Where Hamas Gets Its Money

The U.N., the E.U., the Gulf States, the U.S.--and Israel

Original article
by Rachel Ehrenfeld, 01.16.09, 05:15 PM EST


Amid international condemnation of Israel, one would never guess that humanitarian aid and even cash is flowing into Hamas coffers, while its rockets continue to hit Israel.

It is important to alleviate the suffering of innocent Palestinians. However, since Gaza is under Hamas control, we have to ask: Will aid reach the suffering populace? If the past is any indication, most funds and supplies will end up with Hamas.

The world community that berates Israel for defending itself from constant attacks by the terrorist group also facilitated Hamas' victory in the 2006 Palestinian Authority election, when it was allowed to run under the name "List of Change and Reform."

Since then, despite repeated promises to cut off funds for Hamas, international aid organizations and many countries kept on sending money to Gaza, purportedly for humanitarian aid. The United Nations Relief and Works Agency, the U.N. agency for Palestinian refugees, raises money for Gaza through its Web site, with payments going through WorldPay (part of the Royal Bank of Scotland Group), the Arab Bank PLC in Gaza and HSBC in Amman, Jordan. Those funds come in addition to UNRWA's annual budget of $400 million.

The $7 billion to $10 billion that the Palestinian Authority has received since 1993 has come from the European Union, the U.N., the U.S., Saudi Arabia and other Arab League countries. France alone has sent more than $3 billion. This influx of cash has done little to advance the development of a viable Palestinian state or of peace in the region. Rather, it has helped to fuel the Palestinian leadership's terrorist agenda, and kept the Palestinian people oppressed and disenfranchised.

In the mid-1990s--shortly after the Palestinian Authority came into existence--the Palestinian writer Fawaz Turki described the regime as "the dissolution of civilized society, of all civil norms and all hope." Despite all of this, most international organizations and the world community at large continue to ignore the ongoing human and civil rights violations perpetrated against the Palestinians by their own leadership, including the destruction of Gaza and the death of hundreds of its citizens.

In a meeting hosted by Abu Dhabi on Jan. 12, representatives from the Palestinian Authority and several donor countries, including Egypt, Britain and the U.S., met to discuss efforts to raise and send undisclosed amounts of money to help Palestinians in Gaza. The United Arab Emirates (UAE) also pledged to rebuild schools, mosques, hospitals and 1,300 damaged Gaza houses. In addition, the Emirates raised more than $87 million in a nationwide telethon on Jan. 9.

How would the money find its way to Gaza? "It is now the job of experts to funnel the cash," said UAE Foreign Minister Anwar Gargash. The experts do not have to look hard: They can funnel the money through the vast tunnel network that runs from the Egyptian border into Gaza. The Israelis have destroyed many of these tunnels, but enough remain through which to continue to smuggle cash and other supplies, including weapons.

The buildup of this underground complex sped up after March 2007, when the U.S. gave Egypt $23 million in special aid to stop underground smuggling into Gaza. Despite that apparent failure, on Friday, Jan. 16, under American and international pressure, Israeli Foreign Minister Tzipi Livni signed an agreement with U.S. Secretary of State Condoleezza Rice, under which the U.S. will commit resources to help Egypt patrol the boundary.

Supplies and cash for Hamas have been pledged from all over the world, not merely from Iran, On Jan. 3, Saudi Arabia's King Abdullah bin Abdulaziz donated $8 million of the more than $26.7 million raised in a national fundraising telethon for the "Relief of the Palestinian People in Gaza." Qatar, which pledged $50 million when Hamas was elected in 2006, promised to send more.

While condemning Israel, the European Union pledged more than $4 million in "humanitarian aid" to Gaza. In 2008, it provided Gaza with $55.6 million. In addition, European Union member states pledged more than $41 million, including $10.5 million from the British government's Department for International Development. Japan pledged $10 million, and terror-struck India said it would send $1 million. Norway has announced a pledge of about $4.5 million, while Australia is adding $3.5 million in addition to the $32 million it gave in 2008. Additionally, other countries sent tons of medical and humanitarian supplies. This more than meets the UNRWA emergency appeal for $34 million.

Incredibly, Israel also supplies Hamas with cash. It began transferring truckloads of cash to Gaza after Hamas' violent takeover of the territory in June 2007. The first transfer of more than $51 million (delivered in Israeli shekels) was purportedly to strengthen the influence of Palestinian Authority President Mahmoud Abbas in the Gaza Strip and pay the salaries of 35,000 Palestinian Authority employees then allegedly loyal to him. Among those employees, however, were Ismail Haniya, the Hamas-appointed prime minister in Gaza, and Mahmoud Zahar, Hamas' foreign minister.

Zahar prides himself on many successful terrorist attacks against Israel, and his position regarding Israel is clear. "All of Palestine, every inch of Palestine belongs to the Muslims," he has said. If the goal was to strengthen Abbas' position, the cash should have been delivered to him in the West Bank city of Ramallah. From there, he could have transferred the money to Gaza, as he has done in the past, and claim credit for it.

Yet the Israelis relied on Palestinian Prime Minister Salam Fayyad's promise that the money would not reach Hamas or be used for any terrorist activity--even though Fayyad has little control over Palestinian Authority funds in Fatah-controlled West Bank, let alone in Hamas-controlled Gaza. Not long ago, Fayyad himself stated (and not for the first time) that controlling Palestinian finances "is virtually impossible." Besides, promises by Fatah leaders that they will stop funds from going to Hamas are dubious at best.

Despite Fatah-Hamas disagreements, the Palestinian Authority's Fatah-led government announced on Jan. 15, 2008, its intentions to give Hamas 40% ($3.1 billion) of the $7.4 billion pledged in December 2007 by international donors. In October 2008, despite the crackdown on Fatah members in Gaza, the Palestinian Authority was paying the salaries of 77,000 "employees."

In December 2008, under U.S. and international pressure, Israel delivered between $64 million and $77 million in cash to Gaza. When Hamas rocket attacks intensified, Israeli banks started refusing to transfer cash to Gaza. World Bank President Robert B. Zoellick, International Monetary Fund Managing Director Dominique Strauss-Kahn, and Tony Blair, who is now Mideast envoy for the E.U., Russia, the U.N. and the U.S., sent a letter to Israeli Prime Minister Ehud Olmert complaining that such refusals are "counterproductive and ultimately harm Palestinian moderates." Clearly, the world community is set on seeing the terrorist group Hamas as legitimate. But demanding that Israel pay its own executioners goes way too far.

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Dr. Rachel Ehrenfeld is director of the American Center for Democracy and author of Funding Evil: How Terrorism is Financed and How to Stop It