Federal agents launch new raids against financing schemes allegedly used by terrorists

Friday, March 21st 2003, 12:00 am
By: News On 6

WASHINGTON (AP) -- In new raids, federal agents arrested nine people at businesses from New York to California that they allege were smuggling money abroad or selling fake passports in schemes that could aid terrorists.

Among the operations that authorities said they cracked was one in New York that allegedly moved $33 million, some from illegal drug sales, to Pakistan. Another was a network of tobacco stores in Minnesota that allegedly smuggled cash to Lebanon and Jordan.

Authorities said while none of those who were arrested over the three-day operation are being charged with being terrorists, the schemes they used and the countries they were involved with have been "exploited by terrorist organizations."

"By dismantling these illegal networks, we are denying avenues for terrorist groups to raise and move funds in this country," said Michael Garcia, a top official with the new Bureau of Immigration and Customs Enforcement, which oversaw the investigation.

The arrests were led by the Operation Green Quest task force, made up of federal agencies including the FBI, IRS, Secret Service, Naval Intelligence Service, Coast Guard and Postal Inspection Service.

To date, the task force has arrested 93 individuals and seized $11 million involved in terrorist financing operations. It has seized $24 million more in smuggled cash, most headed to countries with terrorist problems, officials said.

In a Friday morning raid in Los Angeles, agents executed search warrants at a home and business and arrested one man after agents intercepted more than 270 money orders totaling nearly $136,000 that were being shipped to Beirut via private parcels.

In New York City, agents arrested four people in raids Thursday night that resulted from an 18-month undercover operation that authorities said showed a business named Manhattan Foreign Exchange moved $33 million to Pakistan. Authorities said some of the money was from illegal proceeds, including drug sales.

Associates of the business also sold fake U.S., Pakistani, Canadian and British passports and other fraudulent travel documents, officials alleged.

Manhattan Foreign Exchange's owner, Shaheen Khalid Butt, was arrested on charges of laundering drug proceeds, currency reporting violations, conspiracy violations and immigration fraud, officials said.

Also Thursday, agents arrested four people and executed search warrants at five tobacco stores and one home in Minnesota. Authorities said they had evidence the business had engaged in tobacco stamp fraud and smuggled hundreds of thousands of dollars to Lebanon and Jordan.

In one instance, agents discovered nearly $157,000 in cashier's checks were sewn into the lining of a handbag that was to be brought aboard a flight destined for Lebanon, officials said.

In New Jersey, agents seized more than $48,000 on Wednesday from two bank accounts from which numerous checks were being sent in packages to Yemen, site of the 2000 terrorist attack on the American naval ship USS Cole, authorities said.

And a federal grand jury in Detroit issued a superseding indictment charging Omar Chicano of conspiring to distribute and manufacture counterfeit securities. He was arrested last July at Detroit Metropolitan Airport upon arrival from Indonesia, when agents discovered he had $12 million in counterfeit cashier's checks.