LTTE Fundraising & Money
Transfer Operations
Prepared based on paper
by Shanaka Jayasekara
( Shanaka Jayasekara who is
a Research Assistant at the Centre for Policing, Intelligence and Counter
Terrorism (PICT Macquarie University, Sydney, Australia. This Paper
on " LTTE Fundraising & Money Transfer Operations " was
Presented at the International Conference on Countering Terrorism held
in Colombo, 18 - 20 October 2007.
http://www.kadirgamarinstitute.lk/html/pdf/Terrorist%20Fund%20Raising_Shanaka%20Jayasekara.pdf
1. Introduction:
Operations of the international network of the LTTE used as a case study
on terrorist financing.
Two Main Focus of this article:
Part I) A four-tiered progression methods used by groups for resource
mobilization (methods of fundraising and assess the progression of such
methods in terms of institutionalization and sophistication). LTTE has
an active domestic fundraising operation but this study concentrate
on International arm;
Part II) Processes (illusive network of financial nodes and controllers)
by which such funds are moved for procurement activity (specifically
identify the processes of fund transfer used by the LTTE for weapons
procurement)
2. Structure of the LTTE International Network
LTTE presence over 44 countries out of which structured presence in
12 Top Level Contributing - TLC) countries & each country has designated
a country representative. Managed by international co-ordination centre
in Kilinochchi & its decisions are disseminates through the Tamil
Coordinating Committee (TCC) in the respective country.
2.1 The country-level structure:
" Staffed mainly by ex-combatants or siblings/relatives of key
Vanni leaders;
2.1.1 E.g. German Hierarchy
" Political unit tends to provide the overt representation of LTTE
propaganda, while at the same time setting the stage for active community
mobilization to facilitate fundraising activities.
" Finance unit is responsible for achieving the collection targets
set by Killinochchi for each country. The dynamism of the Finance unit
is relative to the sophistication, pattern of investments and the level
of institutionalization of fundraising processes in that country
" Procurement unit tends to operate outside the direct supervision
of the country representative, but has a parasitic relationship with
the LTTE infrastructure in each host country.
" This study will expand on the operations of the Intelligence
unit in host countries in the second part of the paper.
2.1.2. Switzerland (almost similar to above)
" Country representative, Kulam;
" Political unit: Head - Arulsothy, 3 regional leaders, Anbalawannan
(Bern), N Kumar (Zurich) Sivaneshan (Fribourg);
" The Finance unit: Head - Suda. Last 5 Yrs collections in Switzerland
has topped LTTE collections worldwide;
" Procurement Unit and an Intelligence Unit.
3. Fundraising Methods:
In an effort to examine and analyses the processes of terrorist fundraising,
the study will categorize such fundraising methods into 4 stages of
progression. In most cases the LTTE uses a combination of methods relative
to the size of the Tamil Diaspora and other externalities that influence
fundraising activity.
3.1 First (1st) Generation Fundraising Methods:
" 3.1.1. Collections from Individuals/Business
o Unstructured or loosely structured community based activity;
o Methods of collection range from personal compulsions, to methods
of passive and aggressive coercion and extortion.
" 3.1.2. Event Based Fundraising
o Lately, fundraising is a regimented calendar of fundraising appeals
formulated after the leadership of the LTTE international coordinating
Office was tasked to Veerakathy Manivannam (Castro) and former deputy
Sivapalasuntheram Gnanaseelan (Kalaiyalagam).
o The calendar of the event also reinforces the dominant role of the
LTTE within Tamil Diaspora affairs.
o E.g. Recently in Sydney, a Burwood based Tamil radio station is alleged
to have collected over AUD 100,000 by conducting a marathon radio appeal
for a blood bank in Kilinochchi.
o These events based on commemoration of combatants and military operations,
cultural shows, sports events, food festivals and guest speaker events.
o At the time LTTE peace delegations toured Europe, a dinner was organized
at which donations ranging up to SFR 20,000 were demanded from each
businessman.
o Tamil Youth Organization (TYO with branches in 09 countries), which
seems to be taking the lead role in event based fundraising and mobilizing
Tamil youth in keeping with the LTTE agenda.
