Wednesday, July 19, 2006
Terrorism groups helped by black market goods
Do you ever wonder who profits from the black market sale of cigarettes or Viagra? Well, those purchases could help finance Hezbollah, the terrorist organization engaged in a conflict with Israel.

"Anytime that you buy a good illegally on the black market, there is a possibility you are helping to fund groups like Hamas and Hezbollah," said terrorism financing expert Emily Hunt.

Hunt says tens of millions of dollars -- a conservative estimate -- is funneled to Hezbollah from the United States through various illegal operations.

In March, the U.S. Department of Justice charged 19 men with "racketeering to support a terrorist organization." For eight years, investigators say, the suspects sold contraband cigarettes, counterfeit rolling papers, even counterfeit Viagra.

Investigators say the suspects bought cigarettes in North Carolina, where taxes are lower, or in some cases at a New York Indian reservations, where there are no taxes. By doing so, they evaded tens of millions of dollars in cigarette taxes.

They then made huge profits by reselling the cigarettes in New York and Michigan at market prices. A portion of the profits, the indictment charges, was given to Hezbollah. Can you imagine? U.S. citizens unknowingly sending money to Hezbollah.

But some other Americans were well aware of what was going on. In some cases, buyers on the black market were charged a "resistance tax" -- a set amount over the going price -- and told the money would go to Hezbollah, investigators said.

Members of the group also allegedly solicited cash from customers to be given to orphans of Hezbollah suicide bombers. And the money trail doesn't stop there. Investigators say Hezbollah also received financing through sympathetic charities. After the donations were made, they were diverted to Hezbollah.

"Many of them are able to kind of fly under the radar simply because we don't have the resources. ... Law enforcement doesn't have the training or the time to really be delving into their backgrounds," Hunt said.
Posted By Randi Kaye, CNN Correspondent: 2:33 PM ET
  44 Comments
The US govt. gives our tax money to corrupt governments that hold their own citizens captive through terror. That's no different than someone selling contraband and funding a 'terrorist' organization. Funds gained illegally(taxes) used to kill civilians.

We fund Israel to the tune of $2.5 Billion every year(and that's money that's listed on the books). I consider Israel a rogue state. They just happen to be on the US list of 'good' rogues.
Posted By Anonymous Jason Jons, Des Moines Iowa : 2:45 PM ET
Good investigative report. All the more reason to support Israel in their struggle to eradicate Arab terrorism.
Posted By Anonymous xtina - chicago IL : 2:46 PM ET
Let's face it -- philosophical issues with governments notwithstanding, any purchase off the black market in the US funds criminal enterprise, either local or international. I think the real surprise factor here for people is the seemingly innocent face used by terrorist fronts.
Posted By Anonymous David - Tulsa, OK : 2:58 PM ET
This is what we get when liberal newspapers unveil money tracking programs. This is exactly the kind of thing that they would be stopping. Thanks a lot, liberal media.
Posted By Anonymous Ceclia, Houston Tx : 2:58 PM ET
If you are buying black market goods, how can you pretend to be naive about where the profits are going? Chances are, they aren't going to your Sunday Church group.
Posted By Anonymous T. Madsen Seattle,WA : 2:58 PM ET
That is a long shot. Also, Hizbollah does do charity work for people that the US government treats worse than dogs. 2 soldiers kidnapped and israel can exterminate 300 innocent civilians and be justified. I think terrorism needs to be redefined as an act of aggression not against humanity but only against US allies or political and economical interests. It is saddening that of all people, the holocaust survivors are now the perpetrators of another holocaust. Our taxes pay for all the weapons that Israel is using to kill innocent civilians (not to mention the 50000 civilian casualoties in Iraq). May be we should stop paying taxes.
Posted By Anonymous Neomi Pottle, New Haven CT : 3:07 PM ET
Well we give close to $3 billion a year to Israel. I'd say letting Hezbollah skim a few million in counterfit rolling paper profits is the least we can do. The State Department might consider Hezbollah to be a terrorist organization - but thats only because they are fighting someone we support. If they were fighting against Castro or Kim Jong Il the State Depratment would be calling them 'freedom fighters' instead. I say let's give Hezbollah some nukes and stealth bombers. Israel can already take care of it's self - it has hundreds of nukes and one of the most advanced militaries in the world. If both sides had the capacity to totally destroy one another, ie MAD - maybe the fighting would stop. Otherwise it just seems as though there will be neverending hardship on the civilians of both sides.
Posted By Anonymous stan, tampa, fl : 3:11 PM ET
Not a feasable report. Hezbollah is funded by Syria, Iran, and several interest groups inside Lebanon. Suggesting that Americans are funding terrorism unknowingly by purchasing items on the blackmarket is a shot in the dark when evaluating terrorists economic infrastructure. Kaye failed to show an educated comparison on how much of the black market profit go to terrorist funding. This story needs further development with more reliable sources.
Posted By Anonymous Lisa, Houston, TX : 3:15 PM ET
That's crazy. Millions of Americans buy goods on the Black Market so as to not have to pay the high prices of store or legally bought goods. If their cash is funding terrorist groups than not only do they have to pay more, but so don't innocent people. Only these people now have to pay the price of their lives in the case that their country is terrorized.
Posted By Anonymous Ann, Millbury, Ma. : 3:16 PM ET
Why do we have black markets in the US in the first place? If we'd drop all these stupid protectionist policies and regulation of substances and the outrageous "vice" taxes, then there would be no black market to exploit.

