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Peter Carbonara: Following the al Qaeda money trail

Osama bin Laden
Osama bin Laden  

Peter Carbonara is a senior writer at Money Magazine. He is the author of an article in the November issue that investigates the financial network funding terrorist activities of Osama bin Laden's al Qaeda network. He joined the chat room from Los Angeles.

CNN: Welcome to, Peter Carbonara. Thank you for joining us today.

PETER CARBONARA: Hello, thanks to anyone who's out there.

CNN: You've recently researched the funding of bin Laden's al Qaeda terrorist network. What did were some of your findings?

CARBONARA: Well, what we found is that this is a very decentralized network more than a single organization, and it gets its money from a variety of different places. Much of it comes via charities throughout the world, Islamic charities throughout the Muslim world, rich people in the Middle East who are sympathetic to its aims. It also generates revenue from some legitimate businesses, and from bin Laden's personal wealth.

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CNN: How expansive is the bin Laden fortune exactly?

CARBONARA: Tough to say personally. Estimates for how much he is personally worth have gone as high as 300 million dollars, and as low as 30 million dollars. The value of his family's legitimate businesses is in the billions.

CHAT PARTICIPANT: Peter: Are there any Afghan people funding al Qaeda or bin Laden?

CARBONARA: To my knowledge, no. The money comes primarily from wealthy countries in the Middle East, in the Persian Gulf.

CNN: Where did you begin in your research and how difficult was it to track the money trail?

CARBONARA: It's very difficult. The best resource for me was the testimony of an Al Qaeda defector who testified against the four men convicted of the embassy bombings [in Nairobi, Kenya,] in 1998. But tracking the flow of money goes all around the world, goes through countries that have very tight bank secrecy laws, and a lot of it goes through informal networks, which leave no paper trails.

CHAT PARTICIPANT: How long do you think this has been going on?

CARBONARA: As long as there has been terrorism, there have been people willing to pay for it. The short answer is, a long time. Specifically, as regards al Qaeda, it's been going on for about 10 years.

CHAT PARTICIPANT: Peter, I thought bin Laden's family disowned him and he has no business income?

CARBONARA: It's true, his family has disowned him, but before they did, he had a substantial inheritance, and there are unanswered questions about whether some members of his family have been discreetly supporting al Qaeda.

CHAT PARTICIPANT: Is there any actual government money being used? I mean money from a nation rather than a company or people... Libya? Syria?

CARBONARA: Not to my knowledge, at least not directly.

CHAT PARTICIPANT: What happens to money that is taken away from terrorists? Can we use it to fund the war effort or compensate those families who lost loved ones in the World Trade Center terrorist act?

CARBONARA: It depends where it is. If it's in a bank account in the United States, the government might be able to seize it, if they can prove it really is terrorist money. If it's money in a foreign bank account, it could be very tough to get government hands on it.

CHAT PARTICIPANT: Are we able to identify these business and charity organizations located in the United States?

CARBONARA: Yes, but it can be difficult, because many of these charity organizations are at least partly legitimate charities, so there are groups that do humanitarian work, but also divert some of their funds to groups like al Qaeda.

CHAT PARTICIPANT: What has the Saudi government done to curb bin Laden's fortune?

CARBONARA: The first thing the Saudi government did is expel him from the country, and take away his Saudi citizenship, which made it difficult for him to get his own funds that may have been in Saudi Arabia. More recently, the Saudis say they are cooperating with our government to identify people in businesses in Saudi Arabia who have helped Al Qaeda. But our government hasn't always been happy with the amount of cooperation they've received from Saudi Arabia in that area.

CNN: Why do you say in your article that terrorism is cheap?

CARBONARA: It doesn't require much money to create a lot of suffering. The immediate cash outlay for September 11 was just few hundred thousand dollars, and the material damage in New York alone is in the billions, and of course that doesn't include suffering and death.

CHAT PARTICIPANT: How are we finding these accounts?

CARBONARA: I guess it depends which accounts you mean. There are accounts abroad that have been identified by foreign regulators, and some accounts in this country identified by the FBI and by police work here.

CHAT PARTICIPANT: Do any other members of his organization have access to personal wealth?

CARBONARA: Money comes into al Qaeda from lots of different sources, and bin Laden is probably not personally involved that much on an individual basis with all these sources. It comes from a lot of places.

CHAT PARTICIPANT: What percentage of the money do you think we will be able to close down?

CARBONARA: I think that's very hard to say. It's been difficult in the past to completely freeze the assets of the Mafia and organized crime, and I think it would be even more difficult with a group as diffuse and international as this one.

CHAT PARTICIPANT: Peter, what is the system of banking whereby a deposit in one country may be drawn in another?

CARBONARA: It's called correspondent banking, and it's a very hot and controversial subject right now for bankers and regulators.

CNN: Do you have any closing comments for us today?

CARBONARA: Thank you all for your questions, and I'll refer you to my article, which is in the current Money Magazine.

CNN: Thank you for joining us today, Peter Carbonara.

CARBONARA: Thank you.

Peter Carbonara joined the chat room by telephone and CNN provided a typist. This is an edited transcript of the chat which took place on Thursday , November 8, 2001.


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