Transcript of Indictment Announcement

1 decade 2 years 9 months ago Wednesday, March 07 2007 Mar 7, 2007 Wednesday, March 07, 2007 11:46:35 AM CST March 07, 2007 in News

THE INDICTMENT UNSEALED TODAY, A REDACTED COPY OF WHICH ALL OF YOU SHOULD HAVE RECEIVED, INCLUDES 33 COUNTS OF:  CONSPIRACY AND SUBSTANTIVE VIOLATIONS OF THE INTERNATIONAL EMERGENCY ECONOMIC POWERS ACT (“IEEPA”) AND THE RELATED IRAQI SANCTIONS REGULATIONS; CONSPIRACY AND SUBSTANTIVE VIOLATIONS OF FEDERAL MONEY LAUNDERING STATUTES; THEFT OF PUBLIC MONEY; OBSTRUCTION OF FEDERAL TAX LAWS, AND FORFEITURE.  THERE IS, INCIDENTALLY, A BREAKDOWN OF THE CHARGES AGAINST EACH INDIVIDUAL DEFENDANT ON PAGE 4 OF THE INDICTMENT.

TO PUT THESE CHARGES INTO CONTEXT, IT’S IMPORTANT THAT YOU HAVE A HISTORICAL FRAME OF REFERENCE.  RECALL THAT IN AUGUST 1990, SHORTLY AFTER IRAQ HAD INVADED KUWAIT, PRESIDENT BUSH THE ELDER ISSUED AN EXECUTIVE ORDER PURSUANT TO HIS POWERS UNDER IEEPA IN WHICH HE DECLARED A NATIONAL EMERGENCY WITH RESPECT TO IRAQ, FROZE THE IRAQI GOVERNMENT’S ASSETS, AND DIRECTED THAT THE SECRETARY OF TREASURY ISSUE REGULATIONS TO ADMINISTER THE EXECUTIVE ORDER.  ACTING UNDER THAT AUTHORITY, THE TREASURY DEPARTMENT THEN ADOPTED A SERIES OF FEDERAL REGULATIONS THAT PROHIBITED, AMONG OTHER THINGS, ANY UNAUTHORIZED TRANSFER OF MONEY OR OTHER FINANCIAL OR ECONOMIC RESOURCES TO IRAQ, WHETHER THE TRANSFER BE DIRECT OR INDIRECT.  VIOLATIONS WERE TO BE MET WITH SIGNIFICANT JAIL SENTENCES AND FINES.

THROUGH ANNUAL EXECUTIVE ORDERS, PRESIDENTS BUSH SR., CLINTON, AND BUSH JR. RENEWED THIS DECLARED NATIONAL EMERGENCY REGARDING IRAQ EVERY YEAR FROM 1990 THROUGH 2003.  FINALLY, IN MAY 2003, SUBSEQUENT TO THE OUSTER OF SADDAM HUSSEIN AND HIS BA’ATH PARTY, THE TREASURY DEPARTMENT EFFECTIVELY SUSPENDED MOST SANCTIONS AGAINST IRAQ.

HAVING PROVIDED THAT BACKGROUND, LET ME NOW TURN TO THE ALLEGATIONS IN THE INDICTMENT, AND FOCUS INITIALLY ON THE IRAQI SANCTIONS COUNTS.  WHAT THE GRAND JURY HAS ALLEGED HERE IS THAT, BEGINNING IN APRIL 1991 AND CONTINUING THROUGH AUGUST 2002, THE ISLAMIC AMERICAN RELIEF AGENCY (“IARA”), OPERATING OUT OF COLUMBIA, PROVIDED HUNDREDS OF THOUSANDS OF DOLLARS IN FINANCIAL SUPPORT TO PERSONS AND ORGANIZATIONS LOCATED IN IRAQ, ALL IN DIRECT VIOLATION OF IEEPA AND GOVERNING TREASURY DEPARTMENT REGULATIONS. 

DEFENDANTS MUBARAK HAMED, ALI BAGEGNI, AHMAD MUSTAFA, AND KHALID AL-SUDANEE ALL PARTICIPATED IN THIS CONSPIRACY ALONG WITH IARA.

