government has so far designated 322 individuals of different nationalities and organizations as terrorists and terrorist supporters and frozen over $136.8 million in terrorist assets by acting in concert with other member-nations of the UN.Apart from terrorist organisations such as the Al Qaeda, the Jemaah Islamiya, the Harkat-ul-Mujahideen (HUM), the Lashkar-e-Toiba (LET), the Jaish-e-Mohammad (JEM) etc which have been so designated under this EO, a number of individual terrorists wanted for acts of terrorism in different countries have also been so designated. Important amongst them are Osama bin Laden, his No 2 Ayman Al-Zawahiri and other leaders of the Al Qaeda.

4. While the US Government has designated the HUM, the LET and the JEM as Foreign Terrorist Organisations, none of their leaders has so far been designated as global terrorists. The only individuals living openly in Pakistan who had been brought under the purview of this EO till October 15, 2003, were Sultan Bashir-ud-din.Mahmood, Abdul Majeed and Mahammed Tufail, who were suspected of trying to help bin Laden in the clandestine acquisition of weapons of mass destruction (WMD). They were so designated on December 20, 2001, and their bank accounts, wherever found, were ordered to be frozen.

5. Dawood Ibrahim, the mafia leader- cum- terrorist living in Pakistan since the 1990s, became yet another individual terrorist leader living in Pakistan to be brought under the purview of this EO on October 16, 2003, when the US Department of Treasury announced that it was designating him as a Specially Designated Global Terrorist under Executive Order 13224 and that it would be requesting the UN to so list him as well. The designation would freeze any assets belonging to Dawood within the U.S. and prohibit transactions with U.S. nationals. The UN listing will require that all UN Membe-States take similar actions.

6."This designation signals our commitment to identifying and attacking the financial ties between the criminal underworld and terrorism,” stated Juan Zarate, Deputy Assistant Secretary for Terrorist Financing and Financial Crimes. “We are calling on the international community to stop the flow of dirty money that kills. For the Ibrahim syndicate, the business of terrorism forms part of their larger criminal enterprise, which must be dismantled."

7. A press release of the US Department said: "Dawood Ibrahim, an Indian crime lord, has found common cause with Al Qaida, sharing his smuggling routes with the terror syndicate and funding attacks by Islamic extremists aimed at destabilizing the Indian government. He is wanted in India for the 1993 Bombay Exchange bombings and is known to have financed the activities of Lashkar-e-Tayyiba (Army of the Righteous), a group designated by the United States in October 2001 and banned by the Pakistani Government -- who also froze their assets -- in January 2002. "

8. A fact sheet attached to the press release said: "Ibrahim's syndicate is involved in large-scale shipments of narcotics in the UK and Western Europe. The syndicate's smuggling routes from South Asia, the Middle East and Africa are shared with Osama Bin Laden and his terrorist network. Successful routes established over recent years by Ibrahim's syndicate have been subsequently utilised by bin Laden. A financial arrangement was reportedly brokered to facilitate the latter's usage of these routes. In the late 1990s, Ibrahim travelled in Afghanistan under the protection of the Taliban."

9. It added: "Ibrahim's syndicate has consistently aimed to destabilise the Indian Government through inciting riots, acts of terrorism and civil disobedience. He is currently wanted by India for the March 12,1993, Bombay Exchange bombings, which killed hundreds of Indians and injured over a thousand more."

10. It also said: "Information from as recent as Fall 2002, indicates that Ibrahim has financially supported Islamic militant groups working against India, such as Lashkar-e-Tayyiba (LET). For example, this information indicates that Ibrahim has been helping finance increasing attacks in Gujarat by LET. "

11. The statement and the attached fact sheet do not say how the US Government came to know of Dawood's links with the Al Qaeda, bin Laden and the LET. However, it needs to be noted that last week the US Government also designated the Al Akhtar Trust, a supposedly charity organisation based in Pakistan founded by the JEM, for purposes of freezing its accounts under this EO. It described the Al Akhtar Trust as the successor organisation to the Al Rashid Trust, which had earlier been brought under the purview of this EO.

12. The Treasury Department statement indicated that it suspected the Al Akhtar Trust of funding jihadi terrorist activities not only in Pakistan and Afghanistan, but also in Iraq. Since February last, I have been drawing attention to reports that the HUM and the LET have been sending small numbers of their cadres to Iraq to participate in a jihad against the US troops there and that the LET has been collecting funds in Pakistan for assisting the families of its "martyrs" in Iraq.The statement reveals that the JEM has also been indulging in activities in support of the jihad in Iraq through the Al Akhtar Trust.

