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Sun 22 May 2011 12:59 PM

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Loss of bin Laden adds to al Qaeda money woes

Al Qaeda heads face prospect of a cash crunch that would complicate task of evading capture by the US

Loss of bin Laden adds to al Qaeda money woes
A photo shows front page coverge in Melbourne on May 3, 2011, of the death of Osama bin Laden in a firefight with US troops in Pakistan. As Australians reacted to the news Osama bin Laden is dead, a new study shows they are still concerned by the threat of terrorist attack. Australian security and intelligence agencies have kept the threat level at medium, saying a terrorist attack is feasible and could happen at any time. (AFP/Getty Images)

Deprived of Osama bin Laden's fundraising starpower, al Qaeda's commanders face the prospect of a cash crunch that would complicate the task of evading capture by their US pursuers.

The likely successor to Osama bin Laden is Ayman Al Zawahri, an Egyptian who lacks the former Saudi-born figurehead's depth of contacts among potential donors in the Gulf, a region seen in the West as an important funding source for militant groups.

Counter-terrorism officials caution that it does not take much money to launch terrorist attacks, and that for much of al Qaeda's network, donations appear less important. Crime and kidnap, for example in Iraq, Yemen, Mali and Niger, have proven lucrative funding sources for al Qaeda locally.

But for the core leaders of al Qaeda, believed to be sheltering in Pakistan, donations remain key, and so a large fall in revenues could threaten their ability to pay for and maintain safe houses and networks of discreet support.

While a strike on the West directed by al Qaeda's central leadership might inspire fresh donations, it is survival, rather than new operations, that is likely to be the commanders' top short-term priority, counter-terrorism officials say.

Mustafa Alani, a security analyst at the Gulf Research Centre based in Dubai, said there were two sorts of donors in the Gulf who habitually gave to bin Laden.

There were those motivated by ideology to support armed action against the West, and those who gave "because of a personal connection, because they trusted or admired bin Laden."

"The latter category is going to dry up, definitely."

London-based journalist Abdel-Bari Atwan, who interviewed bin Laden in 1996, said he understood that most of the donations received by al Qaeda still came from the Gulf, where the widespread use of cash makes tracing illegal payments hard.

"But now he is gone, it will not be flowing as it was."

Zawahri is viewed with caution by some militants in the Gulf, partly because he is Egyptian and partly because he is seen, rightly or wrongly, as secretive and conspiratorial.

"Bin Laden had appeal for them, Zawahri doesn't," Saudi businessman Hani Yamani said.

Yamani, a board member of Saudi-based charity the International Islamic Relief Organisation, said Gulf charities had cracked down on the diversion of relief money to al Qaeda.

As a result, he said, al Qaeda's leaders had probably had to ask for money from their offshoot groups, who had income from crime.

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A decade ago, things were very different.

Al Qaeda's fund-raising provided an estimated annual budget of $30m at the time of the 2001 attacks on US targets.

According to US military documents provided to media organisations by the website WikiLeaks, a Pakistani detainee at the Guantanamo Bay prison called Saifullah Paracha arrested in 2003 received at one point for "safekeeping" between $500,000 and $600,000 from Khaled Sheikh Mohammed, the operational planner of the September 11 attacks.

It would be surprising to see such large sums nowadays in dealings among al Qaeda core commanders, not least because they have made no secret of their money worries.

Al Qaeda has made repeated public appeal for donations to its followers in online statements.

Adding to the picture of financial strain, al Qaeda trainers in Pakistan have demanded up front payments to cover expenses and "tuition fees" from would be-fighters arriving from overseas to learn guerrilla warfare and bombing skills, according to testimony court from captured militants.

Most analysts speculate the decline in revenues is driven in part by tighter curbs on charities in the Arab world that have prevented the diversion of relief funds for violent ends.

The raid that killed bin Laden made this bad financial situation even worse.

The trove of information seized in the assault is likely to provide "a starburst" of connections and clues shedding light on al Qaeda's support networks, when powerful data mining tools are applied, says former US counter-terrorism official Fred Burton, now vice president at risk consultancy Stratfor.

"Tracing the money trail will play an active role in showing ... a web of safe houses, travel and bank accounts," he said.

Zawahri, who worked as a doctor at one point in Saudi Arabia, is not totally without appeal in the Gulf.

Anna Murison, head of jihad forecast at Exclusive Analysis, Murison pointed out that in at least one case al Qaeda's Yemen based Gulf branch had raised money in the region using a message by Zawahri that was saved to a fundraiser's mobile phone, "suggesting his endorsement does carry some weight."

But overall his funding potential is seen as poor.

Richard Barrett, head of the UN al Qaeda and Taliban sanctions committee, said there might be a brief increase in donations "as a sort of sympathy vote" after bin Laden's death.

But the loss of a man who inspired broad support meant the group's leaders would probably now struggle for funds, he said.

Also, "donors may now wonder where al Qaida is headed under a new leadership. Saudi donors may, for example, be less interested in giving to al Qaeda if its focus will be on Egypt."

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