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Homeland Security

Statement of Susan M. Collins

Senate Committee on Governmental Affairs

"Terrorism Financing: Origination, Organization, and Prevention"

July, 31 2003

Today, the Committee on Governmental Affairs is holding a hearing on the financing of terrorism. Terrorism costs money. From funds needed to buy explosives and plane tickets, to living expenses, to pay-offs to families of suicide bombers, terrorists must have constant and untraceable sources of money. Stopping the flow of these funds is a formidable task. Osama bin Laden is an experienced financier who has reportedly boasted that he and other Al Qaeda leaders know the cracks in the Western financial system like the lines on their own hands.

Immediately after the September 11 attacks, the President took strong action to close the gaps in our financial system by issuing Executive Order 13224 to block terrorist funds. Nevertheless, serious questions remain about whether we are doing enough. There are even more serious questions about whether some of our allies are doing enough.

Last year, the Council on Foreign Relations issued a report contending that U.S. efforts to curtail terrorism financing are impeded, and I quote, "not only by a lack of institutional capacity abroad, but by a lack of political will among U.S. allies." The report concludes that our government appears to have responded to this lack of will with a policy decision not to use the full power of our influence and legal authority to compel greater cooperation.

A key nation in the fight against terrorist financing is Saudi Arabia. It appears that the Joint Inquiry by the House and Senate intelligence committees examined the Kingdom's role in terrorist financing, but it's difficult to tell for certain, as almost the entire chapter regarding foreign support for the September 11th hijackers is classified. Even the parts that were published, however, raise serious concerns about Saudi Arabia's role in the September 11th attacks.

For example, the unclassified portion of the Joint Inquiry report describes the activities of Omar al-Bayoumi, a man who apparently provided extensive assistance to two of the September 11th hijackers. According to the report, a source told the FBI that he thought al-Bayoumi must have been an intelligence officer for Saudi Arabia or another foreign power. The report also finds that al-Bayoumi had access to "seemingly unlimited funding from Saudi Arabia." Mr. al-Bayoumi is now reported to be living in Saudi Arabia.

Last month, the General Counsel of the Treasury Department testified before the Terrorism Subcommittee of the Judiciary Committee, that in many cases, Saudi Arabia is the "epicenter" of terrorist financing. The Council on Foreign Relations report found that, for years, individuals and charities based in Saudi Arabia have been "the most important source of funds for Al Qaeda; and for years, Saudi officials have turned a blind eye to the problem." As our witnesses Ambassador Dore Gold and Steven Emerson will describe in detail, there is evidence that enormous sums of money flow from Saudi individuals and organizations to Al Qaeda, Hamas, and other terrorist organizations.

The key question now is whether the Saudi government is doing enough to stop the flow of this money, and if not, what actions the U.S. government should take to prompt the Saudis to take effective action. The Saudi government recently announced some changes to its banking system and charity laws, but it is not clear that these changes go far enough.

We are fortunate to have with us today key counterterrorism officials from the FBI and Department of Treasury. They will describe the Administration's actions against terrorism financing, and they will discuss the level of cooperation our country is receiving from the Saudi government. We also have three experts to discuss their views regarding the fight against terrorist financing generally, and Saudi Arabia's role specifically.

As the discussion of the Joint Inquiry's report has made clear, there are still many questions about Saudi Arabia's role, even if inadvertent, in the September 11th attacks, and about the extent of the Saudi government's cooperation in the fight against terrorism. I hope today's hearing can help answer some of these questions and highlight some of the areas where our government needs to focus its efforts in order to stop the flow of funds to terrorists.

I am pleased today to pass the gavel to Senator Specter, who spearheaded this hearing and is one of the Senate's leaders in the war against terrorism. He has served as Chairman of the Senate Intelligence Committee, he chaired a hearing about this subject last November in the Judiciary Committee, and he has continued to investigate this matter as a member of the Judiciary and Governmental Affairs Committees. The hearing today is particularly timely, given the release last week of the Joint Inquiry report on the September 11 attacks. I applaud Senator Specter for his efforts, and am pleased to work with him on a subject that has such a profound impact on the safety of our country and all law-abiding nations.

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