The Australian Crime Commission and AUSTRAC testified, at a Senate committee, that they have limited powers to track money once it goes offshore. So why are we taking the risk of funding Islamic organisations?
DISCLAIMER: I am not trying to suggest in this post that Australian halal certification does directly fund terrorism, I have no evidence of that myself, however various red flags have been raised, such as financial mismanagement by Islamic organisations, lack of traceability of money transfers etc, some of which deserve further investigation. Whether further inspection will find funding of terrorism I can’t say, however halal certification monies have been passed to Islamic groups with extremist views (such as MUI, who endorse female genital mutilation – see my other post).
And in particular, the 4 terrorist attacks that have been carried out on Australian soil in recent years have all been by Muslims, and virtually all other foiled attacks have also been planned by Muslims. Therefore considering we currently have an enormous problem worldwide with Islamic fundamentalism and terrorism, I believe that any monies passing to the hands of Islamic groups deserves extra scrutiny.
At the time of the 2015 Senate inquiry into third-party certification of food a headline was bandied around in various newspapers that no “direct links” from halal certifiers to terrorism had been found. But many of these articles were misleading, as they did not address the fact that both the Australian Crime Commission (ACC) and AUSTRAC admitted to the Senate that they had limitations on their investigative powers, particularly once money goes offshore, i.e. as AUSTRAC testified, “We can see when money leaves Australia and goes offshore to the first point of recipient…if you were in the UK, for example, and I sent money to you, Senator, we can see the transaction. Where that money goes next is a difficult challenge for us because it is not part of what is reported to AUSTRAC.”
Furthermore AUSTRAC has previously flagged the indirect funding of terrorism, by funneling money through overseas charities, as a potential high risk.
Indeed as noted in both the Senate inquiry and on ABC Four Corners, some overseas halal certifiers have either been linked to, or known to funnel monies to charities that turned out to be funding terrorism.
Of course it could also be argued that any individual or organization could be funding nefarious deeds through offshore charities, but the reason why Islamic organisations require extra scrutiny is because we do have a worldwide Islamic terrorism problem that is obviously receiving funding from somewhere.
Whilst the ACC testified that due to media interest in links between halal certification and terrorism, they “have been on a heightened lookout for any links between halal certification” and did not subsequently find any direct links, they also admitted that that they were particularly focused on “money laundering and on serious and organised crime”. The point that was made to them by Senator Bernardi is that the transfer of halal certification funds, is a legitimate business activity, and therefore would not fall into the category of money-laundering, “They are not laundering money; they are just sending money overseas for a cause”.
Our crime bodies also have further limitations. AUSTRAC testified that they do not generally investigate domestic transfers under $10,000 unless it has been drawn to their attention as suspicious.
The Australian, “Muslim school stripped of $45m”
Furthermore some Islamic organisations, such as AFIC, have been embroiled in legal proceedings with allegations of severe financial mismanagement, such as siphoning $45 million worth of government school funding from one of the schools they manage, Malek Fahd. This is not the only AFIC managed school that has come under fire, indeed others have had their government funding revoked. AFIC, as a registered charity, has the advantage that they are exempt from the reporting and tax obligations of most Australian businesses. A number of other halal certifiers are also not for profits, others set up as businesses.
Australian Government, Department of Agriculture and Water Resources, “List of recognised Islamic bodies for halal certification of red meat” This is a screenshot of part of the list
Generally how halal certification operates is that the halal certifiers are hand picked by Islamic countries, particularly when it comes to red meat exports. It stands to reason that these countries are most likely to give their business to the halal certifiers that best fit their strain of Islam.
AFIC has a very cosy relationship with a number of these countries, and is one of a handful of halal certifiers approved for red meat exports to Saudi Arabia. They also are approved for Qatar.
Furthermore, particularly in the case of Indonesia, it has been alleged that some halal certifiers have been paying bribes to get these contracts.
The Guardian,”WikiLeaks cables portray Saudi Arabia as a cash machine for terrorists”
Whilst bribes, corruption and financial mismanagement does not necessarily lead to terrorism, when halal certifiers are handpicked by countries such as Saudi Arabia, any financial transactions should be carefully scrutinized, in light of Hillary Clinton’s statement that, “Donors in Saudi Arabia constitute the most significant source of funding to Sunni terrorist groups worldwide”.
