Blood Profits

by Vanessa Neumann

  9

  Bad Sport

  THE QUIET AUSTRALIAN

  The twelve-month period from the summer of 2014 to the summer of 2015 tested my mettle as a businesswoman. I fell in love, came face-to-face with real bad guys in a whole new crime-terror pipeline involving Islamists in the free trade zone in Panama, learned all about yet another form of corruption and money laundering (in sports and online gambling), and had to part ways with my partners in Asymmetrica.

  This next level of adventure started in June 2014. Some members of the OECD’s Task Force on Charting Illicit Trade were beckoned to task force chairman David Luna’s office in a satellite building of the State Department for a briefing with a senior member of the Office of the Director of National Intelligence. I was one of them. So was Chris Howard.1

  He sat across the table from me, next to his International Centre for Sport Security colleague Fred Lord—his friend, Australian compatriot, and polar opposite. While Fred is slim, swarthy, chatty, and long-haired, with tie askew and the permanent demeanor of one who has only just barely escaped some harrowing situation, Chris is broad, pale, taciturn, impeccably attired, and chillingly self-possessed. He watches.

  I didn’t realize then that he was watching me, in my favorite slim-cut emerald-green trouser suit, about which he would later tease me endlessly. He seemed nice enough (the little that he spoke) when, at the end of the meeting, we exchanged a few pleasantries about his plans that evening. He gave some vague answer about hitting the town and getting some drinks. Vague, brief answers, I was later to learn, are his default. I was going to Virginia to visit my retired horse, and then one of my new business partners and I were going to shoot targets with a Glock, an AR-15, and an M-4. I had no inkling of the role the quiet Australian would play.

  PANAMA: “YOU ARE NOT WHO YOU SAY YOU ARE”

  On July 13, 2014, I received an email from a Washington, D.C., friend introducing me to “Bill,” saying Bill had a project for me for which he thought I would be well suited. I routinely get requests to find out who is really behind a business transaction or where a network is getting its support: how the money and goods flow, who is connected to whom and how—particularly if the networks connect Latin America to the Middle East or Africa. We turn down clients we think are dirty or “on the wrong side.” In a follow-on email later that day, with a link to some of his work, Bill explained what he wanted: for three to four days of in-country work researching Islamism in Panama, he needed a fluent Spanish speaker; the work would be time sensitive and there would be limited funding for about ten days’ worth of work.

  I said that given my past (and well-publicized) work on Hezbollah in Latin America, I might be interested in the expansion of my regional knowledge.

  In a follow-on email, Bill explained the terms. The money was minimal, for a four-thousand-word report that would be published in Arabic in a forthcoming edition of the “monthly book” of a Persian Gulf think tank that would focus on Islamist movements in South and Central America. The think tank had a growing following in the region and a liberal, pro-Western leadership, and would host a forthcoming conference in Dubai, “for which there will also be compensation, as well as an opportunity to connect with some remarkable people.”

  Three days later, I flew into Panama. Numerous flight delays made me thirty minutes late for my first meeting, with a liaison who knew the organized crime and terrorist landscape quite well. We met in the lobby of the Waldorf-Astoria Hotel, where other members of what she referred to as her “team” sat in the background as we chatted. She was very warm and friendly, and I gave her a brief backgrounder on how I came to do this work, on Asymmetrica, and on what I was seeking in Panama. She hoped we could establish a long-standing relationship that would be mutually beneficial.

  My liaison asked whether I had noticed upon arriving how at the Panama airport the arriving passengers mix with the transit passengers, making Panama an ideal transit point for anyone who wishes to hide. Overall she stressed that Panama is a place that is growing economically, so the government has little will to offer greater transparency because it is economically beneficial not to look too deeply into illicit trade or money laundering.

  This was two years before the Panama Papers scandal, but money laundering had gained political importance in the two weeks since the new administration had been sworn in: Panama had just been placed on the gray list of the Financial Action Task Force (FATF, a financial policymaking and monitoring organization that sits inside the Paris headquarters of the OECD), based on an International Monetary Fund report chronicling the country’s lack of financial transparency.