Anyway, follow the money. These groups are fundraising here, and they're going to do it legally and illegally.
Posted By Anonymous Ken, Long Branch NJ : 3:17 PM ET
So what? We openly fund Israel, the world leader in state-sponsored terrorism, over $2.5 billion a year. And the Mossad is acknowledged as the world's leading exporter of the drug Ectasy. Everytime some kid buys a hit of that, he is helping fund more of their terrorist acts. Hezbollah and Hamas can't compete with that (legal and illegal) funding.
Posted By Anonymous Roarke Johnson, Albuquerque, NM : 3:19 PM ET
What you guys should be asking is what gives Israel the right to bomb Lebanon into the stone age (including civilian targets) over a couple of captured soldiers? They should be negotiating with Hezbollah, not bombing an innocent country. Israel is run by an evil government, they are worse terrorists than the so-called "real terrorists".
Posted By Anonymous Mike, Toronto, ON : 3:23 PM ET
Please... Hezbollah and Hamas are "State" funded terrorist groups. Any financial black market sources of funds for these terrorist gaggles pale in comparison to what the Saudi's, Iranians, Syrians and other middle-eastern countries, probably the French and Russians as well, provide them. I don't suppose we can go after all of the "national" sources at once, but we shouldn't divert our attention to non-impactful methods of raising funds either.
Posted By Anonymous Steve Piccinati, Foothill Ranch, California : 3:23 PM ET
Everything today has the prefix of terror.
For example:

1. Jaywalking which is now referred to as terrorizing the roadway
2. Disturbing the peace now referred to as terrorizing the neighborhood
3. evading tax on commercial products like cigarettes now referred to as terrorism financing etc.
4. Next time you go out to dinner for dessert order the tiramisu (dare not call it Terror Moo Su)
Posted By Anonymous Louis, NYC New York : 3:25 PM ET
We also fund Israel when we buy generic pharmaceutecals. They are the worlds largest generic drug manufacturer through Teva Pharmaceuticals Inc.
Posted By Anonymous Jeff , Sacramento,Ca. : 3:29 PM ET
I am concerned by the media's heavy focus on Hezbollah while overlooking or minimizing the costs that have been incurred by Israel against Lebanese civilians. It is not clear that Israel has inflicted any significant damage on Hezbollah, but we do know that hundreds of innocents have been killed, nearly a thousand wounded and up to half a million people displaced from their homes in Lebanon. While Hezbollah is definately a problem, i think it is wrong to minimize the effects and consequences of Israel's deadly hyperreactive behavior.
Posted By Anonymous Anonymous, Eugene, OR : 3:31 PM ET
I am sure that it is possible that a certain proportion of profits does end up in terrorist organizations; but it seems that most of the funding originates in Iran/Syria/etc.

