Terrorism, Inc.: The Financing of Terrorism, Insurgency, and Irregular Warfare
Page 9
Money Laundering
Funds generated from legal businesses would be diverted to the group’s war aims and ill-gotten gains from an array of smuggling activities were laundered through Tamil-owned legal businesses and money exchange and transfer agencies (similar to hawalas) to evade detection by authorities. The LTTE became involved in the film industry, first through trading and investing, but later by founding video and CD shops, which generated sizeable revenue.21 Because the LTTE earned so much money through drug trafficking, it was essential that the group developed a proficiency in money laundering in order to make those profits usable. Indeed, money raised through the sizeable Tamil community in Canada was allegedly laundered through German and Singaporean banks which helped fund the purchase of explosives in Ukraine which were then used to blow up the central bank in Sri Lanka.22 The LTTE was also suspected of maintaining a limited money laundering infrastructure in Indonesia.23
Dark Economy
LTTE members engaged in almost every form of organized crime possible, from drug trafficking to extortion and arms smuggling. The LTTE’s vast criminal enterprise, detailed at length throughout this section, also enabled weapons procurement by putting the group’s members in touch with a wide range of nefarious individuals, including arms dealers, weapons brokers, and intermediaries. According to Peter Chalk, the Tigers acquired U.S. Stinger-class missiles from the PKK in 1996 and used these weapons to shoot down a Sri Lankan civilian Lionair jet in 1998.24 Several years earlier, in April 1995, the LTTE shot down two Avro transport aircraft of the Sri Lankan Air Force, killing everyone on board. This was the first known use of missiles by the insurgents and observers argue that the introduction of missiles changed the dynamics of the conflict from that point forward.25
Kidnapping for Ransom (KFR)
Although not as prolific as some groups in South Asia, such as the ASG, the LTTE did indeed help realize their financial objectives through kidnapping for ransom.26 Since the Tigers were acutely aware of not alienating potential supporters, kidnapping was not a tactic that was employed frequently, although it did happen from time to time when the group needed to raise funds quickly, as occurred in March 2006 when the LTTE kidnapped three teenagers.27 For the most part, the LTTE’s portfolio of other criminal activities was so lucrative that the group felt little need to risk alienating potential supporters by engaging in this lurid practice. During the last phase of its struggle, desperate to replenish the ranks of a rapidly depleting military force, the LTTE occasionally resorted to kidnapping teens and young children to help it fight against the Sri Lankan security forces.
Armed Robbery and Theft
Beginning in the mid-1980s, Tamil groups embarked on a bank robbing spree in Jaffna. Out of ignorance, the LTTE argued that it was stealing from the “public” and not the Tamil people.28 Armed robbery of banks was employed by the Tigers early in their tenure, but faded in popularity as a fund-raising tactic through the years. Also in the early stages of the insurgency, Tamil militants pillaged and plundered the residences of non-ethnic Tamils living in Sri Lanka. Over time, as the organization developed its maritime capabilities, it was able to take advantage of robbing ships and vessels on the high seas. To be sure, piracy was a lucrative form of robbery for the LTTE.29 In some cases, Tamil militants have received funding to prevent theft and armed robbery—like the PIRA and other groups, LTTE members were paid to “ride shotgun” and provide the “muscle” for international drug shipments.30
Smuggling, Trafficking, and Counterfeiting
Involvement in the drug trade first became apparent as early as 1984 when Swiss police reported that Tamils were responsible for trafficking approximately 20 percent of the heroin coming into the country.31 The “Tamil connection” in Switzerland, as it came to be known, was eventually dismantled by the police, although the drug market in Sri Lanka itself expanded, with an estimated 100,000 users by the end of the 1990s.32 Italian police also broke up several Tamil heroin rings throughout the 1980s. Sri Lanka’s geographic proximity to the Golden Triangle of Laos, Myanmar, and Thailand, combined with the LTTE’s advanced maritime capabilities made heroin trafficking an obvious racket for the group to pursue.33 The Tigers’ reach also extended into Pakistan, where they linked up with notorious Indian crime boss Dawood Ibrahim and his “D-Company” gang. They used the port city of Karachi to solidify a foothold in South Asia and diversify smuggling activities to include humans, in addition to heroin.34 The Sri Lankan government reported that the LTTE’s human trafficking business netted the group approximately $340 million by smuggling 17,000 people to 11 different countries.35
The smuggling and trafficking of humans provided the LTTE with the funds necessary to continue its operations.36 LTTE insurgents became experts in the illicit movement of people, arms, and equipment, all of which requires specialized skills and access, including access to (or the ability to produce) fraudulent international documents, including visas, passports, end-user certificates, business regulations, shipping licenses, and so on.37 In Europe and Australia, LTTE members perfected the counterfeiting of currencies.