  The consequence of being gray-listed was that now everyone doing business through Panama would have their books more closely examined, and, more important, the price of borrowing money for the country’s sovereign debt was higher—being gray-listed flags a country as risky. As anyone who has ever applied for a loan knows, the riskier a client you are, the higher the interest rate on the loan. So this lack of transparency carried a heavy financial cost for the country.

  Two of the main problems with illicit trade and corruption are the disconnection and the asymmetry between those who profit and those who pay the costs. While facilitators (like the law firm Mossack Fonseca, which gained notoriety in the Panama Papers) make fees for hiding money, the cost of stolen money (whether in higher interest rates or crumbling infrastructure) are borne by residents, who have no share in the profit. The profits are funneled into the hands of a few, while the costs are spread out among the populace. It takes a lot of stealing to get the populace to feel enough pain that they are motivated to rebel, so corruption can exist in a country for a long time.

  Panama, my liaison said, is a remarkably small place where everybody knows everybody else and everybody is a consultant. I told her that my next meeting was with a lawyer who was a former narcotics prosecutor; she asked whether it was “Roberto,” and I confirmed that it was. She said the talk around town was that Roberto had offered his consulting services to the American Embassy, but was turned down because it was unclear what his area of specialty was and he had done nothing official in some time, so his information was not current. (Nearly everyone in Panama is a “licensiado,” the title used to designate a lawyer, because the law degree requires only four years of undergraduate study, but most function as consultants or managers of shell companies.) By the end of the meeting, I had two starting points for my research into Islamism in Panama: the mosque in El Chorrillo and the free trade zone in Colón.

  Unusually for a Latin American, Roberto arrived bang on time and suggested we find another place to have dinner that would be more fun and jovial. Assessing the risk, I got into his car and he drove me to another part of town with a view of the water, and we had dinner at a very casual place with live music, the El Ranchito restaurant. Dinner consisted of fish and a couple of beers, which we consumed as the band played, silhouetted against a moonlit sea.

  Roberto offered no insight of value but was offering instead his professional services for any clients that we might have with local business, saying his particular area of expertise was investigations into shell companies and money laundering. I said that that sounded like a great idea, that I had no doubt we would be doing business together, and that I would let him know as soon as we could use his services—which I knew we would not. Exhausted from many hours of travel after only three hours of sleep, I asked him to take me to my hotel.

  The following day I met with “Eduardo,” who had been until two weeks earlier a very high-ranking intelligence officer for the Panamanian government. Unlike Roberto, Eduardo was a fountain of information. He talked about Palestinians in Chiriquí, on the border with Costa Rica, as well as about the many Lebanese in the Colón free trade zone, who were of all stripes, including Sunni Muslims and Maronite Christians, some of them angry that the US Embassy had been canceling their visas.

  He also spoke of Nidal Waked, a Spanish, Lebanese, and Colombian national who ow
ned two newspapers (La Estrella and El Siglo), an import-export business called La Riviera, the duty-free zone at the Panama airport, and his own bank, Balboa Bank & Trust. His business was the second largest in the Colón free trade zone, and he was investigated in the 1980s by the Americans for money laundering. In May 2016, almost two years after this conversation, Nidal Waked was arrested by the DEA at the airport in Bogotá, Colombia, as one of the world’s biggest drug lords. The US Treasury Department said Waked’s family-run operation “uses trade-based money laundering schemes, such as false commercial invoicing; bulk cash smuggling; and other money laundering methods, to launder drug proceeds on behalf of multiple international drug traffickers and their organizations.”2

  Eduardo said the Arabs are viewed very positively by the local population in the Colón free trade zone, because they help the poor with food and jobs. He spoke also of his long friendship with Fernando Núñez Fabrega, the former foreign minister of Panama. He said China is the biggest provider of goods entering the free trade zone, followed by Taiwan.

