Three years ago, two dozen FBI agents raided the headquarters of the Global Relief Foundation outside Chicago, the second-largest Islamic charity in the United States. Without a warrant, they stripped it clean of records and froze $900,000 in assets.
The same day, NATO troops searched the charity's offices halfway across the world in Kosovo, the strife-torn southern province of Serbia. A NATO statement cited "intelligence information" that some Global Relief officials may have been "planning attacks against targets in the U.S.A. and Europe."
It was another 10 months before the U.S. Treasury Department officially designated the charity a supporter of terrorism, citing links to Osama bin Laden. By then, Global Relief was already out of business.
"Our organization is dead and gone and cannot be revived now," said Roger C. Simmons, the charity's lawyer.
The designation process has set off an intense debate between attorneys for several Islamic charities in the United States, who say their clients are being denied normal U.S. legal protections, and government officials, who say that the designations are being carefully managed and reflect the realities of the post-9/11 world.
As of today, neither Global Relief nor any of its officials have been charged with a crime. Charity officials have also not had a chance to confront all of the government's evidence linking the group to terrorism. The classified evidence remains out of reach, and much of the unclassified evidence turned out to be allegations in newspaper clippings.
Global Relief is one of three Islamic charities that were forced to shut down before they were formally declared "specially designated global terrorists" as part of the U.S. government's three-year-old campaign to starve terrorists of funds. So far, more than 390 groups and individuals have been designated supporters or financiers of terrorism under the program -- meaning they are subject to seizure of assets and prevented from doing business with anyone without government permission.
The government's treatment of Global Relief and other charities "raises substantial civil liberties concerns," said a report on terrorist financing that the 9/11 commission published in late August. Being able to freeze assets of a group pending an investigation "is a powerful weapon with potentially dangerous applications when applied to domestic institutions."
Because U.S. authorities face enormous obstacles in gathering evidence usable in court, the report found, the Treasury designations were being based on more nebulous "links" to terrorists rather than hard proof of "funding." The report said attorneys for charities such as Global Relief -- "experienced lawyers steeped in the federal courts' rules of evidence and due process" -- found the designations "manifestly unfair," citing the use of classified evidence and material that would normally be considered hearsay.
A Treasury official said the government believes it is on firm legal ground. Global Relief failed in appealing the freeze on constitutional grounds. A federal judge who reviewed the classified evidence concluded that there was "probable cause to believe Global Relief and the executive director were agents of a foreign power." The charity now awaits a hearing on the merits of the government's evidence.
"The designation process, including the ability to block [funds] pending investigation, is a very important tool used to combat terrorist dollars," Treasury spokeswoman Molly Millerwise said.
Of the 20 groups or individuals who have tried to get their designation overturned, only seven have succeeded, six of them coming out of a single case. The rest face what amounts to a life sentence, their lawyers said.
"Once designated, there is no time limit for when the designation runs out," said Stanton D. Anderson, a Washington lawyer who until last month represented Saudi businessman Yasin al-Qadi, who was designated shortly after the 2001 terrorist attacks. "It's a lifetime bar. That's pretty draconian."
The charity lawyers complain that there is no legal definition of a "specially designated global terrorist." Millerwise provided a fact sheet from the State Department's counterterrorism office stating that a global terrorist is anyone determined "to assist in, sponsor, or provide financial, material or technological support for" anyone engaged in terrorism or designated as a terrorist supporter.
Charity lawyers and their supporters say that definition is so sweeping and vague that it is virtually meaningless.
"If the category has no definition, then how would a group who challenges the designation know what it is?" asked Georgetown Law Center professor David Cole, who is involved in a California case. "It's whatever the government says it is."
Juan Zarate, Treasury's assistant secretary for terrorist financing, said in an interview that the government had used its powers to freeze assets sparingly and been upheld by the courts.
"If they looked at these cases, the American people would certainly support the way we've used it," Zarate said.
Six weeks after the attacks of Sept. 11, 2001, Congress passed the USA Patriot Act. The legislation broadened presidential authority under the 1977 International Emergency Economic Powers Act, which allows a president to determine an "extraordinary threat" from abroad and impose sanctions. The act had been primarily used to take economic measures against "rogue nations" such as Cuba, Vietnam, North Korea and Libya.
Designations under the act are formally determined by the secretaries of state or treasury in consultation with a high-level interagency committee. Treasury's Office of Foreign Assets Control compiles the information to support the designations, implements sanctions and forwards names to the United Nations, which marks them as international pariahs.
So far, Treasury has not succeeded in obtaining a terrorist conviction against any of the three charities whose assets were frozen pending investigation -- Global Relief, Benevolence International Foundation and al Haramain Islamic Foundation. Only one charity official has been convicted on any criminal charge -- Enaam Arnaout, executive director of Illinois-based Benevolence. He pleaded guilty in February 2003 to fraudulent diversion of $316,000 in donations to Chechen and Bosnian combatants and was sentenced to 11 years in prison.
One cited example in the Sept. 11 terrorism financing report involved the designation in November 2001 of Al Barakaat, a worldwide network of money remitters centered in the United Arab Emirates (UAE) and used mainly by immigrants from Somalia.