Extortion and Protection
Extortion often involved coercion, with direct threats of implied violence to those who failed to “donate” to the Tigers’ war chest.38 Other times, extortion was accompanied by intimidation, blackmail, beatings, and threats against family members, both in Sri Lanka and abroad. Finally, the insurgents levied “taxes” on a network of Hindu temples in the United Kingdom and Canada.39 The LTTE also made money through extortion in Germany. In Sri Lanka, traffickers of illicit commodities brought drugs and other contraband into the country through LTTE-controlled territory.40 This allowed the group to extort the traffickers by demanding they pay a “tax” or “donation” for moving ahead unmolested. LTTE protection rackets in the émigré communities of Toronto raised an estimated $1million a month.41
External State Support
In any insurgency, diversifying the source of a group’s weapons is critical, as the LTTE learned in 1987 when the Indians withdrew their sponsorship. Per the terms of the Indo-Sri Lankan Peace Accord, the Indian government agreed to cease its support for the Tigers by cutting off the arms pipeline. The importance of diversification was even more apparent following the downfall of one of the LTTE’s main rivals, the People’s Liberation Organization of Tamil Eelam (PLOTE). PLOTE was crippled when a shipment of weapons destined for the group was intercepted in Madras (now Chennai) and the group’s leaders forfeited a $300,000 down payment already paid to the Palestinian group al-Fatah.42 Keen not to suffer a similar fate, the LTTE developed contacts abroad, and soon engaged in procurement activities in Northeastern and Southeastern Asia (especially China, North Korea, Cambodia, Thailand, Hong Kong, Vietnam, and Myanmar), Southwest Asia (Afghanistan and Pakistan), former Soviet Republics (primarily Ukraine), Southeast Europe and the Balkans (Greece, Bulgaria, Cyprus), the Middle East (Turkey, Lebanon), and Africa (Nigeria, Zimbabwe, and South Africa).43
The South African connection proved particularly fruitful for the Tigers. Situated between the active arms markets of Mozambique and Angola, weapons dealers in South Africa provided the LTTE with consistent access to a steady supply of small arms.44 Furthermore, South Africa maintained a fairly robust communications and transportation infrastructure, which made it an attractive location for illicit activity.45 For most of the 1990s, the Tigers used Myanmar as a logistical hub but later moved the bulk of their operations to Bangkok. Thailand’s geography, established international business presence, and easily corrupted security officials made it an ideal choice for the LTTE’s logistical hub.46
From the post–Cold War arms bazaars in Beirut and Peshawar, and especially those in Cambodia, Myanmar, and Afghanistan, the insurgents acquired rapid-fire pistols, assault rifles, rocket-propelled grenades, and surface-to-air missiles. Ammunition needs were met through intermediaries in Bulgaria, the Czech Republic, and North Korea, which supplied mortar, artillery, and 12.7 mm machine gun rounds.47 O
ccasionally, as it did in Mullaithiu in 1996, the LTTE would raid Sri Lankan military bases and steal whatever weapons were available. The Mullaithiu raid proved extremely bountiful, as the insurgents acquired multi-barrel rocket launchers (MBRLs), T69-1 RPG launchers, artillery batteries (122 mm, 130 mm, 152 mm), various mortars (120 mm, 106 mm, 81 mm, and 60 mm) and an array of anti-armor and anti-aircraft systems, to include W-85 anti-aircraft guns.48 Finally, the group rounded out its arsenal through the procurement of explosives from suppliers in the Ukraine and Croatia.49
WHAT LTTE ACHIEVED WITH THESE FUNDS
