Bahamas Central Bank Unable To Help Swiss Terror Financing Investigators

by Amanda Banks, Tax-News.com, London

02 September 2005

The Central Bank of the Bahamas was unlikely to have been able to assist the Swiss authorities in a long-running investigation into a terrorist financing network, according to a report in the Nassau Guardian.

It was reported in June that the Swiss Prosecutors Office had accused the Bahamian regulatory authorities of failing to give "a useable response" to a request for assistance in a three-and-a-half year investigation into the Al-Taqwa network of companies, which has been accused by the United States of financing several Al-Qaeda terrorist operations.

However, since the banking arm of the Al Taqwa organisation ceased operations in the Bahamas in 2002 as the result of a government crackdown on 'brass plate' banks with no physical presence in the jurisdiction, and given the wide-ranging geographical reach of the organisation's network, the report concluded that the Central Bank of the Bahamas would, in all probability, not have been able to materially assist Swiss investigators.

The Swiss authorities called a halt to their investigation in June after the Federal Criminal Court ordered it to either prosecute the Al-Taqwa Management Organisation, which has since been renamed Nada Management Organisation, or cease its probe. According to the Prosecutor's Office, there was insufficient evidence for the case to go to trial because "several key elements" were missing in the chain of evidence.

However, in a parting shot, the Prosecutor's Office accused the Bahamas of hampering the investigation by failing to respond to a request for information.

The Swiss authorities cooperated with several other jurisdictions during the investigation, including neighbouring Liechtenstein, which froze the accounts of an affiliate firm, the fiduciary company Asat Trust, and Saudi Arabia, where the group was said to hold key accounting documents. In addition Al-Taqwa's presence was suspected in numerous jurisdictions, both onshore and offshore, such as Italy, Saudi Arabia, Jersey, Isle of Man, Turkey, Kuwait, the United States, Germany, Belgium, Albania, Austria, Bahrain, Singapore, Thailand, Bangladesh, and Pakistan.

The Al-Taqwa organisation, which operated along Islamic principles, was founded in 1988 by its Egyptian-born managing director, Youssef M. Nada, and his Syrian-born associate, Ali Himmat. It was based in the southern Swiss canton of Ticino until being liquidated in December 2001.

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