" 3.1.3. Narcotics Trafficking and Criminal Activity
o LTTE engagement in narcotics trade and the ensuing gang violence had
a lasting impact & the gangs infused a culture of violence into
the fabric of Tamil Diaspora societies.
o Mackenzie Institute in Canada, describes the use of LTTE shipping
fleet based in Myanmar to ship narcotics to Tamil gangs in Toronto.
o In addition to narcotics trafficking, international network has provided
sponsorship to organized criminal activities such as credit card cloning
and human smuggling.
3.2 Second (2nd) Generation Fundraising Methods:
" 3.2.1. Use of (humanitarian) Front Organizations
o These methods are more institutionalized and tend to subvert the domestic
legal regimes in the host countries.
o These front organizations have a dual function; humanitarian activity
with much publicity and also act as a channel for LTTE fundraising.
o After British Charity Commission de-listed Tamil Rehabilitation Organization
(TRO (UK)) as a charitable organization, 2 new organizations were established,
International TRO (ITRO) and Tamil Support Foundation (TSF) to continue
similar operations.
o TRO (US) head, Dr Nagarathnam Ranjithan's private residence was raided
by the FBI in Aug. 2006;
o The International Coordinator of the TRO, Dr Jay Maheswaran, represented
the LTTE at the first round of peace talks in September 2002.
o Former head of the LTTE international secretariat Lawrence Thilagar
functions as the Program Officer for TRO in Kilinochchi.
o An organization of Tamil doctors in the US, the International Medical
Health Organization (IMHO) (formerly known as the Tamil Health Organization
- USA), provides financial and material support to a partner organization
known as the Centre for Health Care (CHC) in Kilinochchi. (Affiliation
of LTTE - see evidence in the original article)
o An examination of the 2003 financial statement provided by the Tamil
Coordinating Committee (TCC) in Melbourne to the Victorian Consumer
Affairs Department indicated a substantial part of the income was transferred
to a front organization in Malaysia for suspected weapons procurement.
" 3.2.2. Distribution of Tamil DVDs
o The LTTE provides tacit protection against piracy of movies released
by selected distributors, which is a mutually beneficial business arrangement
for both the distributor and the LTTE.
" Return on Investments - Business Ventures
o The Finance units in host countries provide seed-capital to close
associates of the leadership.
o These ventures provide LTTE the opportunities for money laundering,
employment for activists and interaction with the community.
" Mother Tongue School
" Informal Remittance Systems
o The LTTE has developed a robust informal remittance system referred
to as the "Undi" system (Hawala) & The Tamil Diaspora
can transfer money to relatives in Sri Lanka;
o A significant component of money transactions within the Undi system
facilitates the falsely declared import of gold jewellery into Europe
from the Gold Market in Singapore for the jewellery market. The LTTE
Finance unit in Switzerland has been actively facilitating the money
transfer using human couriers between Switzerland and Singapore.
3.3 Third (3rd) Generation Fundraising Methods:
" 3.3.1. Pre-paid Phone Cards
o The retailing of international call-time using phone cards is one
of the most profitable business ventures associated with LTTE fundraising;
o The LTTE provided seed capital to set up several front companies registered
as telecom retailers in Europe. Purchase bulk call-time to Asian destinations
from gateway operators in Europe and retail the call-time using phone
cards under multiple brand names.
" 3.3.2. Management of Hindu Temples
o Benefits of charitable status and funds with minimum paper trail;
o Several cases recorded in the UK, Canada and Australia in which strong-arm
tactics were used to gain control of temple management;
o The Human Right Watch report cases in Canada and Australia (Perth)
in which the LTTE used violent methods to intimidate temple owners;
o The Trustee of the Amman Hindu temple in Paris Vinyagamoorthy was
arrested in October 2006 at the French-Swiss border attempting to courier
Euros 18 million in currency allegedly for the LTTE.