Qatar too has recently been in the news, accused of funding terrorism.
In the past AFIC also had a close relationship with Libyan dictator Gaddafi, and indeed received funding from him.
The ABC Four Corners, “The Truth About Halal” episode discussed allegations of links from halal certification to terrorism. “Overseas, some halal certifiers have been linked to Islamic charities accused of assisting groups like Hamas and Hezbollah.”
Probably the most prominent Australian halal certifier to be embroiled in terrorist allegations was Mohammed El-Mouelhy.
Four Corners mentioned that El-Mouelhy “gives generously to Islamic charities, including Human Appeal International….HAI has been named overseas as a suspected fundraiser for Hamas by the US and Israeli governments. HAI’s Australian branch told Four Corners it has never funded Hamas or any of its affiliates.”
El-Mouelhy went on to concur that this charity does not fund Hamas, but if it were established that it did he would look for another charity to support.
And of course the ACC and AUSTRAC did mention that they have not found any evidence of direct links between halal certification and terrorism.
But possibly a major reason for why El-Mouelhy came under suspicion by the public was that it was reported shortly after the Lindt Café siege that one of his family members was in the Lindt café minutes before the siege took place. In fact both The Guardian and The Daily Telegraph, at the time, recounted lengthy interviews with her, however these reports were somewhat conflicting as to whether or not she had been in the café or nearby. And there also seemed to be some confusion as to whether she was his wife or his daughter.
In fact El-Mouelhy’s business is located not far from Martin Place, so presumably it would not be unusual for he or his family to be in the vicinity of the café, but to actually be in the café at that time would have been quite a close call. As proponents of halal certification it would also be hypocritical for them to be eating in Lindt, considering Lindt chocolate has resisted the urge to become halal certified, and El-Mouelhy’s business website states, “Muslims have certain dietary requirements that must be fulfilled by certification.” Unless they were at the Lindt cafe to try and persuade it to become halal certified?
But these reports combined with El-Mouelhy’s links to HAI may have made a nervous public jump to conclusions. Indeed El-Mouelhy ended up suing Halal Choices activist Kirralie Smith for defamation (they eventually settled out of court).
However since those early reports, no more mention of this appears to have been made again, so one would have to conclude that those reports of an El-Mouelhy being at the café are wrong. Most likely the inquest into the Lindt café uncovered the truth about this, but one has to ask, given the terrorism allegations that the El-Mouelhy family has endured, and the public unease about terrorism, surely it is in both the family and the public’s interest for these newspapers to either confirm or issue a rebuttal of these stories, and if the reports were false to explain why they were made.
When it comes to misleading newspaper reports, here is one from the ABC, titled “No direct link between halal certification and Islamic terrorism, Senate inquiry told”:
“Senator Cory Bernardi, who is on the committee, asked if the reason why AUSTRAC had come up with no evidence was because they were not looking at halal certifiers.
“The answer to that is ‘no’,” Craig Robertson, AUSTRAC’s acting national manager of intelligence, said.
“We’re not looking specifically at the use of those funds on the basis that I guess a third party outside of AUSTRAC hasn’t been able to refer us information that provides evidence to look at it, and our own detection and monitoring systems of what we know about how terrorism financing occurs has not surfaced that information.”
Whilst I’m not someone who normally questions the integrity of the ABC in terms of the accuracy of their reporting (I do at times question their bias however), having read the hansard this is not only somewhat misleading, it also appears that the ABC merged two separate sentences together, that would be fine if they used an ellipsis … to indicate the merging of two separate statements. I, myself, am no expert on correct referencing but in this case it appears to have been done to be misleading.
Because below is actually what is in the hansard:
Senator BERNARDI: Once again, I come back to this: have you specifically looked at the use of funds by organisations that conduct halal certification?
Mr Robertson: The answer to that is no, we are not looking specifically at the use of those funds. As Mrs Jamieson outlined in our opening statement, we do monitor for movements that relate to those activities. We use either names of entities or keywords, as we do for a range of things, in order to surface any information that we would then need to assess. But aside from those regular types of monitoring activities we do not have any active work against those movements of funds.
Senator BERNARDI: I have learned not to rely on ABC Fact Check. ABC Fact Check said, ‘A spokesman for AUSTRAC told Fact Check it had no information to indicate that there are links to terrorism financing from halal certification fees.’ That may be entirely accurate but it is because you have not investigated halal certification fees and the use of that.
