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PMW report: Four Loopholes in US anti-terror law

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Special Report - June 16, 2004‎

Four Loopholes in US anti-terror law
Flaws in US law enable recipients to support ‎anti-American activities and promote terror

by Itamar Marcus and Barbara Crook

Executive Summary
Four flaws in the Anti-Terrorism Certification requirement:‎
‎1.‎ Exempted Recipients
‎2.‎ Ignoring the Money Chain
‎3.‎ Ignoring Fungibility of Budgets
‎4.‎ Defining and Renouncing Terror

‎6 Recommendations for legislation to close the loopholes
‎1.‎ Recommendation #1‎
‎2.‎ Recommendation #2‎
‎3.‎ Recommendation #3‎
‎4.‎ Recommendation #4‎
‎5.‎ Recommendation #5‎
‎6.‎ Recommendation #6‎

Summary of all 6 Recommendations

Executive Summary
The Study:

An integral component of the United States’ war on international terrorism is to cut off funding to ‎terrorists and their supporters. This special report examines the deficiencies in US anti-terror laws. It ‎demonstrates how US anti-terrorist policy is being undermined in the Palestinian Authority (PA) areas, ‎and documents examples in which recipients of US money are involved in anti-American activities and ‎terror promotion.‎


Current US law is severely flawed, with loopholes that allow US money to end up in the hands of ‎those that promote terror, glorify terrorists, and sponsor anti- American activities.‎

At the center of US policy is the requirement that organizations receiving US funding obligate ‎themselves not to support or promote terror by signing an anti-terror clause called the Anti¬Terrorism ‎Certification (ATC). (See ATC text: Appendix 1). The Palestinian Authority and its NGOs have ‎adamantly rejected the US anti-terror conditions. (See Appendix 2). This universal rejection was ‎reiterated in a vote of the PA Legislature this month:‎

‎"The [Palestinian] Legislative [Council] rejects USAID (United States Agency for International ‎Development) conditions regarding support to local organizations (NGOs)... [that is signing] a ‎commitment not to support, finance, or join activities of institutions or individuals of terrorist nature, by ‎the known American definition.” [Al-Hayat Al-Jadida (Fatah), June 2, 2004]‎

It is paradoxical that in spite of the universal rejection by the PA and Palestinian NGOs (Non-‎Governmental Organizations) of the US anti- terror requirement, USAID continues to fund numerous ‎projects in PA areas, totaling more than $174 million in 2003, with similar funding planned for 2004. ‎‎( This flow of US money continues to PA ‎areas because of loopholes in the current US law that allow US money to end up benefiting those who ‎refuse to sign the Anti-Terrorism Certification as well as those who reject its anti-terror terms. This ‎report examines those loopholes.‎

For example, US money continues to be used to honor terrorists, including murderers of Americans. ‎Last month the PA inaugurated the “Martyr Salakh Khalaf (soccer) Stadium” built by USAID at a ‎cost of $500,000 (Al-Hayat Al-Jadida (Fatah), May 9, 2004). Salakh Khalaf, better known as Abu Iyad, ‎was head of the Black September terrorist organization, and was responsible for the murder of two ‎American diplomats, Cleo Allen Noel, Jr. and George Curtis Moore in Sudan in 1973, and the murder ‎of 11 Israeli athletes at the Munich Olympics in 1972. The following appeared this week in the PA ‎daily:‎

‎"The Shahid [Martyr] Salakh Khalaf [Abu Iyad] Stadium was inaugurated [Friday]. speeches were ‎made by UNICEF representative in Palestine, Jonathan Hutchen... [and] in the name of USAID, who ‎financed the project. Deputy Minister of Youth and Sport, Dr. Jamal Muhaisen, thanked the ‎sponsoring and supporting agencies and praised the management of the Shahid (Martyr) Salakh ‎Khalaf Center. which is considered one of the most important and of the ‎biggest sport centers ... Honor shields were presented by the Ministry of Youth and Sport to Save ‎the Children [and to] USAID.” [Al-Hayat Al-Jadida (Fatah), May 30, 2004]‎

Another recent striking example is one in which the same article describing use of funds by the ‎Gaza City Council to honor terrorists also cites the transfer of $10,000 of USAID money to the ‎same Gaza City Council, albeit for different projects.‎

‎"The Gaza City Council decided, in a recent meeting, to name a street after the distinguished Shahid ‎‎(Martyr) Sheik, Ahmad Yassin (leader of the Hamas terror organization that killed hundreds through ‎suicide bombings) as memorial and honor to his sacrifice and struggle. The city spokesman, Nasser ‎Al-Sawir... said that the City Council, since the beginning of its tenure - 10 years ago - has named ‎more than 300 city streets after Palestinian and Arab Martyrs ...‎ The City Council reported that the USAID decided to grant the city $10,000 in the framework of the ‎‎"Cash Transfer” project. to cover part of the expenses of repairing the damage to the water and ‎sewage systems ...” [Al-Hayat Al-Jadida (Fatah), May 24, 2004]‎

Clearly, there are serious flaws in the American law.‎

Four flaws in the Anti-Terrorism Certification requirement:‎

‎1.‎ Exempted Recipients

The law exempts numerous categories of recipients and services; thus bypassing the ATC is ‎relatively simple.‎

‎2.‎ Ignoring the Money Chain

US law does not place sufficient restrictions on the way primary recipients, including international ‎organizations receiving US money such as the World Bank and the United Nations (UN), give out ‎money originating in the US.‎

‎3.‎ Ignoring Fungibility of Budgets

US funding agencies routinely ignore terror promotion and anti-American activities of recipients when ‎these activities are not directly funded by US money.‎

‎4.‎ Defining and Renouncing Terror

The PA and its NGOs disagree with the US definition of terror.‎

Analysis in Depth:

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