The LTTE’s efforts to procure weapons and establish a global arms network brought it in contact with several other insurgent and terrorist groups. In addition to Khalistan-oriented Sikh insurgents, Kashmiri mujahedin, and Middle Eastern militants, the Tigers forged links with over 20 separate Tamil Nadu separatist groups.50 While many of these relationships were temporary and tactical, more an example of strategic cooperation than a long-standing relationship, others proved durable and resulted in considerable tacit knowledge transfer. Jemaah Islamiyah (JI) insurgents were trained by LTTE Sea Tiger officers in seaborne suicide tactics in Indonesia.51 Technological exchange occurred with Indian insurgent groups such as the United Liberation Front of Assam (ULFA) and the Communist Party of India (Marxist-Leninist) People’s War, also known as the Andhra Peoples War Group, or PWG.52 When PWG member Marepalli Basavaraju was apprehended by the Indian government he admitted that his group had received explosives training from an LTTE expert in land mine technology.53
The LTTE have allegedly served as an intermediary between insurgent groups and have transported arms to the ASG on behalf of Harakat-al Muhahideen, a Pakistani militant group linked to Al-Qaida.54 Though the group became wary of associating with Al-Qaida or Al-Qaida affiliated groups following the attacks of September 11th, the LTTE continued to train divisional commanders of the Communist Party of Nepal-Maoist (CPN-M).55 Other insurgent groups known to commiserate with the LTTE at various times during its existence include the FARC, the African National Congress (ANC) in South Africa, the South West African People’s Organization (SWAPO) in Namibia, the Eritrean People’s Liberation Front (EPLF), MILF, the Tigrayan People’s Liberation Front (TPLF) in Ethiopia, Hezb-i-Islami Gulbuddin (HIG) in Afghanistan, the Japanese Red Army (JRA), and the PFLP.56
Linkages with a smorgasbord of insurgent groups allowed the LTTE to circumvent existing international arms control conventions and add to an already potent arsenal. The LTTE’s relationship with the Khmer Rouge in Cambodia was integral to its ability to obtain weapons. These deals took place across the Cambodian border in Trang, Thailand, where the weapons would be purchased and then moved along the Andaman sea coast, where they were shipped across the Bay of Bengal to LTTE insurgents in Sri Lanka.57
Operational Capabilities
LTTE’s operational tools included weapons, sanctuary, and funding, pitted squarely against a Sri Lankan COIN force that waged a take-no-prisoner war to exterminate Prabhakaran and the LTTE. But perhaps the most impressive was the LTTE’s world-class maritime capabilities. Flush with cash, Prabhakaran understood that if his group were to have a legitimate chance to defeat the Sri Lankan military, the Tigers had to develop an effective maritime capability. In 1984, Prabhakaran created the Sea Tigers, which consisted of two groups. The first group concentrated on tactical actions while the second group was responsible for the LTTE’s expanding fleet of merchant ships, known as the Sea Pigeons, which ferried both licit and illicit goods. Within this division were thirteen sections, including the Sea Battle “Regiments,” Underwater Demolition Teams, Sea Tiger Strike Groups, and a Radar and Telecommunications Unit. A Marine Engineering and Boat Building Section, a Maritime School and Academy, a Recruiting Section, and sections to support ordnance, personnel, and logistics were all part of the Sea Tigers’ shore infrastructure.58
Weapons
The LTTE’s weapons procurement network has been called the “most secretive” of the group’s international operations.59 The earliest identified network was run by Sothilingam Shanthakumar, a smuggler from the Valvettithurai, a fishing port that serves as the base for a distinct caste of Tamil fishermen.60 Until 1987, the LTTE relied almost exclusively on the Indian intelligence services, especially the Research and Analysis Wing (RAW) to provide arms and explosives.61 From 1987 onward, following the Indo-Sri Lankan Peace Accord, the LTTE sought to diversify its source of weapons and made the establishment of a global procurement network one of its top priorities. The Tamil Tigers also used explosives to establish themselves as one of the most feared insurgent groups in the world, known for their extensive use of suicide bombing. Finally, the group developed legitimate air and sea capabilities to complement its ground forces, thus rounding the organization into a comprehensive military threat.