Federal agents raided eight of Al Barakaat's U.S. offices and froze their assets. Then-Treasury Secretary Paul H. O'Neill called Al Barakaat the "quartermasters of terror" and "a principal source of funding, intelligence and money transfers for bin Laden."
In an unprecedented display of cooperation, the UAE central bank gave U.S. investigators unfettered access to Al Barakaat's records, turning over 17,000 pages of documents.
The result: "The FBI could not substantiate any links between al-Barakaat and terrorism," the 9/11 commission stated.
A Look at the Evidence
Global Relief, with its headquarters in Bridgeview, Ill., had raised $5.2 million in 2001 and claimed "over 20,000 contributors" and a mailing list of more than 250,000 people, according to court documents. It had aid programs in 22 countries including hot spots such as Bosnia, Afghanistan and Chechnya. After the charity's assets were frozen on Dec. 14, 2001, it appealed to the courts and Treasury.
In June 2002, an Illinois federal court sided with the government. "As a general principle," wrote U.S. District Judge Wayne R. Andersen, "this court should avoid impairment of decisions made by the Congress or President in matters involving foreign affairs or national security."
Global Relief's lawyers have been fighting for years to obtain all of the evidence against their client, classified and unclassified. In late March 2002, Treasury turned over four large volumes containing unclassified materials seized from Global Relief's U.S. offices and other evidence. A Post reporter who reviewed the materials found that they included 61 newspaper articles dating back to 1999.
"We found ourselves trying to rebut newspaper reports from around the world," Simmons said.
Not until Simmons had read the 9/11 commission's terrorist financing report in late August did he get a glimpse of the government's classified evidence: various internal FBI documents predating the Sept. 11 attacks.
One memo from 2000 said that "although the majority of GRF funding goes toward legitimate relief operations, a significant percentage is diverted to fund extremist causes." The FBI agents had been unable to substantiate this, however. "The money trail generally stopped at the U.S. border, and the agents could never trace it directly to jihadists or terrorists," the monograph said.
The report also disclosed that U.S. intelligence agencies had records of phone calls between the director of the Global Relief's branch in Belgium and Wadih el-Hage, bin Laden's personal secretary who was convicted for his role in the 1998 U.S. Embassy bombings in Kenya and Tanzania.
Simmons provided Treasury with an affidavit from the director in question, Nabil Sayadi, who stated he had talked to el-Hage a number of times between 1995 and 1997. The reason, he said, was that el-Hage wanted Global Relief to fund a malaria eradication project in Kenya and a scheme to import sesame seeds from Sudan. Sayadi said he rejected both ideas.
In the end, the report's authors, who were given access to Treasury's internal documents supporting the designation, agonized over the dilemma posed by the charities: "There may not have been a smoking gun proving that these entities funded terrorism, but the evidence of their links to terrorists and jihadists is significant."
But in conclusion, the report asked whether the destruction of Global Relief and Benevolence had been worth the price: "Did it enhance the security of the United States or was it a feckless act that violated civil rights with no real gain in security?"
The Chechnya Connection
Three months after it froze Global Relief's assets, Treasury targeted a Saudi government-supported charity, al Haramain Islamic Foundation. It operated in 50 countries, providing health care and welfare assistance, and proselytizing for Wahhabism, the kingdom's strict Islamic official creed.
In March 2002, Treasury designated al Haramain offices in Somalia and Bosnia as financiers for terrorists, and prevailed upon the Saudis and local governments to close them, presenting the Saudis with U.S. intelligence on the charity's "ties to terrorism," the Sept. 11 monograph stated.
One by one, al Haramain's branches in Africa, Asia and European were designated and closed. The assets of the branch office in Ashland, Ore., were frozen in February.
Al Haramain's Washington lawyer, Lynne Bernabei, asked Treasury for the evidence against her client. She said she received mainly articles from newspapers and policy journals.
Treasury also sent the affidavit of an IRS agent who outlined how he had tracked hundreds of thousands of dollars moved by the charity's Saudi treasurer, Soliman Albuthi. The agent said Albuthi had failed to declare $130,000 in traveler's checks when he traveled from the United States to Saudi Arabia in March 2000.
The agent concluded that the money was destined for Chechen rebels battling Russia.
In reply, Bernabei submitted Saudi and Russian documents showing that Albuthi had deposited the money with the charity's headquarters in Riyadh. The funds were used to finance aid to Chechen refugees, an act that had been officially approved by both Saudi Arabia and Russia, according to documents provided by Bernabei.
Bernabei was in the process of delivering the documents to Treasury on Sept. 9 when Treasury designated Albuthi and al Haramain's Oregon office -- nine months after the initial freeze.
For the first time, Bernabei learned that the U.S. government believed there were "direct links" between the Oregon office and bin Laden. The Treasury statement said U.S. intelligence showed donations to Chechen refugees "were diverted to support mujahideen as well as Chechen leaders affiliated with the al Qaeda network."
In an e-mail sent from his home in Riyadh, Albuthi denied supporting terrorists. "I just bring the money from US to fundraiser in SA and I got a receipt from the cashier with notice that this is for our Muslim brothers and sisters in Chechnya," he wrote.
Researcher Alice Crites contributed to this report.