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NATIONAL COMMISSION ON TERRORIST ATTACKS

UPON THE UNITED STATES

TEAM #4 WORKPLAN

TERRORIST FINANCING

Team Members: John Roth

Douglas Greenburg
Serena Wille

Item 1 Key Questions

Item 2 Suggested Readings and Briefings

Item 3 Document Requests

Item 4 Interview Candidates

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Team #4
Item 1: Key Questions

1. What are, and should be, the goals of government efforts in the area of terrorist
financing?

• Government efforts concerning terrorist financing appear to have three goals: (1)
obtaining intelligence regarding terrorist activities and operations; (2) disruption
of terrorist activities and operations; and (3) depriving terrorists of resources
through executive or judicial action. To what degree has the government pursued
each of these goals? Have the goals changed over time? How much emphasis
should be placed on each of these goals?

• The government has stated that the premise of the effort on terrorist financing is
that "money is the lifeblood of terrorism." Given the demonstrated ability of
terrorists to use relatively tiny amounts of money to create significant attacks,
should this be the most important goal? Are efforts directed at that goal
detracting from the other goals?

2. Prior to 9/11, what did the U.S. do to identify and stop terrorist funding?

• The primary public effort within the U.S. was to identify and name specific
terrorist groups and then attempt to financially isolate them through the use of
executive orders. How successful were these efforts?

• Various government policies were instituted to allow for more effective tracking
and attacking of terrorist assets. What were these policies? Did they work? Why
or why not?

• There have been a number of the public criticisms about the government's pre-
9/1 1 efforts: a failure to appreciate the threat, unclear roles among the institutions
involved, a failure to share information, no overall strategy, and an unwillingness
or inability to get the necessary cooperation from key foreign governments. How
valid are these criticisms?

3. How were the 9/11 terrorists able to generate and move their money?

• What were the identifiable financial transactions of the hijackers? Where did they
get their funding, where did they keep their funds in the United States and how
did they distribute their funds among the 19 hijackers? Did anyone in the United
States itself provide funding to the hijackers?

• What do these transactions say about how organized, planned terrorist operations
operate within the United States? Are they different from other terrorist
operations, such as ad-hoc terrorist operations or the maintenance of sleeper cells?
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• How did Al Qaeda generally raise and move funds to support itself as an
institution? For example, how did it raise money to pay for training camps and
bring recruits to Afghanistan for training?

4. Does the fact that the 9/11 hijackers were able to evade detection and disruption
tell us anything about the system in place at the time?

• Were the various anti-money laundering controls in place sufficient to detect the
types of movement of money involved here? Why or why not? Was the existing
system simply not designed to detect the type of transactions engaged in by the
9/11 terrorists?

• Was there any concerted effort to track contemporaneously known terrorists cells
through their financial transactions? Did the government have the technical
ability to do so? What would such a system look like?

• What were the other deficiencies with the pre 9/11 system? For example, were
there shortcomings in efforts to prevent the abuse of charities, regulate informal
money transmitters, identify illegal trade-based money movements? Did we
effectively engage key foreign governments, particularly Saudi Arabia, to assist?

5. What are we currently doing, and have these efforts eliminated the deficiencies
present before 9/11?

• The U.S. government has devoted substantial resources since 9/11, including
enacting significant new regulations, in an effort to disrupt and curtail the funding
of terrorist organizations. What were those changes? Are they effective? Are the
deficiencies that may have contributed to the 9/11 failures still present?

6. What specific, actionable policy recommendations can be made to improve the

current efforts in light of the lessons of 9/11?

• Should the goals of the efforts regarding terrorist financing be changed? If so,
how?

• Is the government effectively organized to provide for adequate coordination

among the various agencies and actors involved in the effort? If not, how could
the structure be improved?

• How has, and how will, the raising and movement of money for terrorist
operations change in response to government actions? Is there a move away from
formal financial systems into something more difficult to detect? Can the
government recognize and quickly adapt to those changes?

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• What is the best approach to increase the ability and the willingness of key
foreign states to track and disrupt terrorist financing?

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Team #4
Item 2: Suggested Readings and Briefings

Council on Foreign Relations, Terrorist Financing, 2002 [Relevance: Most

complete discussion of the issue to date. Staffed and written by leading experts in
the field. Makes specific policy recommendations worth considering.]

