Zakat-Charities and the financing of Terrorism
One of the features of Shariah-Compliant Finance is that financial institutions who participate in it may well be helping to finance terrorism through monies contributed to Islamic charities. As the article below reveals, some of these so-called “legitimate” charities have been funding and continue to fund terrorism.
by Phil Leggiere
Thursday, 06 November 2008
New paper examines how Al Qaeda uses moderate Muslims to ‘microfinance” terror.
Terrorist networks and organizations have many “underground” means of financing themselves, from drug smuggling to cybercrime. As challenging as these clandestine methods are to globally eradicate, an equally vexing problem is how to shut-off jihadist funding siphoned off from so-called “legitimate” charities.
Addressing that problem, according to Tolga Koker Department of Economics and Carlos Yordan Department of Political Science Drew University, means addressing the question of why tens of thousands of Muslims who are not terrorists and often opposed themselves to terrorism nonetheless support the work of charities that support jihadist operations. Their new paper, titled Microfinancing Terrorism: A Study in Al Qaeda Financing Strategy, published Tuesday by the Social Science Research Network, tries to do just that.
Although new banking and financial regulations may have made it difficult for terrorist groups to move funds around the world, the authors argue, these groups have be quite resourceful in finding ways to adapt to the new regulatory environment and to undermine it.
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