The scary thing is that we are fighting a war in Iraq, for which we must load money, part of which comes from the middle east. Then we must pay interest on all of our loans, which finances the middle east, including terrorist organizations.

So it is possible that we are funding terrorist -- but not just by buying illegal goods. Instead, we are providing the funding by financing governments, and those governments, in turn, finance terror.

Then with more terror, we are forced to fight more war, and loan more money , etc. and it goes in a feedback loop.
Posted By Anonymous Samantha, Nashua, NH : 3:37 PM ET
Thanks for this report. I asked my brother in Lebanon how to send Hezbollah the cost of a rocket to be fired to my Village in Northern Palestine on the Lebanese border the other day but he could not help. Thanks for this report, from now on I will buy all my goods from the black market to support the freedom fighters in Lebanon and Palestine. Remember There are 10000 palestinian prisoners in the so-called Israel. Israel and USA are the major sources of terrorism in the world. If you realy beleive attacking an illegally occupying force is terrorism and killing the children of Lebanon and Plaestine is self-defence you must be joking!
Posted By Anonymous Ali from Manchester, UK : 3:39 PM ET
None of the hippocrate Western media seem to cover that Lebanon is a fake democracy created last year by Bush regime and is virtually powerless. Yes, Hizbollas have done a good job of creating hospitals, schools, and a lot of other things more than Bush's puppet Sinoira Administration in Lebanon.
Now all Bush regime wants to do is "preserve the fledgling democracy" in Lebanon. That's the boy-king Bush's call. He doesn't care if he again has to spend billions of US tax-payers hard earned dollars to repair Lebanon. All he seems to care is his messianic doctrine about bringing "democracy in Mideast" . i say first curb your "democratic" bulldog Israel first.
Posted By Anonymous baba, New Port, NJ : 3:51 PM ET
I find it fasinating that some people equivicate Isreal and Hezboollah and Hamas. Hezboollah and Hamas have publicly stated that they won't give up until Isreal ceases to exist. Gee that gives you a lot of room to negotiate.

Hezboollah and Hamas hide in civilian areas so any attempt to prevent them from striking Isreal could hurt civilians. (since they hide behind civilians) Do I want Muslims killed? NO! The problem is Iran and Syria's asperations to have a Lenoist style religios state.

Folks it is rather difficult to negotiate with Hezboollah and Hamas, they don't have a counsualte etc.
Posted By Anonymous Jim,Portland,OR. : 3:54 PM ET
I would urge Neomi Pottle of New HAven to please educate herself with the definition of Holocaust. For everyones sake.
Posted By Anonymous Douglas Jones,Charlotte,NC : 4:03 PM ET
I have a gut feeling everytime I buy gasoline that some portion of each $3.00+ I pay per gallon makes its way to terrorist groups that I have no desire to support. If that is true, the significance of the illegal cigarette and viagra sales, while important to stop, must pale in comparison to the amount of money flowing to these groups via legal gasoline sales. What should our government be doing to help us buy less gasoline? Why aren't they urgently doing it?
Posted By Anonymous Jim Lemon, Vienna, VA : 4:05 PM ET
I have to side with Texas Lisa on this one. Who do we think we are kidding. The black market might, but the open market does, fuel the M-E wars.
Every time the pump goes ka-ching as you're filling your SUV, you are pulling the trigger on a Hezbolah rocket launcher. When are Americans gonna get it? It's the foreign policy, Stupid!
Posted By Anonymous James, Manakin, VA : 4:08 PM ET
Let's face it, the way most Americans help fund terrorists is by driving gas hogs. It's no secret that it's the oil rich, middle east countries that are the ones funding the terrorists. Every time you fill your SUV you giving terrorists money to kill you.
Posted By Anonymous Jerry, Cleveland, Ohio : 4:08 PM ET
Thank you. Now I will buy more black market items, if I know I could support Hezbollah and Hamas. They are the only forces willing to break the state of Israel, a known fascist state.
Posted By Anonymous George Cowper, Uxbridge, Ontario : 4:09 PM ET
Fantastic, CNN : perhaps this investigative reporting zeal could bring us another side of the story - why are we funding Israel to the tune of 3 billion dollars a year (not to mention the loans which are never paid back) when there is no significant Israeli or Jewish minority in this country, no obvious benefit as far as our standing in the world is concerned and no need since Israel has a working economy, incredibly smart and hardworking people and a good infrastructure ?

