Tax Dollars for Terrorists
Tuesday, November 23, 2004
By: Angela French

Wastewatcher, November 2004

As part of the War on Terror, investigations of terrorist networks have uncovered some startling
facts.  U.S.-sponsored international relief programs have been allowed to squander billions of taxpayer dollars on questionable programs.  Recent reports have revealed that during the last term of the Clinton administration, U.S. taxpayers inadvertently helped fund some of the world’s largest terrorist organizations, including Al Qaeda. 

In October 2004, a Federal Bureau of Investigation (FBI) team procured documents of the Islamic American Relief Agency (IARA), a group suspected of having ties to terrorists.  The FBI team found evidence that at the same time the group was receiving millions of dollars from the U.S. Agency for International Development (USAID), its overseas partners were channeling a large chunk of funds directly to Osama bin Laden.

IARA describes itself as an independent, Islamic group which performs various charitable functions worldwide.  Its website states that IARA has ties with no other organization.  However, the Treasury Department stated that IARA’s U.S. headquarters in Missouri was one of 40 global offices, and that the group is part of an international network originating from Khartoum, Sudan.  From 1997-1998, IARA was granted at least $4.4 million to provide child survival assistance and help with disaster relief.  Meanwhile, IARA provided financial backing to a number of bin Laden-controlled institutes and charities.  For instance, IARA had a “joint-program” with a bin Laden-approved institute that provided support for the Taliban soldiers in Afghanistan.  The organization also financed a “charity” called Maktab Al-Khidamat, which helped a group of Arab terrorists that planned to attack American military employees in Saudi Arabia in 1997.

Though IARA had been a concern of the FBI since 1996, USAID funds were only cut in December 1999 when Richard Clarke, President Clinton’s chief of counterterrorism, said he had reason to believe the group had possible connections to terrorist organizations.  The government shouldn’t have waited until 1999 to stop funding the organization.  The fact that the FBI had IARA on its radar screen should have convinced the government to freeze funding, but because international relief programs lack oversight and accountability, U.S. taxpayers indirectly helped fund one of the greatest security threats to America.

Tax-funded terrorism is the most shocking example of a foreign aid system run amock.  A new report on what may be the largest foreign aid scandal in history, the United Nations’ (UN) Oil-For-Food program, indicates that Saddam Hussein infiltrated the $60 billion program and funneled up to $17.4 billion into his own coffers over a period of six years.  The swindle was facilitated by a web of corruption and negligence within the UN bureaucracy.  The U.S. paid the international organization more than $897 million in dues in 2003. 

Despite the widespread evidence of the corruption and failure in foreign-aid programs, the International Monetary Fund (IMF) is trying to convince the U.S. to increase its foreign aid support.  The IMF plan calls for a multi-billion dollar aid expansion.  Those receiving benefits include: “Axis of Evil” member Iran, which could get $465 million; Syria may receive $90 million; Zimbabwe would be eligible for $115 million; Sudan could receive $100 million; and the “gentle junta running Burma” could get $80 million.  

It is no surprise that the proposal was launched in 1997 by the Clinton administration.  Because the U.S. is a creditor of the fund, taxpayers would be asked to fork over the majority of the cash.  If it is approved, the plan’s cost to U.S. taxpayers could reach $750 million per year.  The IMF is notorious for dishing out funds without any expectations, and according to formal IMF policy, it does not expect to be paid back.  IMF loans often do more harm than good to recipient countries by adding to their debt, increasing instability, and proppping up corrupt institutions.   

The U.S. holds enough voting power to block the IMF proposal.  Lack of liability in foreign aid programs has apparently led to taxpayers helping Osama bin Laden and Saddam Hussein.  Investigations into foreign aid relief continue, but as long as the government supports programs without demanding better results and more careful oversight, U.S. taxpayers will continue to see see their money backing dictators and terrorist groups.