TERROR-FUND COUNTERMEASURES RIPPED

The independent commission investigating the Sept. 11 attacks said the
U.S. government hasn't made much progress in figuring out how al Qaeda
gets its financing.

In the three years since Sept. 11, "the U.S. government still hasn't
determined with any precision how much al Qaeda raises or from whom,
or how it spends its money," the commission said in a report released
Saturday. While the Saudi Arabian government became fully engaged on
the issue last year, the commission added, it's unclear whether it
will sustain its efforts and whether the U.S. has the political will
to pressure Saudi Arabia to do so.

In addition, "efforts within the financial industry to create
financial profiles of terrorist cells and terrorist fundraisers have
proved unsuccessful, and the ability of financial institutions to
detect terrorist financing remains limited," according to the panel.

The new report is meant to be the commission's definitive statement on
terror funding -- an issue the panel touched on only lightly in its
landmark report last month on the attacks and the government's efforts
to fight terrorism. For the most part, the report doesn't offer new
analysis or information on specific sources of terror funding;
instead, it offers many chapters in the history of efforts to deal
with the problem.

The report undermines Bush administration claims of success in the
fight against funding for terrorism. It documents the collapse of one
pivotal case for lack of evidence, and asserted that two other cases
were legal victories but public-relations losses because, while
financiers were put out of business, no one was convicted of a
terrorism offense. Overall, its depiction of governmental ignorance of
terror-funding methods and inability to stop terrorist penetration of
the financial system is at odds with the administration's portrait of
victories in the war against terror funding.

The 9/11 Commission apportions blame equally between the U.S. and the
Saudis. The Federal Bureau of Investigation and the Central
Intelligence Agency come in for tough criticism as uncooperative
bureaucracies. The CIA has improved its efforts, and the FBI is also
doing better, but its analytical output is still weak, the report
said. "As of spring 2004, the FBI has generated very little quality
finished intelligence in the area of al Qaeda financing," the panel
reported.

Most of al Qaeda's money comes from wealthy individual donors in the
Persian Gulf and corrupt Islamic charities, the panel said, but much
work still needs to be done to identify specific sources. The group
doesn't deal drugs or engage in stock-market manipulation, the panel
said, and evidence it uses diamonds to raise money "has not been
substantiated." The panel reiterated its finding that the Saudi
government has never supported al Qaeda.

In contrast to their historical lack of cooperation, the Justice
Department and the FBI are now working very closely to develop
criminal cases, the panel said.

Those efforts bore fruit last week with the indictment of three
alleged top operatives in the Palestinian group Hamas on charges of
financing terrorism. Among those charged is Mousa Abu Marzook, a Hamas
leader believed to be living in Damascus, Syria. The indictment offers
a wealth of new evidence against Mr. Marzook, who for many years
traveled the U.S. organizing and funding fundamentalist groups. In an
interview with the Associated Press, Mr. Marzouk denied the
allegations.

The indictment relies on information provided by several uncharged
associates of the three men, suggesting that investigators may have
finally succeeded in penetrating Hamas. It describes the alleged
movement of more than $2 million through various accounts in the U.S.,
Europe and the Middle East to pay for recruitment, organizing and
terrorist attacks.