Terrorist Financing: Kidnapping, Antiquities Trafficking, and Private Donations

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Chairman Poe, Ranking Member Keating, and distinguished Members of the Subcommittee, thank you on behalf of the Foundation for Defense of Democracies’ Center on Sanctions and Illicit Finance for the chance to testify before you today.

As a think tank analyst who focuses on the Arab Gulf monarchies, I have concluded that several of America’s allies in the Middle East – namely, Qatar, Turkey, Kuwait, and Saudi Arabia – are best characterized as America’s frenemies on the issue of terror finance: important partners on some issues that pursue problematic or adversarial positions over terror finance emanating from their territories. As such, I will devote a significant portion of my testimony today to documenting these countries’ negligence on combating private terror finance and recommending steps that Washington can take to highlight and disincentivize such harmful conduct.

However, because we are joined by Diane Foley here today, I would first like to take the opportunity to seriously grapple with the challenge posed to American interests by the problem of non-state terrorists who increasingly use kidnapping for ransom to fund their violent activities.

The toll that kidnapping takes on victims, families, employers, and their communities is immense. Perhaps because the magnitude of this toll is so difficult for the rest of us to fully comprehend, I believe that there is a tendency for policymakers to be somewhat callous or even Pollyannaish by presuming that this problem can be addressed without a serious new investment of resources and rethinking of U.S. policies in this issue area. And all this must be done without letting the heinous crimes of terrorists exert control over our decisions by forcing under- or over-reactions in American foreign policy.

I believe that the Obama administration’s new policies for addressing hostage issues are a big step in the right direction that should be applauded. However, they fall short in one critical area by failing to articulate a coherent and viable new strategy to deter foreign governments, in both Europe and the Gulf, from allegedly continuing to pay direct or indirect state ransoms to terrorists on a massive scale.

I believe I witnessed a starker version of such wishful thinking as a one-time staffer on this Committee. I watched with astonishment as my boss and mentor, the late Chairman Tom Lantos (D, CA), put his arm around the wife of an Israeli soldier kidnapped by Hezbollah and inaccurately promised her that America would help bring her husband home alive. Sadly, we later learned that her husband had already passed away, having succumbed to wounds incurred when he was captured.

Rather than letting ourselves be blinded by optimism or idealism, we must recognize that U.S. policy today is failing to deter our own allies from fueling the terrorist threat by irresponsibly rewarding kidnapping for ransom at a state level.

Finally, while this hearing will also focus on the terror finance challenge of antiquities trafficking by violent groups such as the Islamic State (IS), I will defer to the other witnesses in this regard. I would also like to note that FDD’s Center on Sanctions and Illicit Finance has a forthcoming comprehensive report in which coauthors Yaya Fanusie and Alex Joffe analyze the strategic role of antiquities trafficking in financing the Islamic State.