HAMED WAS IARA’S EXECUTIVE DIRECTOR, HAVING BEEN DISPATCHED TO THE U.S. IN 1990 BY THE HEAD OF THE ISLAMIC AFRICAN RELIEF AGENCY — WHICH IS HEADQUARTERED IN SUDAN — TO HELP RUN THE ISLAMIC GROUP’S U.S. AFFILIATE, i.e., “IARA”. BAGEGNI SERVED ON THE IARA’S BOARD OF DIRECTORS AT ALL RELEVANT TIMES MUSTAFA WAS A FUNDRAISER FOR IARA WHO CONCENTRATED HIS EFFORTS AT SECURING FUNDS FOR THE GROUP’S IRAQI ACTIVITIES AL-SUDANEE WAS, AND IS, THE DIRECTOR OF THE ISLAMIC RELIEF AGENCY’S REGIONAL OFFICE IN AMMAN, JORDAN.

INCIDENTALLY, I REALIZE THE DIFFERENT NAMES OF THESE ORGANIZATIONS CAN BE A BIT CONFUSING, BUT THE ISLAMIC RELIEF AGENCY IS JUST ANOTHER NAME USED BY THE ISLAMIC AFRICAN RELIEF AGENCY; THEY ARE ONE AND THE SAME.  I MIGHT ADD, MOREOVER, THAT IN OCTOBER 2004,  THE TREASURY DEPARTMENT FORMALLY DESIGNATED THE ISLAMIC AFRICAN RELIEF AGENCY, THE ISLAMIC RELIEF AGENCY, IARA, AND ALL ITS OTHER NAMESAKES — ALONG WITH AL-SUDANEE — AS SPECIALLY DESIGNATED GLOBAL TERRORISTS.  THAT DETERMINATION WAS RECENTLY AFFIRMED BY THE U.S. COURT OF APPEALS FOR THE D.C. CIRCUIT ON FEBRUARY 13.

AS PART OF THE CONSPIRACY TO VIOLATE IEEPA AND THE IRAQI SANCTIONS REGULATIONS, THE DEFENDANTS SOLICITED DONATIONS FOR IARA, TELLING THE PUBLIC THAT ANY CONTRIBUTIONS WERE TAX DEDUCTIBLE.  THE DEFENDANTS ALSO PRODUCED PUBLICATIONS DESCRIBING HOW THE CONTRIBUTIONS WOULD BE DIRECTED TO IRAQ, AND THEY EVEN MAINTAINED DETAILED ACCOUNTING RECORDS OF SUCH EXPENDITURES.  IARA’S ANNUAL REPORTS DOCUMENTED THE IRAQI CONTRIBUTIONS AND ENCOURAGED ADDITIONAL ACTIVITIES THERE.

MECHANICALLY, THE DEFENDANTS HERE IN THE U.S. WOULD WIRE FUNDS TO AL-SUDANEE IN JORDAN, WHO WOULD IN TURN TRANSFER THE MONEY FOR ULTIMATE DISTRIBUTION INTO IRAQ.  IN ORDER TO FACILITATE THESE TRANSACTIONS AND IDENTIFY APPROPRIATE RECIPIENTS, AL-SUDANEE MET FREQUENTLY WITH IRAQI MILITARY AND OTHER IRAQI GOVERNMENT OFFICIALS.  AND THE MONEY JUST CONTINUED TO FLOW.

AT ONE POINT, THE TREASURY DEPARTMENT’S OFFICE OF FOREIGN ASSET CONTROL (“OFAC”) CONTACTED THE IARA AND INQUIRED WHETHER IT WAS VIOLATING THE IRAQI SANCTIONS.  RESPONDING FOR THE ORGANIZATION, MUBARAK HAMED SOUGHT TO DECEIVE THE GOVERNMENT REGULATORS BY CLAIMING —  FALSELY — THAT IARA WAS ONLY ATTEMPTING TO ASSIST IRAQI PEOPLE OUTSIDE OF IRAQ, NOT INSIDE.  THE TRUTH WAS THAT IARA’S INTENTION WAS AT ALL TIMES TO RAISE MONEY FOR IRAQIS AND TO SEND THAT MONEY INTO IRAQ.

NOW ALL OF THIS FINANCIAL ASSISTANCE TO IRAQ, AS MENTIONED BEFORE, WAS IN EXPLICIT CONTRAVENTION OF IEEPA AND TREASURY DEPARTMENT REGULATIONS.  IT ALSO VIOLATED FEDERAL MONEY LAUNDERING STATUTES IN THAT IT INVOLVED THE TRANSFER OF FUNDS FOR THE PURPOSE OF CARRYING ON SPECIFIED UNLAWFUL ACTIVITY.

