MIAMI, June 21 -- A federal jury today convicted a Charlotte businessman of financing suspected Hezbollah terrorists in Lebanon with profits from a multimillion-dollar cigarette-smuggling operation that he ran with his brother.
The jury in Charlotte found Mohamad Hammoud, 28, whom prosecutors described as the leader of a terrorist cell, guilty of violating a ban on material support of groups designated as terrorist organizations by the United States. Hammoud and his brother, Chawki Hammoud, 37, both natives of Lebanon, were convicted of cigarette smuggling, racketeering and money laundering.
Mohamad Hammoud is the first person tried under the 1996 federal law that bans support for terrorist organizations. Twelve people nationwide have been charged with the offense, said Robert J. Conrad, U.S. attorney for the Western District of North Carolina.
"This jury's verdicts signal that terrorists and their supporters will not be safe from prosecution," Conrad said.
Bruce Hoffman, a terrorism expert with the Rand Corp. policy institute, added: "It's significant because if we're going to be the leader in the global war on terrorism, then, obviously, we have to set a clear example at home.
"What's worrisome is that, at least before September 11th, all these groups viewed the United States as some sort of benign operational environment or fertile ground."
Defense attorneys said they will appeal the verdict.
"This soon after September 11th, this jury could've come back in two hours and convicted these guys on everything," Deke Falls, attorney for Mohamad Hammoud, told the Associated Press.
The Hammoud brothers were arrested in the summer of 2000. They were accused of smuggling at least $7.9 million worth of cigarettes out of North Carolina, where they could buy them cheaply because of a low tax rate, and selling them at an illegal profit in Michigan.
Prosecutors were able to prove that $3,500 in profits from the venture were funneled by Mohamad Hammoud to high-ranking Hezbollah leaders, though prosecutors suggested that he also sent other money to Hezbollah. The relatively small amount of money involved can be deceptive, terrorism experts say.
"Terrorism is, in a way, an inexpensive operation . . . warfare on the cheap," said Yonah Alexander of the Potomac Institute for Policy Studies, a Washington area think tank.
Mohamad Hammoud faces up to 155 years in prison, which could be increased if the judge rules he lied during testimony. Chawki Hammoud faces 70 years in prison.
Jurors watched hours of Hezbollah videotapes seized from Mohamad Hammoud's home, including chilling propaganda footage of crowds chanting, "Death to America! Death to Israel!" They also heard recordings of phone conversations between Mohamad Hammoud and several alleged leaders of Hezbollah, including the group's reputed military chief, Sheik Abbas Harake, and the man long identified as its spiritual leader, Sheik Muhammed Hussein Fadlallah.
Mohamad Hammoud told jurors Fadlallah is not a member of Hezbollah.
Described by courtroom observers as intelligent and well-spoken, Mohamad Hammoud did not deny smuggling cigarettes. But he said he used the proceeds to help family members in Lebanon and to support Hezbollah's efforts to distribute books at schools and improve public water systems.
The trial stems from the July 2000 arrest of 18 people, most of them from Lebanon, on cigarette-smuggling charges. Seven defendants pleaded guilty to a variety of smuggling charges. They included Mohamad Hammoud's wife, Angie Tsioumas, who testified that he had once told her there were things about him she didn't need to know.
Security at the trial was tight. Concrete barriers and armed federal marshals ringed the courthouse.
Jurors deliberated for three days. Two hours before reaching their verdict, they sent a note to U.S. District Judge Graham Mullen in which they said they were deadlocked on the charge of lending material support to a terrorist group.
Mullen told them to keep deliberating.