Mr Robertson: Again, for clarity, we do not conduct the investigations per se—and I know it is terminology. On the basis that a third party outside of AUSTRAC has not been able to refer us to information that provides that evidence to look at it—and our own detection and monitoring systems of what we know about how terrorism financing occurs has not surfaced that information—the short answer is no.”
But there are other reasons for public unease about halal certification in general. What did come out in the Senate inquiry was that much of the Australian halal certification industry is extremely unregulated
The Australian halal certification industry is extremely unregulated with much of their activities shrouded in secrecy, and some of the responses given to the inquiry by halal certifiers were evasive. For instance the Senate committee could not establish how many halal certifiers there were in Australia (though it appears that there are at least 22). Therefore if no one knows who they all are, obviously they can not have all be investigated for terrorism!
This is not to say any Australian halal certifiers are funding terrorism, but with allegations of severe financial mismanagement, bribes and corruptions, secretive and evasive behaviours, and links to countries such as Saudi Arabia, in addition to a worldwide Islamic terrorism problem, the question should not be whether halal certifiers and Islamic organisations are funding terrorism, but should we be willing to take the risk that they might be? In particular given that many of these groups hold views that would be considered misogynistic and oppressive by most modern day Australians, one would have to ask what societal benefit to our country does funding these groups bring?
If you would like to read more, below are some of the excerpts regarding terrorism taken from the hansard of the Senate inquiry into the third party food certification (please be aware I have abbreviated some of this, so as to highlight the areas I think most relevant, but I try to make that clear by my use of ellipsis. The full Hansard can be downloaded at the end of this post):
AUSTRAC’s evidence (pg 13-14):
Senator BERNARDI: AUSTRAC is responsible for tracking domestic and external and international money transfers—is that correct?
Mr Robertson: Yes, in a broad sense, although we have much more limited visibility of domestic financial activity by virtue of what is legislated in terms of what is reported to us. The vast majority of the information that we hold relates to the movements of funds in and out of Australia, regardless of their value. We do have some direct reports of domestic activity, normally when they are performed in cash and when they are above a threshold of $10,000. As I am sure you have seen when you have travelled, you also have the cross-border movement of physical currency and that gets reported to AUSTRAC as well. The fourth type of report is a suspicious matter report, which does not have a threshold or a particular type that requires that report to be made.
AUSTRAC’s evidence (pg 14):
Mr Robertson: …we do not have any information that suggests that the entities we are aware of that provide halal certification are linked to the funding of those seeking to travel overseas to fight in Iraq or Syria or those who are onshore seeking to undertake any attack planning—
Senator BERNARDI: But you do not really track it, in essence, do you? You do not follow the certification money through a group like AFIC into a mosque or a bookstore where there are extremist materials and the conversion of people and the inspiring of jihadis is taking place.
Mr Robertson: The answer to that is: no, we do not follow those funds, particularly, for those entities who are engaged in halal certification.
AUSTRAC’s evidence (pg 14):
Senator BERNARDI: I will turn internationally, then. In a report published last year, Terrorism financing in Australia, AUSTRAC said:
The risks associated with the misuse of charities and NPOs are high as these organisations offer the capacity for groups to raise relatively large amounts of money over time.
I understand there are national security issues at play here, but how far do you track the funds that are used by international charities?
Mr Robertson: There is a challenge in that. We can see when money leaves Australia and goes offshore to the first point of recipient, if you like. To put a broader scenario: if you were in the UK, for example, and I sent money to you, Senator, we can see the transaction. Where that money goes next is a difficult challenge for us because it is not part of what is reported to AUSTRAC. If we identified that the transaction was suspicious, we have a number of arrangements with our counterpart type units in different countries. We could ask the question of those counterparts: what happened to those funds next? We would not do that for all the transactions. As I mentioned, we would only do that in cases where we formed a suspicion or one of our partner agencies has asked us to assist them in looking at those transactions and to engage our international partners.
The delivery of funds that go overseas for charitable purposes are often devolved into goods or cash, which are not part of what we are able to track.
AUSTRAC’s evidence (pg 14-15):
Senator BERNARDI: Let me give you an example: Human Appeal International. It is an international organisation that has ties to Hamas. Hamas is not a prescribed organisation in Australia, but the Hamas brigades are. You can track the money from Human Appeal International that sends out to Hamas. Is that right? They have to send it to an end recipient, so you know that it is going to Hamas or whatever their organisation is.