  Eduardo talked about two operatives of the Iranian Revolutionary Guard Corps who had set up an office in Managua, Nicaragua, then came to Colón and met with the Arab community there, requesting more money from their charities. When I pressed as to names and dates, Eduardo was vague: he said it had happened over the last couple of years and he could not recall the names. He mentioned that Lebanese Hezbollah, Hamas, and Islamic Jihad all traffic from Colón to Maicao, Colombia, on the Guajira Peninsula, which I know well as a transnational trafficking hot spot, as well as a hot spot for a significant Arab diaspora—one that is also Marxist and that has extensive relations with the Colombian narcoterrorist group FARC. Many of the most radical Chavistas of the Venezuelan government were either raised on the Venezuelan side of the border in this region or went to school there, particularly at the Universidad de los Andes.

  Eduardo said there were approximately five thousand Palestinians and Lebanese in Maicao, and that they were suspected of shipping Venezuelan uranium to Iran. Iranian merchant marines operated out of Venezuela, and the Americans were increasingly concerned about dual-use technology transiting through the Panama Canal on its way to Iran. Iranian influence, he said, was a huge problem in the region: an Iranian university (in Iran) was giving scholarships to fifteen hundred Mexicans a year to come study in Iran and learn about Islam, but the kids were effectively becoming radicalized. It was his view that Iran had a much more aggressive radicalization program in Mexico than anywhere else in Central America.

  He also spoke of a Muslim Indian community in Agua Dulce in Panama, and said they were mostly peaceful and mostly involved in the business of used cars in Panama City. I answered that used cars was a very well-known money-laundering scheme, seen also in West Africa. He spoke of the flight of Jews from Venezuela to Panama, as a result of the anti-Semitism under Chávez and since. He said that since the Israeli Embassy in Venezuela was closed, most of Mossad’s intelligence operatives had been moved to Colombia. He claimed that Russian Jews who are Israeli Mafia traffic drugs and weapons through the Panama Canal, in collaboration with Mossad, and that he knew this because he had excellent relations with the Israeli Embassy in Panama.

  He also said that Dino Bouterse, the son of Suriname’s president, had been trying to set up an Islamist training camp in Suriname, but was captured in Panama and is now in prison in New York. As a result, he said, he had strained relations with the elder Bouterse, but was very good friends with another presidential candidate: Chan Santokhi. Eduardo also mentioned that San Pedro Sula, in Honduras, had lots of active Arabs; it had been known as the most violent city on earth, with the world’s highest homicide rate, until it was overtaken in that dubious distinction by Caracas, Venezuela. He said that the Islamic Foundation of Panama had been funded by Moammar Qaddafi, but he did not know who was funding it since Qaddafi’s death.

  After the meeting, I went up to my room and called my driver, Miguel, asking him to take me to two of the three mosques I had identified as being of interest: the Islamic Foundation on Mexico Avenue in Panama City and the Islamic Cultural Center in Colón. The Colón mosque was funded by the Saudis, according to Eduardo, just as was the Islamic Center in Santiago, Panama. A US-based colleague who focuses on the Muslim Brotherhood identified the Santiago center as a probable hub for the Brotherhood, so I wanted to visit that the following day, as it would be a four-hour drive each way.

  I arrived at the Islamic Foundation wearing the traditional Muslim clothing of a hijab (the head scarf that covers the hair and encircles the face) and an abaya (the voluminous robe worn over a woman’s clothing), one of the two I had bought in Dubai. I arrived at the Islamic Foundation mosque and was received very politely by an imam, a religious teacher. I told him I was seeking to learn more about the great success of the Muslim community in Panama and how they had come to be so loved and such an economic force in the country. I waited while he made a phone call. He told me to return at 6 p.m., when Professor Yunus Magda would be there to speak to me. The imam handed me his own card. The name matched one of the two muftis identified by a colleague as cause for concern: responsible for increased jihadist activity in Panama. I told him I would be back at 6 p.m. and had Miguel drive me out to the Colón free trade zone to find the Islamic Cultural Center in the meantime.