" 3.3.3. Subscription Satellite Television
o An active media strategy, which includes the aggressive use of the
Internet, community based Tamil radio stations and subscription satellite
TV.
o Use of satellite TV provides the LTTE with a single most effective
medium to inform the large Diaspora.
o The Tamil Television Network (TTN) a subscription satellite TV provided
Tamil entertainment to the Diaspora infused with LTTE undertones. It
also provided news from Kilinochchi with re-broadcast of NTT (National
Television of Tamil Eelam) news segments.
o A new satellite TV that commenced operations in January 2007 from
Australia plans to replace the lucrative TTN operation.
o In Europe, Tamil businessmen are required to maintain a specified
advertising commitment with such satellite TV channels. The TV channels
charged excessive premiums for such advertisements.
3.4 Fourth (4th) Generation Fundraising Methods:
" 3.4.1. Fixed Income Generation Methods - Registration of the
Tamil Diaspora
o All Tamil families in Europe are being systematically registered and
assigned a Unique PIN number (Tamil Eelam identity number).
o Information collecting form consists of 30 questions relating to personal
information including details of blood-relatives in Sri Lanka, income
status, subscription to LTTE satellite television and contribution to
homeland funds.
o Intends to use this information to make assessments on contributions
levels based income and lifestyle factors.
o The base rate under this system seems to be one unit of currency (one
Euro in Europe) per person for each day out of Sri Lanka. Additional
surcharge is applied depending on income levels, size of family and
contributions towards periodic appeals.
o In an article published in the French newspaper LeFigaro, on 2 December
2005, a French citizen of Tamil origin describes how the LTTE accessed
all his personal details at the LTTE check point in Sri Lanka with his
PIN number and confiscated his French passport until his family agreed
to pay the outstanding contributions owed in France.
PART II - Finance Network of the LTTE
1. Modalities to Relocate, Hold and Transfer Funds
" Purpose: weapons procurement and other logistics support;
" LTTE financial network is the Aiyanna Group, which is involved
in intelligence work, and it is seeking a greater role in international
procurement operations in what was earlier a more closed-group.
" While Aiyanna Group is believed to have close links with the
intelligence units of the LTTE, the level of involvement in the financial
transfer processes is unclear at this stage.
2. The Sana Group
" Has one Principal Controller and 08 trust-managers located in
Europe, North America and South East Asia. Identity of the Trust managers
not disclosed (each other).
" The funds apportioned for procurement purposes are relocated
to designated trust-managers and held in safe locations.
" These transfer take place using several mediums such as, bank
transfers, human cash couriers and over invoicing import-export transactions.
" The trust-managers place the funds in multiple forms of investment
to avoid detection by regulatory authorities. These managers regularly
update the Principal Controller of the financial status and liquidity
of assets.
" Sana Group is the Principal Controller (based in a European country)
the hub of the network and maintains an inconspicuous profile (no funds
are held by the Controller.);
" Controller maintains is a multiplicity of records (financial
portfolios) received from each trust-manager on the current availability
of financial resources and the level of liquidity of assets.
" When the LTTE procurement teams have to meet financial commitments
Kilinochchi inform to make available sufficient appropriations, the
Controller depending on asset distribution and liquidity will inform
one or more trust-managers to transfer funds;
" The funds will be transferred to multiple locations in non-detectable
blocks. At this point members of the procurement team would consolidate
the multiple receipts, most often in a south East Asian country;
" An Example: FBI sting operation in Guam. The LTTE sent a three-man
team headed by Varatharasa to Guam Island on 26 September 2006. After
inspecting a consignment of weapons presented by undercover FBI agents,
the team consolidated the advance payment in Malaysia and transferred
US $ 452,000 to a Baltimore bank account.
3. Conclusion:
" The LTTE has developed the most sophisticated infrastructure
for fundraising and money transfer operations in comparison to any other
terrorist group;
" It gives the LTTE the advantage of stability in projected incomes
and procurement planning.
" Ability of international network to evade detection and maintain
flow of funds;
" Could be replicated by other terrorist and criminal groups.
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