Book Launch &#8211; <i>Blood From Stones: The Secret Financial Network of Terror</i>

In an afternoon discussion, journalist Douglas Farah, presented his book, Blood from Stones: The Secret Financial Network of Terror. Farah began by vividly describing Charles Taylor's violent climb to power in Liberia. Using ruthless techniques, including "small boy units," Taylor gained control over Sierra Leone's diamond fields through his manipulation of the Sierra Leonian Revolutionary United Front (RUF); the latter, in turn, created a system of slave labor to harvest the stones. Taylor derived his income not only from diamonds, but also from timber and arms. However, while the other commodities were lucrative, and extended Taylor's regional influence, according to Farah it was Taylor's control over the diamond trade that allowed Taylor to organize an intricate organized crime network, and to attract the interest from various international criminals, including Al Qaeda.

Farah's book details Al Qaeda's extensive interests in diamonds and other precious gems as an undetectable and untraceable means of moving and storing money. Radical Islamist and close associate of Taylor, Ibrahim Ba, was the gatekeeper to diamonds for the Al Qaeda terrorist network. According to Farah, Ba fought alongside future Al Qaeda operatives, and became one of Taylor's middlemen, receiving a 10 – 15% premium on diamonds sold. Taylor and his inner circle made millions of dollars while indirectly financing terrorists responsible for the 9/11 attacks, Farah continued. However, he noted, Taylor and his associates did not discriminate in their illicit transactions. Farah called Taylor's Liberia "a Disneyland for criminals," where Israeli organized crime figures supplied weapons to Hezbollah arms dealers, ex-Soviet planes could deliver merchandise anywhere in the world, and everyone would be protected by Liberia's status as a sovereign nation.

Taylor's Liberia was especially useful to Al Qaeda in the run-up to the September 11th attacks. After the Nairobi and Dar-es-Salaam embassy bombings in 1998, President Clinton moved quickly to freeze Al Qaeda bank accounts all around the world. These seizures taught Al Qaeda a tough lesson, and it sought to avoid similar economic repercussions after the September 11th attacks. As a result, according to Farah, they moved their assets out of the formal sector altogether, storing the money in untraceable commodities all around the world, including gold, tanzanite, and diamonds. In Liberia, they found that diamonds were particularly accessible, and very affordable. As a result, Al Qaeda operatives purchased nearly all of Charles Taylor's diamonds in the autumn of 2001 at prices well above market value, triggering massive shortages and consternation among rival buyers.

During the discussion that followed, attention was centered on the shortcomings of the intelligence community described in Farah's book and the measures that should be taken to effectively monitor or prevent terror financing. Farah said that the failures of US intelligence were due to an absence of officers in Africa monitoring the situation on the ground. Regulatory approaches to the diamond industry, according to Farah, are not the way to cut off terror financing. Such approaches may hurt small businesses without ever reaching the core of the vast international illegal diamond trade. Given Al-Qaeda's relatively small share of this multi-billion dollar diamond industry, isolating the diamonds linked to Al-Qaeda would be like "searching for a needle in a haystack made of needles." What is required is deeper dialogue with diamond dealers on the structure of the network and better human intelligence on the transactions occurring within the diamond network. In Farah's view, presently US intelligence is too heavily dependent on technological means of data collection.

Nicole Rumeau, Africa Program Associate, ext. 4097
Howard Wolpe, Director