Wednesday, June 30, 2004

KOIDU, Sierra Leone - Lebanon’s Hezbollah guerrilla movement is siphoning profits from West Africa’s diamond trade, in part by threatening Lebanese diamond

merchants, U.S. diplomats say.

The accusation, supported by independent analysts, describe more pervasive, organized and coercive Hezbollah activists profiteering from West Africa’s diamond trade than most U.S. officials had previously acknowledged.

“One thing that’s incontrovertible is the financing of Hezbollah. It’s not even an open secret. There is no secret,” said Larry Andre, deputy chief of mission for the U.S. Embassy in this diamond-rich country.

“There’s a lot of social pressure and extortionate pressure brought to bear: ‘You had better support our cause, or we’ll visit your people back home,’” said Mr. Andre, citing interviews of Lebanese merchants by embassy staff.

More than 100,000 Lebanese live in West Africa, where they have been the core of the merchant class for over a century and have long handled much of the diamond business. Many Lebanese retain strong business, cultural and family ties to their homeland.

Lebanon-based Hezbollah fought a guerrilla war against Israeli troops in south Lebanon for nearly two decades until the Israelis pulled out in 2000. Today, the border is tense but mostly quiet. Hezbollah remains armed and hostile to Israeli encroachment.

The movement is also known for the bombings of the U.S. Marine barracks in Beirut in 1983 and of the U.S. Embassy annex in Beirut in 1984 — earning it a spot on the State Department’s list of terrorist groups. Until the September 11, 2001, attacks, Hezbollah was estimated to have killed more Americans than any other terrorist organization.

Hezbollah also has political and charitable wings, and funds the building of schools, clinics and mosques. Its social programs help win the group support among Lebanese at home and abroad, as does its reputation among many Lebanese as a defender of Arabs against Israel. Most Lebanese do not believe Hezbollah is dangerous.

Only 6,000 Lebanese are thought to remain in Sierra Leone after this country’s 1991-2002 war for control of the eastern diamond fields around Koidu, West Africa’s richest known deposits.

West Africa’s so-called “blood” diamonds helped buy arms and bankroll insurgencies that roiled the region in the 1990s. With the end of fighting and the advent of an industry-backed certificate-of-origin program, Sierra Leone estimates its legal exports of diamonds have soared from $1.4 million in 1999 to $76 million last year.

The U.S. Embassy in Freetown says rough diamonds worth $70 million to $100 million are smuggled out of the country each year, even now.

It’s owing largely to the illegal trade that Hezbollah can extract cash by threats, beatings and destruction of property, analysts say. Victims, many of whom may have business dealings they do not want exposed, have little legal recourse.

“They [Hezbollah] are asking for contributions and they’re going to use the culture card and the nationality card,” Joseph Melrose, former U.S. ambassador to Sierra Leone, said. “Will they use threats? Sure.”

The amount of money is sizable: In December 2003, an airliner that crashed off Benin had a courier on board carrying $2 million in Hezbollah-bound funds, diplomats and news reports said.

In Lebanon, a Hezbollah official refused comment.

One of Sierra Leone’s top diamond exporters denied any ties to Hezbollah.

“This is a lie. There’s never been any connection between these people and Hezbollah,” said Kassim Basma, who was born in Sierra Leone to a Lebanese family. “For me, I couldn’t support them. For what? To cause myself problems?”

Matthew Levitt of the Washington Institute for Near East Policy said stepped-up enforcement in South America drove some Hezbollah activists to West Africa. As a result, the group’s illegal fund-raising efforts in the region — including protection rackets and threats — may be on the rise, said Mr. Levitt, a former FBI agent.

“As we crack down on one part of the world, things will crop up elsewhere,” he said.

In Koidu, indigenous Sierra Leoneans account for about 35 of the roughly 200 legal diamond buyers, said Prince Saquee, chairman of the Diamond Dealers Association. Most of the rest are Lebanese, he said.

Among Koidu’s burned-out, bullet-pocked buildings, hundreds of diamond buyers run heavily guarded storefronts with signs emblazoned with enormous, glittering cut diamonds.

Many in the State Department and officials at U.S. embassies in West Africa have long played down any West Africa conduits to Hezbollah, saying contributions to the group appear to be voluntary donations by individuals.

Alex Yearsley of London-based Global Witness said the CIA and FBI long tried to publicly minimize links between under-the-table diamond transactions and Islamic militant groups, including al Qaeda.

The U.S. agents feared exposure of their own longtime links with Charles Taylor, the ousted Liberian leader who played a main role in West Africa’s insurgencies and “blood diamond” trade, Mr. Yearsley said.

Mr. Taylor received CIA payments until January 2001, he said.

Diplomats and some independent experts doubt Global Witness claims about links between West Africa diamonds, al Qaeda and Hezbollah, saying they are short on proof.

The fate of West Africa’s diamonds crosses faiths and rivalries. Sold by the Lebanese merchants, many of the gems are brokered via Jewish or Israeli traders in Antwerp, Belgium, and Tel Aviv, and end up in the United States.

“To us, we don’t see Christian or Muslim or Jew,” said Mr. Basma. “We’re businessmen.”

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