Mr Robertson: If Human Appeal International has a bank account in Australia and they send funds, yes, we would see where that money was.
Senator BERNARDI: But you cannot then track what Hamas does with the funding?
Mr Robertson: Based on what is reported to us, no.
AUSTRAC’s evidence (pg 15):
Senator BERNARDI: If a halal certifier boasts about supporting an organisation like Human Appeal International, which is directly linked to Hamas and has personnel on their international body that are linked to Hezbollah, which is not a good group of people, it is not too long a bow to draw and say, ‘The profits of halal certification are linked to organisations that are not acting in Australia’s interests?
Mr Robertson: That is when AUSTRAC does not have that investigative mandate in terms of an agency. If we were to see a scenario like that where funds do move, we would need to refer that to a partner agency who would investigate the offences of terrorism financing—they are not offences under our legislation, as you are no doubt aware—and/or then we could work with partner agencies to engage with the country overseas where that money has gone so that we can understand more about it.
Senator BERNARDI: I can find this out through a Google search, effectively. We have a bloke who is boasting and is contributing to a charity which is directly linked to those types of organisations. How can you not conclude that the profits of halal certification, which this man openly boasts runs into millions of dollars for him, are contributing to extremist organisations?
Mrs Jamieson: We look at the financial transaction reports that come in. As we said, halal certification, the business, does not fall under our legislation. So we revert back to the transaction reports that we then receive, which are the international funds transfers. Mr Robertson has explained to you what we do with that information when we receive it.
Senator BERNARDI: If I give money to a charity, AUSTRAC really only see the sum of money and who the recipient is when the charity distributes it. It really does not have any knowledge of my contribution to the charity—or does it? You do not have to answer that aspect of it.
Mr Robertson: It is easy to answer that in one sense. If you donated less than $10,000 to a charity in Australia and you put it into their bank account, it would not be reported to us; but if it was more than $10,000 and you put it into their bank account, it would be reported to us.
Australian Crime Commission (ACC) evidence (pg 18):
Mr Hansford: Equally, like the evidence that AUSTRAC provided earlier this morning, we have been involved in and funded for the response to Islamist terrorism by the Australian government, particularly focusing on money-laundering, and we are involved with a whole range of partners, including AUSTRAC. This is in addition to our daily work on anything from illicit drugs, gangs and high-risk crime targets, to cybercrime. So it is in this context that we made the following statement, and on 12 November—following a considerable number of media requests, and some statements by the media that actually identified the Australian Crime Commission as having found links between halal certification and terrorism—we put out a press release that said exactly what I said at the beginning: that we have found links between money-laundering, terrorism and serious and organised crime, but we have not found any direct links between halal certification and the funding of terrorism.
My evidence today is based on our operational work and the intelligence holdings that the Australian Crime Commission has. Since this issue has been highlighted in the press, we have been on a heightened lookout for any links between halal certification in our intelligence holdings, and to date we have not found any direct linkages.
Australian Crime Commission (ACC) evidence (pg 19):
Senator BERNARDI: I will draw on some of the evidence that was produced to us. For example, the Islamic Council of Western Australia the Islamic Council of Western Australia said in their 2013 annual report that they made donations to Syria, but they did it through a charity, the Al Imdaad charity, to ensure that no recriminations could be directed to the Islamic Council of Western Australia. So you could say if, for example, the Al Imdaad charity was involved in untoward activities in Syria—and I do not know whether it was, but there are no good guys in Syria, apparently—then there is no direct link to an Islamic certifier funding terrorism or extremist activity, but there may be cause for an indirect conclusion to be drawn.
Mr Hansford: I think that wherever there is a sector with large amounts of cash that are being remitted, there is an opportunity for either serious and organised crime or people sympathetic with terrorism to utilise and exploit that particular sector. That is the answer, but from the high-risk crime targets that we look at and the money laundering operations that we have undertaken, we have not seen a direct link.
Senator BERNARDI: We come back to this directly. If a certifying agency decides to remit funds overseas for whatever purpose—for humanitarian or charitable aims, either directly or through a third party—you are not really in a position to assess how those funds are utilised overseas. Is that correct?
