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Post-Hearing Questions for the Record
Submitted to Mallory Factor
From Senator Daniel Akaka

“An Assessment of Current Efforts to Combat Terrorism Financing”

June 15, 2004

1. Appendix C of the Council's report states that “Saudi compliance with counter-terrorist financing measures is relatively strong.”

But, Appendix B – the Technical Assessment of Saudi Arabian law — indicates that the
Saudi government has failed to implement their new terrorism financing laws. This
Appendix presents a devastating pattem of failure by the Saudis to confront terrorism
financing.

On a scale of A to F, what overall grade would you give the Saudis?

Answer: If Saudi Arabia is compared to other nations in the Islamic world, as Appendix C to the Task Force Report does, I believe that the Saudis have been relatively successful in putting into place a legal and regulatory framework designed to combat terror financing. Thus, on this comparative basis, the Saudis have earned a passing mark in this regard. In contrast, however, if the effectiveness of the Saudi new regime against terror financing is evaluated based on evidence we were able to obtain, I believe that the Saudis do not yet earn a passing grade in actually curbing terror financing. Such an evaluation is made in the core Task Force Report and Appendix B, and I believe that my assessment of Saudi Arabia on this subject is consistent with the Task Force as a whole.

Post-Hearing Questions for the Record
Submitted to the Honorable David D. Aufhauser
From Senator Daniel Akaka

“An Assessment of Current Efforts to Combat Terrorism Financing”

June 15, 2004

1. Saudi Arabia has yet to comply with the United States’ request that the former head of Al Haramain, be arrested for his involvement in terrorist activities. Al-Aqil is on the United States’ terrorist watch list and is believed to have sufficient resources and connections to continue supporting terrorist organizations.

How much credibility can we put on Saudi Arabia's recent efforts when it continues to overlook his crimes?

Should we take this as a sign of the government's lack of commitment to cracking down on those who finance terrorist activities?

Response:

As I have said before, much of the Saudi initiatives against terrorist financing have focused upon changing their system on regulation and oversight. Very little has resulted in holding people personally accountable. Failure to proceed against Al-Aqil is, perhaps, the most striking example of the continuing failure to address the issue of personal accountability. They will not succeed in fighting terrorism unless they hold the bankers of terrorism accountable.

2. Appendix C of the Council's report states that “Saudi compliance with counter-terrorist financing measures is relatively strong.”

But, Appendix B – the Technical Assessment of Saudi Arabian law — indicates that the
Saudi government has failed to implement their new terrorism financing laws. This
Appendix presents a devastating pattern of failure by the Saudis to confront terrorism
financing.

On a scale of A to F, what overall grade would you give the Saudis? Response: This question is really best addressed to the Council on Foreign Relations. My

net assessment is that much of what has been done is form over substance and doesn't make any of us any safer

An Update on the Global
Campaign Against Terrorist Financing

Second Report of an Independent Task Force on Terrorist Financing
Sponsored by the
Council on Foreign Relations

Maurice R. Greenberg,
Chair

Mallory Factor,
Vice Chair

William F. Wechsler and Lee S. Wolosky,
Project Co-Directors

June 15, 2004

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Opening Statement of
David D. Aufhauser, former General Counsel,
U.S. Department of the Treasury,
Senior Fellow, Center for Strategic & International Studies
Before the Senate Governmental Affairs Committee
June 15, 2004

In early 1996, Usama Bin Laden was living in exile in the Sudan. He was at war with a House of Saud policy that countenanced the presence of U.S. troops on Saudi soil. And he was already plotting mayhem sufficient enough to warrant the establishment of a special “Issue Station" at the CIA devoted exclusively to divining his ambitions and designs. Still, he was regarded as the son of a rich man and

principally a financier of terror. In fact, the original name for the special purpose

unit at the agency was "TFL" -- terrorist financial links.

It turned out that Bin Laden was actually a hapless businessman. His ventures failed and were not the principal source of Al Qaeda's wealth. Rather, he tapped something far deeper and more dangerous — hate preached and taught in places of despair, married to rivers of unaccounted for funds that flowed across borders in the counterfeit name of charity and faith. And in so doing, Bin Laden managed to leverage the tactic of terror into a malevolent dogma embraced by an

army of madmen.

How we got here is instructive to where we must go.

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