LET ME TURN NEXT TO THE THEFT OF PUBLIC MONEY COUNT, AND RELATED MONEY LAUNDERING CHARGES IN COUNTS 25-31.  IN 1997, DEFENDANTS IARA, MUBARAK HAMED, AND ALI BAGEGNI ENTERED INTO A SERIES OF CONTRACTS WITH THE U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT (“USAID”) WORTH APPROXIMATELY $2 MILLION.  THE TERMS OF THESE AGREEMENTS SPECIFICALLY PROHIBITED IARA FROM UTILIZING THE MONEY FOR ANY PURPOSE NOT SPECIFICALLY AUTHORIZED IN THE CONTRACTS.  AND ONCE USAID TERMINATED THE CONTRACTS, IARA WAS PRECLUDED FROM USING THE FUNDS FOR ANY PURPOSE AT ALL.  BUT IARA DID JUST THAT.  AND IARA ESSENTIALLY STOLE, ACCORDING TO THE GRAND JURY, NEARLY $85,000 OF FUNDS FROM THE USAID ACCOUNTS — i.e., FEDERAL TAXPAYER DOLLARS.

EVEN MORE DISTURBING, THE INDICTMENT FURTHER ALLEGES THAT IARA USED THAT STOLEN MONEY TO PAY A LOBBYIST IN APRIL 2004 TO TRY TO GET THE IARA OFF A LIST, COMPILED BY THE SENATE FINANCE COMMITTEE IN JANUARY 2004, OF ORGANIZATIONS SUSPECTED OF BEING INVOLVED IN SUPPORTING INTERNATIONAL TERRORISM.  IN UNDERTAKING THIS CORRUPT ENDEAVOR, THE IARA — AND SPECIFICALLY, ITS VICE-PRESIDENT FOR INTERNATIONAL OPERATIONS, DEFENDANT ABDEL AZIM EL-SIDDIQ, HAMED, AND BAGEGNI — EMPLOYED CONCEALED TRANSACTIONS TO DISGUISE THE NATURE OF THE LOBBYING PAYMENTS AND THEREBY PERPETUATE THE UNLAWFUL ACTIVITY.

FINALLY, LET ME ADDRESS THE TAX CHARGES.  THE INDICTMENT ALLEGES THAT FROM 1998 THROUGH 2004, DEFENDANTS IARA AND MUBAREK HAMED OBSTRUCTED FEDERAL TAX LAWS BY IMPEDING THE IRS’ OVERSIGHT OF TAX-EXEMPT ORGANIZATIONS.  SPECIFICALLY, DEFENDANTS MADE MATERIAL MISREPRESENTATIONS — BOTH TO THE PUBLIC AND THE IRS — REGARDING THE IARA’S TAX-EXEMPT STATUS, ITS AFFILIATION WITH OTHER ORGANIZATIONS, AND THE ALLOCATION OF ITS CHARITABLE DONATIONS.

 BEFORE OUTLINING SOME OF THE SPECIFIC CONDUCT PRECIPITATING THIS TAX CHARGE, IT’S IMPORTANT TO UNDERSTAND THAT, BECAUSE TAX-EXEMPT STATUS IS AN ISSUE RIPE FOR ABUSE, CONGRESS IMPOSED A STRICT FILING REQUIREMENT — KNOWN AS FORM 990 — DESIGNED TO ENSURE TRANSPARENT OPERATIONS BY CHARITABLE ORGANIZATIONS.  THESE FORMS 990 CONTAIN A SERIES OF QUESTIONS INTENDED TO DISCLOSE A TAX-EXEMPT ORGANIZATION’S STRUCTURE, LEADERSHIP, AFFILIATIONS, INCOME, EXPENSES, AND ACTIVITIES.  THE IRS USES THIS INFORMATION, ALONG WITH INFORMATION GLEANED FROM A VARIETY OF OTHER SOURCES, TO DETERMINE THE LEGITIMATE ENTITLEMENT OF A PARTICULAR ORGANIZATION TO TAX-EXEMPT STATUS.  FALSE RESPONSES TO THESE INQUIRIES UNDERMINE THE ABILITY OF THE IRS TO FULFILL ITS OBJECTIVE OF DETECTING AND CURBING ABUSES OF THE TAX EXEMPT STATUS.