We're funding terror when buying things on the black market ? Are you serious ?
Our taxes fund an illegal war in Iraq - not even sure why our troops are still over there - but we should be concerned when buying counterfeit Viagra ?

Get your priorities straight, CNN.
Posted By Anonymous Charles Killier, Tacoma, WA : 4:10 PM ET
I think it's our tax dollars that are funding the terrorists. We give 2.5 billion dollars, to Israel to terrorize the civilian population of its neighboring state. It's not even funny that we spend so much money on funding the Israeli war machine, and yet we charge our compatriots a $300 fee to evacuate them from the mess that same country has created.
Posted By Anonymous Robert, Carmel, IN : 4:11 PM ET
This is what we DON'T get when CONSERVATIVE newspapers/ pundits unveil money tracking programs. This is exactly the kind of thing that they WON'T be stopping. Thanks a lot, CONSERVATIVE media.

See how easy regurgitation is, "Posted By Ceclia, Houston Tx : 2:58 PM ET"??

Let's continue fresh thoughts... This isn't our war to stop.
Posted By Anonymous Joe, Charleston, SC : 4:12 PM ET
Buy stuff on the black market or pay your taxes. I dont see much of a difference. Either way its going to fund the aggressor/terrorist, whether it be governments (US and Israel)or "insurgents" or Hezbollah. And the liberal media comments? Please. Anyone watch CNN or Fox News lately? If you think thats liberalism, you need to go back to school.
Posted By Anonymous James, Philadelphia, PA : 4:13 PM ET
What I would like to know is what are we buying that is funding the Israeli "war machine", whose motto is eyes for an eye, teeth for a tooth. Why are you writing articles about how we finance Hezbollah, when the hypocritical US govt sends 2.5 billion to a country with one of the highest per capita incomes? WE TAXPAYERS ARE FUNDING TERRORISTS EVEN IF WE DON'T BUY CONTRABAND....THE ISRAELIS!
Posted By Anonymous Dave, Arlington, VA : 4:15 PM ET
Terrorists funded on the black market? Thats one of the shoddiest pieces I've seen on CNN. I'm going to need more credible, reliable sources and hard, tangible evidence before I hitch my wagon to that one. Criminal? Yes. Terror funding? I dont know.
What I do know is that Israel receives BILLIONS of free money from American tax payers, free millitary equipment to use tanks and kill kids throwing stones and bombs to murder innocent civilians. This has nothing to do with two soldiers, this is about Israel wanting to keep Lebanon destroyed in order to keep itself the most powerful nation in the region. AFter all if you break every bone in a persons body, they can't out perform you at work, they cant make more money than you and they cant make YOU (Israel) look like the barbarians that YOU are. Israel wants to keep the Lebanese crippled and at war, just like what they've done to the Palestinians, so Israel can steal the tourism dollars,foreign investment and financial and technical industry growth that marks the thriving Lebanese economy. At least it did.
Why would the American government (particularily the Republicans) support such a terrorist nation as Israel?
The Zionisht movement, that's why, which is made up of jews and extreme right wing "christians". These Baptists and/or Born Again "christians" is a special brand of christianity specific to the US and they have a fixation with the book of Revelations which states that in order for the Second Coming of Christ to happen, all the jews of the world must be in Israel. Then all the jews must convert to christianity or face annhilation, which will lead to Armegeddon and the End of the World and then the Second Coming of Christ. Why would jews align themselves with these "christians"? Well, because Jews dont believe in Christ and therefore dont believe in the Second Coming or Armegeddon and find the whole thing laughable....they're laughing all the way to the bank because the right wing christian groups fund and elect politicians who continue to give Israel a blank cheque to do what it wants. And you as the American nation are being held hostage by these Zionists, as is the rest of the globe. When will you people wake up and demand the TRUTH from your' government?