13.The fact sheet attached by the US Treasury Department to the order relating to the Trust says as follows at two places: "During a custodial interview in early 2003, a senior Al Qaida detainee related that AL AKHTAR TRUST and Al-Rashid Trust were the primary relief agencies that Al Qaida used to move supplies into Qandahar, Afghanistan. " Again it says: "During a custodial interview in mid-April 2003, a senior Al Qaida detainee stated that Al-Rashid Trust and Al AKHTAR TRUST provided donations to Al Qaida."

14. The USA's Federal Bureau of Investigation (FBI) officers in Pakistan had got hold of two senior Al Qaeda operatives during this period---Khalid Sheikh Mohammad,who is suspected to be the mastermind behind the 9/11 terrorist strikes in the USA and who was caught in Rawalpindi in March last, and Walid bin Attash, the principal Al Qaeda suspect in the case relating to the bombing of the US naval ship USS Cole in Aden in October, 2000, who was caught in Karachi in April last.

15. The interrogation of Walid bin Attash by the FBI had not yet started by mid-April. It would, therefore, be reasonable to infer that the action against the Al Akhtar Trust was probably based on information provided by Khalid Sheikh Mohammad. Since the action against Dawood followed two days after the action against the Trust, there is a strong possibility that the information obtained during the same interrogation about his links with the Al Qaeda triggered off the action of the Treasury Department.

16.What next? The designation of Dawood as a global terrorist does not automatically freeze his bank accounts and the accounts of the organisations with which he is associated. It only directs all banks and other financial institutions in the US to identify such accounts and freeze them. How effective is the follow-up action depends on how effective is the identification of the accounts.

17. The Treasury Department order does not give all the aliases of Dawood. It names him as Dawood Ibrahim, also known as Dawood Ebrahim, also known as Sheikh Dawood Hassan. Only all accounts held in these names will be affected by this order. If he has been holding accounts under other names, those would not be affected till identified to be his.

18. The UN Security Council, in its capacity as the monitor of the implementation of its Resolution No.1373 calling for action against terrorism by member-nations, would now be moved by the US to issue instructions to all member-nations, including Pakistan, to freeze the accounts of Dawood held under these three names.

19. Whenever such instructions were issued by the UNSC in the past, the Government of Pakistan circumvented them by alerting organisations and individual terrorist leaders named by the EO and the UN about the impending freezing of their accounts, thereby enabling them to withdraw the bulk of the balance to their credit or transfer it to other accounts under different names.

20.This has been repeatedly happening since January last year. As a result, when the accounts were finally frozen, they were found to contain paltry amounts.

21.The last one year has also seen a tremendous increase in the remittance of funds from overseas bank accounts to accounts in Pakistan. The total remittances during this period were estimated at US $ four billion. The Pakistani authorities attributed this increase to the fact that Pakistanis living abroad have started using normal banking channels for their remittances due to fears that the use of the informal hawala channels as in the past might attract the suspicion of the FBI. Even if this explanation is true, it could account for the transfer of only about US $ 1.5 billion from overseas accounts to accounts in Pakistan.

22. Following suspicion that the steep increase in the remittances flowing into Pakistan might be due to the transfer of the money held overseas by the so-called Saudi charity organisations associated with terrorism to accounts in Pakistan and the use of new accounts in Pakistan by organisations based in Saudi Arabia for funding terrorism, the FBI is reported to be closely monitoring all remittances of over US $ 1,000 to accounts in Pakistan. The Washington correspondent of the "News", the Pakistani daily newspaper, has reported (October 1, 2003) that the Pakistani authorities have agreed to a request from the US to report to the FBI details of all such remittances.

23. The action taken by the Pakistani authorities against all suspected bank accounts in Pakistan continues to be an eye-wash. On June 14,2003, Shaukat Aziz, Pakistan's Finance Minister, placed on the table of the National Assembly a statement giving details of the accounts frozen by the authorities. In the statement figured three accounts in Peshawar banks held in the name of bin Laden and one in the name of his No.2 Ayman Al-Zawahiri (name of the branch not given). Of the three accounts of bin Laden, two were joint accounts held by him along with others and one was an account only in his name. The three bin Laden accounts, according to the statement, had balances of only US $ 306, US $ 342 and US $ 1585 and the account of Al-Zawahiri had a balance of US $ five only.