WITH THAT HAVING BEEN SAID, LET ME PIVOT TO THE DEFENDANTS’ SPECIFIC ALLEGED MISCONDUCT.  THE OBJECTIVE OF THE DEFENDANTS’ CRIMINAL ENDEAVOR WAS TO USE THE IARA’S TAX-EXEMPT STATUS TO SOLICIT DONATIONS FROM THE PUBLIC BY REPRESENTING THAT CONTRIBUTIONS WERE LEGITIMATELY TAX DEDUCTIBLE, AND THEN TO MISUSE THOSE FUNDS BY TRANSFERRING SOME OF THE MONEY TO IRAQ, AND SOME FOR PURPOSES NOT IN FURTHERANCE OF THE ORGANIZATION’S SUPPOSED CHARITABLE MISSION.

IARA AND HAMED FILED IRS FORMS 990 FOR CALENDAR YEARS 1997-2003 WHICH INTENTIONALLY OMITTED THEIR PROHIBITED TRANSACTIONS WITH IRAQ, AND FAILED TO DISCLOSE REQUESTED INFORMATION REGARDING THE CONTROL, HISTORY, AND AFFILIATIONS OF IARA.  FOR EXAMPLE, THE FORMS FAILED TO INCLUDE ANY REFERENCE TO IARA’S AFFILIATION WITH THE ISLAMIC RELIEF AGENCY LOCATED IN JORDAN, OR THE ALTER-EGO ISLAMIC AFRICAN RELIEF AGENCY LOCATED IN SUDAN.

LIKEWISE, IN NOVEMBER 2001, IARA HAD ONE OF ITS AGENTS GO ON CNN AND FALSELY DENY THAT ZIYAD KHALEEL — A THEN PUBLICLY IDENTIFIED ASSOCIATE AND PROCUREMENT AGENT OF OSAMA BIN LADEN — HAD NEVER BEEN AN EMPLOYEE OF IARA.  IN FACT, AS THE DEFENDANTS WELL KNEW, KHALEEL VERY MUCH HAD BEEN AN IARA EMPLOYEE.

IN ADDITION, HAMED REPEATEDLY LIED TO IRS AND OFAC AGENTS IN RESPONSE TO INQUIRIES WHETHER IARA HAD VIOLATED ANY OF THE IRAQI SANCTIONS.  HAMED ALSO LIED TO IRS AGENTS REGARDING HIS EMPLOYMENT HISTORY WITH IARA.  ALL OF THESE FRAUDULENT MISREPRESENTATIONS NOT ONLY IMPEDED THE IRS’ ABILITY TO ENFORCE TAX LAWS VIS A VIS TAX-EXEMPT ORGANIZATIONS, BUT THEY ALSO REPRESENTED A FRAUD ON THE GIFT-GIVING PUBLIC, WHICH RELIES ON IRS FILINGS IN MAKING DECISIONS ON WHERE TO DIRECT THEIR GENEROSITY.

LET ME SAY A COUPLE THINGS IN CONCLUSION.  FIRST, IN THIS GREAT COUNTRY OF OURS, ALL DEFENDANTS ARE PRESUMED INNOCENT UNLESS AND UNTIL PROVEN GUILTY.  THIS PRINCIPLE NATURALLY APPLIES HERE.

SECOND, I WANT TO TAKE A MOMENT TO COMMEND THE TRULY EXTRAORDINARY WORK OF THE LOCAL JOINT TERRORISM TASK FORCE, AND THE MYRIAD LAW ENFORCEMENT OFFICERS WHO HAVE WORKED ON THIS CASE.  FEDERAL, STATE, AND LOCAL AGENCIES HAVE ALL BEEN REPRESENTED. 

THESE CASES ARE COMPLEX, DOCUMENT INTENSIVE LIKE YOU WOULDN’T BELIEVE, AND ENTAIL SENSITIVE INTELLIGENCE MATTERS THAT REQUIRE A SUSTAINED LEVEL OF CONCENTRATION THAT CAN TEST EVEN THE MOST RESOLUTE AGENT.  YET THE AGENTS AND OFFICERS ASSIGNED TO THIS CASE HAVE PERFORMED THEIR JOBS ADMIRABLY.  I’M HERE TO TELL YOU THAT THE DEGREE OF COLLABORATION AND COOPERATION HAS BEEN SIMPLY OUTSTANDING, AND EVEN INSPIRING.  WE HAVE HAD NO TURF BATTLES OR JURISDICTIONAL SQUABBLES.  JUST ESPRIT DE CORPS.  THE CITIZENS OF THIS GREAT DISTRICT CAN, AND SHOULD BE, ENORMOUSLY PROUD OF THE WORK DONE BY LAW ENFORCEMENT ON THIS CASE.

WITH THAT, I’M HAPPY TO ANSWER ANY QUESTIONS.

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