I wonder if CNN will have the courage to broadcast this entry.
Posted By Anonymous RT, Calgary, Canada : 4:17 PM ET
What is worse? Knowinlgy paying for black market goods or paying taxes enfored by our government that supports the 4th largest military in the world - Israel - and it's killing of innocent lives with far less capabilities.
Posted By Anonymous Maria, Reno, NV : 4:17 PM ET
This report is ridiculous. Sure, there may be some truth to it, but I am disgusted at how most American citizens and our government overwhelmingly support Israel and their irresponsible acts of war. Israel is a terrorist state, and has been for some time now. They hold thousands of innocent civilians as prisoners, but when a few Israeli soldiers are kidnapped, everyone jumps on the "Go Israel!" bandwagon. Our policy in the middle east needs to be more balanced. Israel shows little or no discretion in avoiding civilian casualties. We are just as guilty as Israel with our funding and support for their barbaric acts.
Posted By Anonymous Will, Glasgow, KY : 4:18 PM ET
First I would like to say have some scence of descensy and respect and quit referring to what pretty much 60% of lebanon, not to mension many from other countries in the world(including me) belive to be "Heroes" as "terorists". Because the true terosrists are isreal who will kill inncoent civilians, and bomb up a citizen's resedence and reffer to it as "a military base for hizbollah". And listen to what you are saying people are paying money to support orphans who's parents would not bow thier head in shame but instead decided to stand up for their own country. How can you find that to be a wrong thing. America supllies isreal with 2.4 billion dollars worth of goods every year. And by goods i mean guns and amunition in wich are used to kill innconcent people. And listen to what you are saying Where do you think the money that goes to isreal comes out of? Your taxes! The only reason someone would report a story like this is probably because they are cowards and are aafraid that with a few more dollars hezbollah will give america and isreal what they deserve!
Posted By Anonymous sarah windsor, ont. : 4:26 PM ET
You either choose to be oblivious, or choose to be involved. Merely having an opinion is arrogant and hypocritical.
Posted By Anonymous Frank Lee, Boston MA : 4:38 PM ET
Law enforcement needs the resources to go after the black market. Otherwise, more terror organizations are going to pop up around the world and the war on terror will never end.
Posted By Anonymous Jared, North Conway, NH : 4:42 PM ET
I can't believe all you people claiming that Israel is a terrorist state. Israel has been putting up with Palestinian suicide bombings for years, without retaliating. The kidnapping of soldiers is not being used as an excuse, it was the straw that broke the camel's back. Israel has every right to go after Palestine and Hezbollah.

And for all of you terror-loving liberals who think that the US is funding terrorism via Israel: just remember that the US has continually pressed for peace agreements, as well as encouraged Israel to pursue diplomacy.

Finally, quit berating Mr. Cooper for bringing this black-market connection to our attention. You whiners make me wonder if you think it's your birthright to participate in illegal, terrorism-funding activities. It's not!
Posted By Anonymous Jonathan, Albuquerque, NM : 4:42 PM ET
Every single American in this country subsidizes Islamic terrorists every time we purchase a gallon of gas rooted in mid-east oil. Subsidies from black market goods and drugs are miniscule in comparison to the funds laundered to terrorists through middle eastern powers (to include supposed 'allies' like Saudi Arabia) from oil sales.

