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Afghan Insurgents' Diverse Funding Sources Pose Challenges
Afghanistan, which has only a handful of banks, lacks a modern financial system. Tools commonly used to combat money laundering, such as freezing bank accounts or monitoring electronic wire transfers, are largely useless, U.S. officials said.
Most money transfers in Afghanistan are made under the hawala system, an informal network of money brokers who traditionally keep few, if any, records about their customers. With help from U.S. officials, the Afghan government has begun to regulate its hawala brokers for the first time. Brokers in seven provinces are now registered with the government and are required to report all transactions each month to the central bank, which conducts audits to ensure compliance.
Some hawala brokers have become informants, notifying authorities of suspicious or unusually large transfers. Accustomed to the traditional anonymity of hawala networks, Taliban supporters sometimes fill out their customer slips by plainly stating that the payment is for "heroin" or "five vehicles for Taliban commander so-and-so," said a senior U.S. law-enforcement official.
"Right now, they're at the point where they're not used to having anybody harass them," the official said. "I think we'll start to see more coded-type documents. It will start to say, 'For the Boy Scouts' or something."
The Taliban and its affiliates also move large amounts of cash via human couriers, both domestically and internationally, U.S. and Afghan officials said. Foreign recruits who travel to Pakistan to train in Taliban-sponsored camps are regularly asked to bring $10,000 in cash with them, the U.S. law-enforcement official said.
In Washington, the U.S. government recently established a group to devise an overall strategy for restricting the flow of money to the Taliban. The Illicit Finance Task Force is directed by the U.S. Treasury but draws on personnel from different agencies.
"We're going after this with a great deal of urgency and a huge amount of effort to even more effectively disrupt the networks that fund the Taliban," said David S. Cohen, the Treasury Department's assistant secretary for terrorist financing.