Al Taqwa Bank - U.S. and Swiss Investigations

U.S. and Swiss Investigations

In 2002, the United States Treasury Department contacted the Swiss government by letter in an effort to convince authorities that Al Taqwa Bank had set up a special line of credit for Al Qaeda financial kingpin Mamdouh Mahmoud Salim to finance terrorist attacks by various terrorist organizations, including Al Qaeda and Hamas. The communique stated that Al Taqwa Bank used secret accounts, convoluted real estate transactions, and other financial methods of obscuring the flow of money to funnel cash directly to organizations that would use the funds for terrorist attacks. Money would allegedly flow from Kuwait and the UAE into Al Taqwa offices in Lugano and Malta, where Al Taqwa provided "indirect investment services for Al Qaeda, investing funds for bin Laden, and making cash deliveries on request to the Al Qaeda organization."

These letters were intended to convince the Swiss to take legal action against banking operations the U.S. government considered suspect (Youssef Nada was himself based in Switzerland). These appeals had apparently been going on since the mid-1990s; Swiss banking officials knew of the reports of Al Taqwa Bank's connections to terrorism, but did not have the evidence to take official action, due to Switzerland's strict banking-secrecy laws and the lack of transparency inherent in Islamic hawala banking.

This drama played out largely away from public scrutiny. However, in 2002 the semi-secret intergovernmental letters were obtained by an American lawyer involved in a class-action suit against supposed terrorist financiers and subsequently entered into the public record.