Mr Hansford: That is correct. But we are in a position to understand how money is laundered by organised crime, and no sector in the Australian economy is really prone from infiltration by serious and organised crime, whether that is a bank or a casino, or the alternative remittance sector. All of them have the potential to be exploited, and for laundered money—
Senator BERNARDI: But we are not talking about money laundering. We are talking about legitimate businesses, or organisations in Australia, that raise money through the halal certification schemes or whatever, and then they say they are going to participate in an international outreach, either through a charity or anything else. They are not laundering money; they are just sending money overseas for a cause. There is no way you can assess, realistically, where every dollar of that money goes once it reaches an offshore destination like Syria or Iraq or Palestine, or anywhere else.
Mr Hansford: I guess the answer is that our focus is on money laundering and on serious and organised crime.
Senator BERNARDI: So we are talking apples and oranges.
Mr Hansford: Yes.
Kirralie Smith is a vocal anti Halal Certification activist, a prior member of the Australian Liberty Alliance she recently joined Senator Bernardi’s Australian Conservatives party.
Kirralie has been researching Halal Certification for many years and gave evidence that she has been harassed by many people, including prominent Muslim leaders, and the intimidation reached such a point that she had to move house and keep her location secret, all because she “dared to ask questions about the halal certification industry in Australia.”
Kirralie gave a lot of evidence in general about the Halal Certification industry but in relation to terrorism this is part of what she said:
Kirralie Smith’s evidence (pg 27):
Mrs Smith: …In Canada, the example is that the Muslim Association of Canada did raise money in a number of ways, and one of the ways was through halal certification. They then gave money to IRFAN of Canada, and IRFAN then channelled approximately $14.6 million to Hamas. In that time, IRFAN has been deregistered as a charity and is no longer able to raise funds that way. That was one documented way. In the US, it was the Holy Land Foundation around 2001. CAIR, in America, was another, similar to IRFAN; it was an unindicted co-conspirator of the Holy Land Foundation, which was also found to be funding terrorism at the time.
Kirralie Smith’s evidence (pg 27):
Mrs Smith: …obviously the reports were not read in their entirety and there was some cherry picking going on this morning as well. As I have said, AUSTRAC in 2010 said that they list financial contributions through formal charitable donations as one of the three most common methods by which terrorism funds are raised in Australia. We know that these halal certifiers are giving to those charitable funds. I do not think the question was answered this morning other than it was not a direct link. Yes, we need more transparency and more investigation so that the government can comprehensively and confidently say to consumers that our grocery purchase dollars are not going to fund extremists or terrorists.
The Senate Economics References Committee into third-party certification of food (2015):
(Below is the downloadable hansard of the hearing on 24th September 2015 only, as it is relates to terrorism, you can find the hansard for the rest of the hearings in my post here about Sharia by stealth):
ABC Four Corners, “The Truth About Halal”, http://www.abc.net.au/4corners/stories/2015/09/07/4305337.htm
ABC News, “No direct link between halal certification and Islamic terrorism, Senate inquiry told”,
Wikipedia, “AFIC”, https://en.wikipedia.org/wiki/Australian_Federation_of_Islamic_Councils
The Australian, “Muslim school stripped of $45m”, http://www.theaustralian.com.au/national-affairs/education/malek-fahd-islamic-school-stripped-of-45m-muslim-body-accused/news-story/bb08c4e84aa9989ec2bedc651a95b2f6
Australian Government, Department of Agriculture and Water Resources, “List of recognised Islamic bodies for halal certification of red meat”, http://www.agriculture.gov.au/export/controlled-goods/meat/elmer-3/list-islamic-halal-certification
The Guardian,“WikiLeaks cables portray Saudi Arabia as a cash machine for terrorists”, https://www.theguardian.com/world/2010/dec/05/wikileaks-cables-saudi-terrorist-funding
News.com.au, “Qatar crisis: Is Saudi Arabia supporting terror also?”, http://www.news.com.au/finance/economy/world-economy/qatar-crisis-is-saudi-arabia-supporting-terror-also/news-story/a58c4127caddf901b799fea2acaa9718
The Daily Telegraph, “The fuse of public fury has been lit as terror comes to Sydney”,
The Guardian, “Sydney hostage crisis: confusion and concern among crowds at scene”,
Halal Certification Authority, https://halalauthority.org/certification/