Storm Track Infiltration: Illegal Knock-off Funding Terrorism

The financial jihad continues. The Islamists are always looking for ways to fund their jihad. This time it’s through Paraguay. Hat tip to Debra.

The Tri-Border is the home of the largest illicit economy in the Western Hemisphere, and the specialty is financial crime. Counterfeiting, intellectual property fraud, trademark fraud, money laundering and smuggling add up to an estimated $12 billion a year in illegal trade in Ciudad del Este.

Illegal knock-offs for almost every conceivable product can be found in every store on every street. It's been a part of Paraguay's troubled economic history for decades.

McCabe Associates, has investigators all over Latin America, tapping people from the FBI, CIA, DEA, U.S. Customs, the U.S. military and several prosecutors' offices. In the last ten years, McCabe's investigations have led to the seizure of more than $100 million worth of counterfeit goods.

On a good day, McCabe's teams confiscate tens of thousands of dollars worth of pirated goods — hundreds of boxes brimming with everything from illegal software to counterfeit cell phone batteries, electronics, Barbies, illegal drugs.

Almost any product you can think of has an illegal knock-off available in this city. And every day, millions of these goods make their way across the border from Paraguay into the Brazilian and Argentinian marketplace.

Even with state officials watching, sneaking the counterfeits through customs is far from difficult. For example, a whopping 25,000 people a day cross just a single bridge into Brazil, making it easy for the local locals — who are expert at moving the illegal products — to smuggle even in broad daylight. Even more troubling though, is the destination for much of the earnings from this illicit economy: terrorist financing.

Some 25,000 Lebanese nationals live in the Tri-Border. American officials say Middle East terror groups like Hamas, Islamic Jihad and Hezbollah are receiving huge amounts of money from the region's illegal activities. So much that it has become a very important source of terrorist support. How important? "It’s critically important from the standpoint of consistency," said Dennis Lormel, an investigator with the Federal Bureau of Investigation. "The tri-border area is probably the most lucrative area for Hezbollah outside of the state sponsors."

The situation has drawn the attention of Manhattan District Attorney Robert Morgenthau, who says hundreds of millions of dollars coming out of the region is being laundered through New York banks. "Between $50 million to $500 million goes to Hamas and Hezbollah," Morgenthau said. "On a quiet day, $4 trillion goes through New York, so it's relatively easy to hide a million or a billion dollars when you have this huge flow of money."

And where are the democrats on this one? Oh yeah. They’ll blame it on the Bush and his greedy administration.

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