  TROUBLE IN COLÓN

  In Colón, I arrived first at the Ramadan Karim mosque, but found it empty. I walked around the corner and found the Islamic Cultural Center. Young Muslim men were unloading trucks of food in a quantity that far exceeded what any party might require, but might instead feed an entire town. One of the Muslim men escorted me into the entrance of the center, where they were stockpiling the food. All of the Arabs spoke Arabic but very little Spanish.

  “¿Qué pais?” asked one man. What country?

  I said I was Venezuelan, and held up my Venezuelan passport. One of them fetched me a chair and used his phone to call someone to come and speak to me. While I waited, I was approached by the only man who could communicate with me even minimally: a Moroccan who told me his name was Rafiq. I initiated a conversation with Rafiq in French about Ramadan. I told him I had a very dear friend in New York who was Saudi, indeed part of the Saudi government delegation to the UN, and that he told me that he was struggling with Ramadan. I told him that I had always wanted to go to Saudi Arabia, as it seems a great country, and then I asked him whether all this was funded by Saudi Arabia.

  “Yes. Saudi. All Saudi.”

  “Is this the most important mosque in the country?”

  “Yes,” he answered. “Colón most important. All other mosques in Panama controlled by Colón.”

  “That’s wonderful,” I said.

  My ride arrived: a young boy named Osama, who pulled up in a white SUV and received instruction from one of the Arabs who had let me into building. I introduced myself in typical demure Muslim fashion, with my hand on my chest and a nod of the head, so I was surprised when he shook my hand. He told me to get into his car and he would take me to see his father inside the free trade zone. I told him I wanted to go with my driver and his wife. He suggested I should get into his car and they could follow in their car, but they’d have to wait outside the gates of the free trade zone, as their car did not have permission to enter. I counteroffered that the two of them should come with me in his car. He agreed, so that is what we did.

  On the drive to the free trade zone, Osama was very friendly and chatty. I told him that I was surprised by the poverty in Colón, as I thought there would be much more prosperity spilling out from the free trade zone. I asked him what all the food was for. He said that every Saturday during Ramadan, they give out food to two thousand local non-Muslim families, who come to the Islamic Center with tickets that are given to them to claim their food—one ration per family, which is estimated at five people. Two people from the same family cannot claim food. He said they kept order by going to the houses to distribute the tickets before Ramadan.
I said that for this to be possible, there must be a local census with a listing of every family member living in each household. He said yes, they do keep a list of all the locals and in which houses they live. I suggested that this was very kind and considerate of them and explained why they were so loved by the community. This made him smile.

  Upon arriving at the free trade zone I was taken to a shop with a sign on the door, ARCO IRIS (Spanish for “rainbow”), and was told to enter. It was a wholesale shop of small electronics. A woman in an abaya at the back of the shop asked my name. I told her I was there to meet with Osama’s father, to whom I had been referred by the Islamic Cultural Center. She called him on the telephone and then said I could go in. I rounded a wall behind the counter and entered an office. At a desk facing the door was a gray-haired, bearded man who was very obviously the man in charge and the one I was going to meet. At a table positioned perpendicular to that one, at some distance to the right, sat another woman in an abaya, this one middle-aged. A man in his thirties stood between me and the door as I sat down in the chair in front of the man I was there to see, who never introduced himself. But he had a lot of questions.

  “They told me you were here to convert to Islam.”

  “Well, I’m Catholic, but I’m very mixed. Many members of my family moved great distances to escape oppression,” I tried to explain, and at the same time bond.

  The woman asked: “Are you Jewish?”

  “I am not, but my ancestors had been considered Jewish, although nobody practiced.”

  “You’re a Jew,” she repeated.

  “I am Catholic, but greatly interested in Islam, because I have many great friends from the Middle East and travel there often and am very impressed by the culture and tradition.”