Is it not just like a junkie to be unable to disengage from activities known to be detrimental due to the discomfort it would impose.
Posted By Anonymous Ken L., Austin, TX : 4:45 PM ET
My fiance is reading an English translation of the Koran within this translation it is stated that the root of the hatred between these two groups goes back to Mohammad. When he received the Koran from Allah he brought it to his people and they accepted it. He then brought it to the Jews and they said No Thank You. That was roughly 1400 years ago. Going back further to Abraham and Sarah, there is further roots for resentment. Abraham had two sons. His first came from the handmaiden, Hagar, because Sarah was barren, then God created a miracle and Sarah gave him a son. Her son became the branch of the Hebrew people. The handmaiden and her son were cast out into the desert. The Arabs are said to be from that line. Add displacement of Palestinians after WWII in order to create Israel and you have a more explosive version of what's going on with the Native Americans in the US.
These conflicts go back thousands of years. It is not surprising this has broken out again. Certain Arab countries want Israel to no longer exist, for the Diaspora to begin again. These groups won't rest until they have it. This includes invading Israel with guerrilla tactics, killing and kidnapping people then acting all innocent when Israel responds with artillery.
Posted By Anonymous Ailim, Olean, NY : 4:45 PM ET
Hezbollah is called a terrorist organization because they kill civilians. Maybe they kill civilians because US provided arms to Israel military so the Israel military is unreachable and also Hezbollah's weapons are so low quality that they can't hit their intended target.
So why not, give them Hezbollah the same weapons, so at least they can hitting at the right targets which is the Israel army.
That's called sarcasm everyone.
Posted By Anonymous Roy, Vancouver, BC : 4:52 PM ET
If you think Israel is such a evil state, why don't you move to the Middle East and join Hezbollah or Hamas? You are preaching their doctrine anyway. Some people posting on this blog are conveniently forgetting that innocent Israelis are dying to.

I heard Dennis Ross speak once and he was confronted by an anti-Israeli student (I say "anti-Israeli" because I believe you can be "pro-Palestinian"
and "pro-Israeli"). His comment to her was: "The fundamental difference between you and I is that I cry when people on both sides die."

This conflict didn't start a week ago. I would be impressed if even one person who condemns Israel would actually offer up an alternative to their actions that is reasonable (because we all know that trying to negotiate with a terrorist organization sworn to your destruction probably won't work).
Posted By Anonymous Sam, Washington, DC : 4:56 PM ET
Come on ... can we stretch this any further? Quit sending 3 BILLION dollars to Isreal and they can fight the "black market". We're still recovering from Katrina and Rita down here. Get with Habitat and build a few neighborhoods with that money. Instead our government wants to throw money to terrorists blowing up civilian neighborhoods and forcing the American way of life on others.
Posted By Anonymous Karon M., Pollock, LA : 5:15 PM ET
I laughed at the incredulous "Can you imagine?" in the article.

Yes, I can easily imagine that many Americans sympathize with or even support Hezbollah and others opposing Israel's brutal domination of the region.
Posted By Anonymous Grant, Toronto, ON : 5:30 PM ET
Wow, all the Anti-Israeli folks showed up all at once. First of all, to the orginal topic of the blog. Black market goods fund all sorts of groups that the US has listed as terrororists. Al Qaeda, Hamas, Hizbolla etc... This is nothing new, but never the less a great flash point topic to generate discussion. Which it most certainly has. Lots of Mosques also are fronts for funding these very groups, as well as recruiters. Israel has alienated a lot of folks with their violent responses to provocation. I am not sure they have the choice to respond any other way. With many Arab countries dedicated to their destruction, it is hard to play armchair general and say exactly what should be done. Muslim fanatacism starts from the top down. I am suprised that so many people think you can just (sit down and talk about it). That is a dream. An old saying (never argue with an Idiot; Never negotiate with a Madman) Unfortunately extremist regimes see everyone that is non muslim as Infidels. That means your life is worth nothing to them. This includes all the folks from Canada piping in on how America and Israel should get what they deserve.. It is delusional to think that negotiations with Iran or Syria are worth the paper it takes to write it down, not as long as the Extreme Islamist faction is in power. I for one cannot judge Israel for what they do in response to the folks who are out to DESTROY them. Not negotiate or talk but exterminate. If it were me, I would fight like a wounded badger.
Posted By Anonymous Robert, Cotati, CA : 5:52 PM ET
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