National Commission on Terrorism, Final Report, pages 26 to 29. [Relevance:

Discussion of the issue and recommendations to stop non-state financial support
of terrorism worthy of consideration. Failure to implement recommendations also
worth discussion.]

Financial Crimes Enforcement Network, SAR Report no. 4 [Relevance: U.S.

Government's first efforts at identifying a typology for domestic financial
transactions relating to terrorism. Open to question how useful such a typology
is, given the innocuous nature of terrorist-related financial transactions.]

Financial Action Task Force, Special Recommendations on Terrorist Financing,

October 31, 2001. [Relevance: Best efforts to date on international cooperation
and standards setting.]

Indictment. United States v. Zacarias Moussaoui [Relevance: good illustration

of the use of a financial investigation to determine the scope and nature of the
conspiracy.]

National Money Laundering Strategy 2002, Goal 2 [Relevance: U.S.

government's published strategy on attacking terrorist financial networks]

Briefings

David Aufhauser, Treasury General Counsel [Head of US government's policy and

coordination efforts in terrorist financing]

Lee Wolosky, Council on Foreign Relations Task Force [co-author of report on terrorist
financing]

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Team #4
Item 3: Document Requests

1) Select OFAC decision packages

a) Al-Qaida and bin Laden (8/22/1998)
b) Taliban (7/4/1999)
c) Other relevant OFAC decision packages

2) Relevant documents from Policy Coordination Committee (PCC) for terrorist

financing reflecting policy changes since 9/11.

3) Documents relating to Presidential Decision Directives 39 (counterterrorism

coordination), 42 (international organized crime) and 63 (critical infrastructure
protection).

4) Relevant documents from NSC's Counterterrorism Strategy Group, pre-9/11.

5) Lists and summaries of pre-9/11 FBI terrorist financing investigations.

6) FinCEN BSA data and analytical products relating to terrorist financing.

7) Relevant State Department documents concerning cooperation by foreign

governments on terrorist financing, particularly concerning states through which
passed financing for the 9/11 hijackers or Al Qaeda (including relevant
communications to/from U.S. embassies in these states).

8) Financial analysis of 9/11 attacks, created by FBI's Terrorist Financial Review Group
(later renamed Terrorist Financing Operations Section).

9) Other documents as suggested by the Joint Inquiry report.

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Team #4
Item 4: Interview Candidates

NSC
Jody Myers
William F. Wechsler
Richard E. Clarke

Customs
Marcy Forman, Director, Operation Green Quest, US Customs
Director, US Customs Service Office of Strategic Trade and Intelligence

FBI
Dennis Lormel, Terrorist Finance Operations Section

Treasury
Jim Johnson, former Undersecretary for Enforcement
Ron Noble, former Undersecretary for Enforcement
Elisabeth Bresee, Assistant Secretary for Enforcement
Kenneth Dam, former Deputy Secretary
David Aufhauser, General Counsel
Jimmy Gurule former Undersecretary for Enforcement, 2001-03
Juan Zarate, DAAS for terrorism
Bob McBrien, OFAC
Richard Newcomb, OFAC, Director
Jim Sloan, FinCEN, Director
David Voght, FinCEN, Office of Intelligence
Peter Djinis, former FinCEN, Office of Financial Enforcement

IRS
Steven Miller, Director, Exempt Organizations, Tax Exempt/Government Entities
Division, IRS
Martha Sullivan, Director, Compliance, Small and Medium Sized Businesses, IRS
(MSBs)

State
Unit head, Office of the Coordinator for Counterterrorism, Counterterrorism Finance and
Designation Unit

Justice
Michael Chertoff, AAG
James Robinson, former AAG
Alice Fisher, DAAG
Bruce Swartz, DAAG
Jim Reynolds, former Chief TVCS
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Barry Sabin, Chief CT (formerly TVCS)

Jeff Breinholt, CT section, terrorist financing
Gordon Kromberg, AUSA, EDVA

Private industry and independent policy analysts

John Byrne, American Bankers Association
Rick Small, Director for Global Anti-Money Laundering, Citigroup
Director of compliance, SunTrust
Michael Zeldin, partner, Deloitte and Touche
Kenneth Katzman, Congressional Research Service
Lee Wolosky, Council on Foreign Relations
Jon Winer, former Deputy Assistant Secretary of State
Steve Emerson, The Investigative Project

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