24.. The statement contained a remark that the account of Al-Zawahiri had remained dormant since 1993. There were no such remarks in respect of the accounts of bin Laden. Hence, they are presumed to have been active. The statement remained silent as to what were the various deposits made in the accounts and withdrawn or transferred from them before they were frozen, who were the beneficiaries etc.

25. According to the same statement, the HUM had three accounts with balances of US $ 62, US $ 48 and US $ 35. The JEM had one account with US $ 14.

26.Over the years, Pakistan, its military dictator Gen.Pervez Musharraf and its Inter-Services Intelligence (ISI) have fine-tuned the art of hoodwinking international community and particularly the US Administration-- whether it be in respect of its clandestine WMD assistance to North Korea and Iran, its sponsorship of cross-border terrorism into India and Afghanistan or evasion of action under the UNSCR No.1373 against terrorists and other organisations.

27. Unless India takes advantage of the slight opening provided by the US designation of Dawood as a global terrorist and acts proactively and aggressively through the UN monitoring mechanism and through bilateral channels to ensure that Pakistan does not again wriggle out of its obligations under the UNSC Resolution 1373, we will find history repeating itself.

28. In my paper No.515 of September 1, 2002, ( "INDIA'S NATIONAL SECURITY MANAGEMENT & 9/11") available at, I wrote as follows: "After 9/11, the purely legalistic approach to the question of blocking terrorist funding has given way to a more pragmatic approach, with actions now being taken by the international community against suspected terrorist accounts even on the basis of strong suspicion instead of waiting, as in the past, till legally sustainable evidence was forthcoming. This should have been taken advantage of by us by moving for the freezing of the bank accounts of Dawood Ibrahim and other members of his mafia group wherever they are held--whether in Pakistan, the UAE, South Africa, Nepal, Thailand or elsewhere. Our plea for action could have been justified on the basis of the strong evidence at our disposal regarding their involvement in the Mumbai blasts of March,1993."

29. In a paper (available at presented at a panel discussion on Terrorism in the Indian sub-continent , organized by the US-India Political Action Committee and the US-India Institute for Strategic Policy at Washington DC on July 16, 2003, I had stated as follows: " About 400 survivors of the 500-strong hardcore of Al Qaeda had crossed over into Pakistan from Afghanistan giving a slip to the US security forces in the beginning of last year. Of these, about 75 are estimated to have since moved over to Yemen and Saudi Arabia and 30 are estimated to have crossed over into Iran via Pakistan’s Balochistan. Of the remaining, about 75 took shelter in Karachi and 220 in Punjab, the North-West Frontier Province (NWFP), Balochistan, the Federally Administered Tribal Areas (FATA), and the Pakistan-Occupied Kashmir (POK). Of the 75, who took shelter in Karachi, about 50 are still holed up in various hide-outs there with the assistance of their Pakistani sympathizers and the mafia gang led by Dawood Ibrahim, who is wanted by the Indian authorities for prosecution in connection with the Mumbai (Bombay) blasts of March,1993, a precursor of mass-casualty or catastrophic terrorism."

30. India should act on the US order and move against Pakistan before it is too late.

31. Annexed is an extract from a paper on terrorism and transnational crime presented by me at a meeting of a working group on this subject held in Shanghai, China, in May last year. "Herald", the monthly journal of the prestigious "Dawn" group, has since come out (August,2003) with more details on the presence of Dawood in Pakistan and his activities there.
(The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, and, presently, Director, Institute For Topical Studies, Chennai. E-Mail: )


Before March 1993, the Dawood Ibrahim group, which indulges in large-scale smuggling, money-laundering and other criminal activities, was operating from Dubai. In March 1993, this group organised at the instance of the Inter-Services Intelligence (ISI) of Pakistan a series of explosions directed at important economic targets in Mumbai---such as the local stock exchange, which is the biggest in India, a local hotel for tourists run by the Air India etc.

Subsequent investigation brought out that the perpetrators of these acts of terrorism, all Indian nationals, had been recruited, at the instance of the ISI, by Dawood Ibrahim in Mumbai, taken to Pakistan via Dubai for training in the use of arms and ammunition and explosives and then sent back to Mumbai via Dubai. The Pakistani Consulate in Dubai issued them plain paper visas so that their passports did not carry any entries of their visit to Pakistan for training. However, Indian investigators managed to get xerox copies of the passenger manifests of the flights by which they went to Pakistan via Dubai for training. After they returned to Mumbai from Pakistan after the training, the explosives and other arms and ammunition required by them for organising the terrorist attacks were sent by the ISI by boat with the help of Dawood Ibrahim and clandestinely landed on the Western coast of India.

