Interpol Links Piracy To Terrorism Funding

There is new evidence that terrorist organizations around the world are getting at least some of their funding from the sale of illegally copied intellectual property, including pirated DVDs and CDs, according to Interpol and copyright trade groups.

According to an Interpol report prepared for the House Committee on International Relations, intellectual property crimes are a growing resource for terrorist groups from Northern Ireland to the Arab world, including al-Qaida and Hizbullah, and the RIAA has evidence that a pair of illegal CD plants in Pakistan is financed by Dawood Ibrahim, an Indian Muslim the Treasury Department named a "specially designated global terrorist" in October.

"This designation signals our commitment to identifying and attacking the financial ties between the criminal underworld and terrorism," said Juan Zarate, deputy assistant secretary for terrorist financing and financial crimes at the time.

"We are calling on the international community to stop the flow of dirty money that kills. For the Ibrahim syndicate, the business of terrorism forms part of their larger criminal enterprise, which must be dismantled," he said.

Ibrahim has found common cause with al-Qaida, sharing his smuggling routes with the terrorist network and funding attacks by Islamic extremists aimed at destabilizing the Indian government, according to the State Department.

He is wanted in India for the 1993 Bombay Exchange bombings and is known to have financed the activities of Lashkar-e-Tayyiba (Army of the Righteous), a group the United States designated as a foreign terrorist organization in October 2001. The Pakistani government banned the group and froze its assets in January 2002.

While intellectual property theft is not confined to entertainment products, it appears to be a funding source that terrorist groups are willing to exploit. Copyright piracy is estimated to cost U.S. companies $20 billion-$22 billion a year.

"In July 2003 Interpol concluded that the link between organized crime and counterfeit goods was well established and sounded the alarm that [intellectual property crime] was becoming the preferred method of funding for a number of terrorist groups," according to the April 6 report prepared by Interpol Secretary-General Ronald Noble. "Developments since then have reinforced this view, and the following example illustrates how these activities continue to be a cause for concern."

Interpol's report lays out a number of scenarios, but it described one of the operations like this:

"Funds generated from (intellectual property crimes) may be remitted to Hizbullah using the following modus operandi. Counterfeit goods produced in Europe