EDITORIAL - Cutting off terror financing

Filipinos worried about the terrorist threat welcome reports that the Philippines and Saudi Arabia are strengthening cooperation to stop the flow of terror funds from the Middle East to Koranic schools that teach radical forms of Islam in this country. The move comes on the heels of Washington’s identification of the Philippine and Indonesian branch offices of a Saudi-based Islamic charity as conduits for terror financing. The US Treasury Department said in August that the International Islamic Relief Organization helped al-Qaeda and other terrorist groups raise funds, with one of the IIRO’s top officials giving cash directly to al-Qaeda, Jemaah Islamiyah and the Abu Sayyaf.

Security officials said anti-money laundering teams from the Philippines and Saudi Arabia are discussing the details of the enhanced cooperation. One problem is that this effort may not cover the shift by terrorist organizations to the use of financial couriers to bypass the global banking system. Banking rules against money laundering have progressively tightened since the terror attacks in the United States on Sept. 11, 2001. This can be a big problem particularly in countries such as the Philippines, which has a large number of citizens working overseas, many of them in the Middle East.

Another problem, at least in dealing with Koranic schools and Islamic charities, is how the Saudis define radical Islam. With its vast pool of petrodollars, Saudi Arabia has spread its ultra-conservative Wahhabi brand of Islam worldwide. Security analysts believe that Islamic fundamentalism has helped fuel radicalism in certain parts of the Muslim world.

Saudi Arabia itself has suffered from the terror threat, and its efforts to fight the spread of terrorism are laudable. The regime in Saudi Arabia emphasizes that the state does not sponsor terrorism. But it will have to exercise more prudence in dispensing assistance to Islamic groups around the world. Its huge reserve of funds for charity can be used to promote a non-violent, tolerant Islam, which peace-loving Muslims say is the true nature of their faith. A closer look at radical Islamic schools is a step in the right direction.