After carrying out the explosions, the perpetrators escaped to Pakistan, some via Dubai and some via Kathmandu, and were given sanctuary in Karachi by the ISI. When the Govt. of India took up with the Dubai authorities the question of the involvement of Dawood Ibrahim, the Dubai authorities pressured him to leave their territory. He took shelter in Karachi and has been living there since then along with some of the perpetrators, who have been given Pakistani passports under different names. Repeated requests by the Govt. of India to Islamabad for arresting and extraditing/deporting them to India have been turned down by Pakistan, which denies their presence in Pakistani territory. Red-cornered notices of the INTERPOL for their arrest have not been honoured by Pakistan.

This matter was again taken up by the Govt. of India with President Pervez Musharraf of Pakistan when he visited India in July last. He denied their presence in Pakistani territory. Subsequently, "Newsline", a presitigious Pakistani monthly, in its issue for September, 2001, carried a detailed article on their presence and activities in Karachi. The Pakistani media reported that the journalist who wrote this article (Ghulam Hasnain) was detained and harassed by the Pakistani authorities.

The article stated as follows:" Dawood Ibrahim and his team, Mumbai's notorious underworld clan, including his right hand man Chota Shakeel and Jamal Memon, are on India's most wanted list for a series of bomb blasts in Mumbai and other criminal activities. After the 1993 Mumbai bomb blasts, the gang have made Karachi their new home and operating base. Living under fake names and IDs (identities), and given protection by government agencies, they have built up their underworld operations in Karachi employing local talent like Shoaib and Bholoo.

" In Pakistan, Dawood managed to establish another huge empire, comprising both legitimate and illegitimate businesses. In fact, the last few years have witnessed Dawood emerge as the don of Karachi. Dawood and his men have made heavy investments in prime properties in Karachi and Islamabad and are major players in the Karachi bourse and in the parallel credit system business--hundi. Dawood is also said to have rescued Pakistan's Central Bank, which was in crisis at one point, by providing a huge dollar loan. His businesses include gold and drug smuggling. The gang is also allegedly heavily involved in (cricket) match-fixing. "

The article added: " Not only have the Pakistani authorities turned a blind eye to the gang's activities within Pakistan, but many in the corridors of power have partaken of Dawood's hospitality.....He is said to have the protection of assorted intelligence agencies. In fact, Dawood and his men move around the city guarded by heavy escorts of armed men in civies believed to be personnel of a top Pakistani security agency. A number of Government undercover agents, who came into contact with Dawood because of their official duties, are now, in fact, working for him. Nearly all the men, who surround him for security reasons, are either retired or serving officers, claims an MQM (Muttahida Qaumi Movement) activist."

The article further said: " According to informed sources, Dawood is Pakistan's number one espionage operative. His men in Mumbai help him get whatever information he needs for Pakistan. Rumour has it that sometimes his men in Karachi accompany Pakistani intelligence agents to the airports to scan arriving passengers and identify RAW (Indian external intelligence) agents." (End of citation from the article)

Though the laws of Pakistan do not provide for "economic citizenships", the Pakistan Government informally provides them to international criminals and terrorists, who maintain a minimum dollar deposit in Pakistani banks and help the Government. Dawood Ibrahim, who had reportedly lent money to Pakistan in the past for the clandestine procurement of missiles and connected technology from China and North Korea, has been given informal "economic citizenship" in order to protect him from the arms of the Indian law and provided with a Pakistani passport under a different name .

After the terrorist attack on the Indian Parliament on December 13, 2001, the Govt. of India has given to Pakistan a list of 20 terrorists, wanted for trial in India, who have been given sanctuary in Pakistan. The list includes the names of Dawood Ibrahim and other members of his mafia group wanted for trial in connection with the explosions in Mumbai in March 1993 and other crimes. Pakistan continues to take up the stand that they are not in its territory.

It is alleged that Dawood Ibrahim played an active role in organising the recent referendum campaign of Musharraf in Karachi and in bringing voters to the polling booths in trucks to vote for Musharraf. ( End of extract)

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