The LTTE’s procurement network was led by Tharmalingam Shanmugam, alias Kumaran Pathmanathan and known in shorthand simply as “KP.” He was so closely associated with the Tigers’ arms network that their global weapons operations were referred to as the “KP Department.”62 The “KP Department” prioritized the acquisition of explosives, but unlike the PIRA, the LTTE was not adept at producing these indigenously. In August 1994, the “KP Department” arranged for the shipment of between 50–60 tons of RDX and TNT explosive acquired through the Rubezone Chemicals plant and sent from the Port of Nikolayev in Ukraine to Sri Lanka. The deal was brokered through an LTTE front company known as Carlton Trading, which was based in Dhaka, Bangladesh, and facilitated through the use of false end-user certificates.63 Other front companies were set up in Chittagong, Yangon, and Kuala Lumpur.64 The LTTE’s weapons inventory, in addition to the arms and equipment listed above, also included a T-55 tank, Russian-made Strela-3 man-portable air defense systems (MANPADS), six Czech built Zlin Z-143 single-engine aircraft, 50 to 100 frogman kits and five to 10 underwater scooters, a fleet of 500 to 1,000 fiberglass boats, between six and 10 Mirage-class boats, and four partially completed submersibles.65 The insurgents used Global Positioning System (GPS) to more accurately deploy their missile projectiles well before the COIN force acquired this same capability.66
Intelligence
Although the insurgents had utilized guerilla tactics to devastating effect against the COIN force, the LTTE realized that to stave off defeat, it had to counter Colombo’s moves by enhancing its capabilities and upgrading its infrastructure. As part of its efforts to innovate in the area of weapons technology intended to blunt COIN force countermeasures, the LTTE diverted resources to its two operational wings that functioned as suicide strike teams, the Black Tigers and the Sea Tigers.
The LTTE developed the capability to assassinate Sri Lankan government officials, foreign officials, and high-ranking members of the COIN force military services. When the LTTE wanted to renege on a peace agreement, the group commonly used assassination of a top Sri Lankan official to convey this message clearly.
Prabhakaran’s ironclad grip over the organization started to fray beginning in the early 1990s, when he ordered the execution of long-time confidant and high-ranking LTTE member Mahattaya. Prabhakaran accused his erstwhile colleague of plotting with the Indian army’s RAW to kill the top leadership of the group, including Prabhakaran himself.67 A second and even more devastating schism occurred with the defection of one of the LTTE’s top commanders, Vinayagamoorthy Muralitharan (“Karuna”) in early 2004. The falling out between Prabhakaran and Karuna effectively split the LTTE in two; the former retained control of the northern faction while the latter came to exert control of the Tigers’ eastern faction. When the split led to open conflict between the two groups, the Sri Lankan government’s special task force supplied Karuna’s fighters with arms and sanctuary in return for intelligence about the LTTE’s northern units.68 Karuna subsequently handed over the LTTE playbook, which the COIN forces used to plan their final offensive.
Table 3.1
Liberation Tigers of Tamil Eelam Technological Innovations1 Innov
ationPurposeIntended Mitigation of Government Countermeasures
Wax-coated wiring in explosive devices Prevent emission of explosive vapors Defeat detection by sniffer dogs
Airtight casing for explosive devices Prevent emission of explosive vapors Defeat detection by sniffer dogs
LED indicator lamps in bomb circuits Verify “live” circuitry
Secondary, tertiary detonation triggers in explosive devices Provision of internal fail-safe mechanism
“Explosive bra cup” design for suicide vest Conceal explosive slabs Defeat physical hand searches
Elongated fuel tank in vehicle bombs Conceal explosive devices Defeat detection by “dipper” probes
Chassis molded, mint-laced explosive devices Conceal explosive charge and prevent emission of explosive vapors Defeat causal visual inspections and detection by sniffer dogs
Hollowed out, shallow superstructure for suicide boats Increase speed and reduce surface detection Minimize radar cross-section