- The Washington Times - Thursday, February 21, 2002

Federal agents yesterday raided businesses and homes in 14 states in a crackdown on an operation suspected of illegal money transfers to Iraq.
The U.S. Customs Service raids targeted individuals serving as money-transfer agents for Al-Shafei Family Connect Inc. (AFCI), a money-transmitting business based in Mountlake Terrace, Wash. The firm is owned and operated by Hussain Al-Shafei, a naturalized U.S. citizen born in Iraq.
The probe also has focused on possible money laundering.
Customs agents, assisted by officers from the Internal Revenue Service, Secret Service, U.S. Immigration and Naturalization Service and various local and state police agencies, conducted the raids in Buffalo, N.Y.; Chicago; Louisville, Ky.; Dallas; Detroit; Memphis, Tenn.; Minneapolis; Erie, Pa.; Portland, Ore.; Lincoln, Neb.; St. Louis; Tucson, Ariz.; Seattle; and Roanoke.
The agents, armed with 29 search warrants, did not arrest anyone, but seized evidence from the 14 AFCI locations. The information is now being processed. Charges in the case are pending.
"Federal law prohibits the direct or indirect transfer of funds to the government of Iraq or its people," said Customs Commissioner Robert C. Bonner. "The U.S. Customs Service is committed to uncovering and punishing those who violate Iraqi embargo statutes."
AFCI allows immigrants in the United States to send money back to their native country. Customs officials said bank records show that between 1999 and 2000, AFCI transmitted more than $15 million to individuals and businesses in Jordan, much of which was routed elsewhere including Iraq.
Customs agents have accused the company of sending millions of dollars to Iraq in violation of the decade-old embargo.
In a declaration filed last month by Mr. Al-Shafei in Seattle, after a raid on AFCI offices in that city, he said "approximately 80 to 90 percent of Iraqi refugees in the United States use Al-Shafei Family Connect Inc. to send money to their family members in Iraq."
During a search of AFCI offices in Seattle, customs agents found files labeled with the names of individual agents of AFCI throughout the United States. In his declaration, Mr. Al-Shafei described how he routed some of the cash to recipients in Iraq, via an agent in Jordan.
"Every approximately two to three days, I pool these deposits and then ask [the bank] to wire the sum of the individual deposits to a bank in Jordan. It is not possible to send the money directly to Iraq because of the trade embargo," he said in the declaration.
An executive order signed by former President George Bush forbids Americans from transferring money to the Iraqi government or its people.
The order specifically prohibits any unauthorized "commitment or transfer, direct or indirect, or funds, or other financial or economic resources by any United States person to the government of Iraq or any other person in Iraq."


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