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[April 03, 2006]

$3 bil. flowed to Mideast terror groups through N.Y. bank: daily+

(Japan Economic Newswire Via Thomson Dialog NewsEdge)NEW YORK, April 3_(Kyodo) _ Manhattan District Attorney Robert Morgenthau has shut down a massive terror-finance pipeline in which $3 billion in profits from drug deals and other crimes flowed through a major New York bank to Middle East terror groups, the New York Post reported Monday.


Morgenthau declined to identify the bank but said it is "one of the largest and most prominent banks in New York," the Post said in a report from Washington.

He told the newspaper his office is pursuing a settlement involving possible penalties against the bank for maintaining an account where funds that originated in South America's notorious "tri-border region" were rerouted to suspect accounts in the Middle East.

"Evidence developed in the course of a three-year probe, which has already resulted in charges against other New York-based financial institutions, revealed that about $3 billion that flowed through the account over a two-year period was going to terror groups, Hamas, al-Qaida and Hezbollah," Morgenthau was quoted as saying.

Most of the $3 billion in suspicious funds were generated, through criminal enterprises, in the lawless tri-border region of Brazil, Argentina and Paraguay.

The money then flowed into bank accounts in several locations across the Middle East including Riyadh, Saudi Arabia, Beirut, Lebanon and Ramallah in the Palestinian territories.

The probe grew out of the Manhattan district attorney's previous 2004 prosecution of the Beacon Hill Services Corp., an Upper East Side money transmitter that moved more than $9 billion in suspect funds through accounts in Chase Manhattan Bank and other institutions.

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