Kidnapping: Why Al Qaeda Needs Donations More Than Ransoms

Yesterday, the Foreign Policy Research Institute provided me another opportunity to post on their blog Geopoliticus.  For this post, I did an extended discussion and update to a series of posts I did with Alex Thurston several years back regarding AQIM’s use of kidnapping in the Sahel.  For the old discussions of AQIM & others’ kidnapping operations see these posts and Alex’s excellent insights at these posts –  #1, #2, #3, #4 and #5.

In this new post, entitled “Why al Qaeda Needs Donations More Than Ransoms,” I discuss the trade offs and disadvantages for al Qaeda affiliates such as AQIM that are dependent on illicit funding schemes, namely kidnapping, to sustain their operations.  I conclude with the opinion that al Qaeda needs donations more than ransoms if they intend to orchestrate a comeback.  Here’s an excerpt of the post below and for the entire post, visit this link at FPRI.

“On the surface, kidnapping and smuggling appears an ideal financial engine for terror groups like al Qaeda and its affiliates. This assertion, however, ignores the inherent challenges encountered when any organization, whether terrorist group to criminal enterprise, undertakes illicit funding schemes.  Kidnapping and ransom operations introduce significant transaction costs which significantly devalue the gross sum of revenues.  Kidnapping operations create a series of internal costs for terror groups:

  • Networks Of Intermediaries –  Negotiations and payments for kidnapping operations require layers of middlemen with each network extracting a percentage of the overall take.

  • Transaction Time – The time between hostage taking and ransom payments can be significant requiring the terror group to maintain a solid reserve of capital to sustain its operations between transactions.  Essentially, time is money, and in the case of kidnapping operations, a cost to the terror group.

  • Hostage Deaths – The trauma of kidnapping and the harsh environments in which terrorist groups operate often result in the death of hostages.  The death of a hostage hurts the terror group directly in terms of loss revenues. But, even more damage occurs indirectly as the hostage death erodes trust for future ransom negotiations.

  • Infighting – In any business, transactions often lead to conflict.  This is particularly true in illicit industries where trust is constantly being questioned.  Kidnapping negotiations naturally generate friction between intermediaries and when negotiations become protracted parties may turn to open conflict.

  • Declines in Hostage Availability – As groups like AQIM continue to kidnap hostages, the availability of hostages naturally declines requiring the terror group to operate at longer distances to acquire captives.  This distance imposes significant logistical costs.

  • Undermines Terror Group’s Ideology – Inevitably, in illicit schemes and even licit enterprises, business gets messy and the terror group must make choices with regards to sustaining its resource flow.  Often times, these choices result in alienation of a terror group’s local base of popular support or hypocritical conflicts of interest between the terror group’s deeds and its words.  The recent accusations of Omar Hammami, an American foreign fighter who has fallen out of favor with al Shabaab, demonstrate how al Shabaab’s turning a blind eye to Qat distribution in Somalia for the purpose of taxation has called into question the group’s committment to al Qaeda’s ideology and Sharia law.

  • Opportunity Costs – When al Qaeda is dedicating more time, manpower and resources to illicit fund generation, they are spending less time recruiting and training new operatives, planning operations and executing attacks.”

Also, @el_Grillo1 made a point which I overlooked in the FPRI post.  Another detractor of illicit revenue generation for al Qaeda groups is the scrutiny brought on terrorists by law enforcement and the military when they conduct illegal activities like kidnapping and drug smuggling. An important point that I overlooked in the FPRI post.  Here is a quick chart I put together showing the relative value of illicit funds to donor provided dollars.



AQIM Fractures: New Leaders & New Money in the Sahel

For several weeks there has been rumbling of  al Qaeda in the Islamic Maghreb (AQIM) fragmenting in the Sahel.  This morning, All Africa reports:

Former Al-Qaeda in the Islamic Maghreb (AQIM) emir Mokhtar Belmokhtar (aka “Laaouar”) quit the group to assemble his own band of suicide bombers in northern Mali. …The Algerian terrorist (real name Khaled Abou El Abass) reportedly left AQIM after his demotion as head of the El Moulethemine katibat (“Brigade of the Veiled Ones”)

It appears Belmokhtar wants to create his own terrorist group, which I imagine will compete with AQIM for recruits, turf, weapons and money.

The new terrorist group “is headquartered in the Malian city of Gao, which is under the control of Islamists from the Movement for Tawhid and Jihad in West Africa (MUJAO), an offshoot of AQIM”….Through the creation of the new group, Belmokhtar wants “to help to consolidate Sharia rule in northern Mali, where armed Islamists are enforcing Islamic law very strictly after having driven the Malian army out in the spring,” the French daily added… Belmokhtar will finance his activities “including the purchase of weapons” by “specialising in the kidnapping of Westerners, whom he usually frees in return for large ransoms”.

So why would Mokhtar, a long-time leader of AQIM, break from the group that according to ‘Western analysts’ is becoming so strong?  Much of the recent counterterrorism analysis I have read suggests that ransoms from kidnappings, foreign fighters moving to the Sahel, weapons from Libya’s collapse has all led to unity and strength in AQIM.  But is that the case, the All Africa article suggests something different.

“One of the reasons for this dissent is the disagreement between these leaders over how to share the ransoms paid for the release of Western hostages,” said Abdalahi Ould Ahmed, editor-in-chief of the daily newspaper Chouhoud….”As the organisation has grown and incorporated fighters of different origins, conflicts of interests have become increasingly frequent,” he added….Journalist Hamid Fekhart argued that “Droukdel’s decision was motivated by the unruliness of his junior, who is thought to have been gunning for him over the past few months. Security sources say that the supreme leader, who tried in vain to bring Mokhtar Belmokhtar to heel, simply decided to relieve him of his duties as part of a bid to reorganise AQIM.”…Fekhart noted that his successor, thirty-six year old Abou El Hammam, was reportedly “behind the kidnapping of an Italian-Burkina Faso couple in the Sahel in December 2010”.

Well, it looks like more money and fighters has led to more conflict than unity in AQIM.  Analysis suggesting more of any one terror group input (Weapons, money, fighters, etc) will lead directly to a stronger collective whole (AQIM) naively ignores the one thing that is most difficult to quantify and analyze: Human nature.

Concurrent to recent discussions of the rise of Shabaab (February-ish 2012), AQAP in Yemen (May-ish 2012) and then AQIM (Summer-ish 2012) has been the notion that al Qaeda’s ideology continues unabated, stronger than ever, and remains a binding tie that overides petty disputes within the terror group over leadership and resources.  GARBAGE! Ideology and money go hand-in-hand for al Qaeda.  Money without ideology turns AQ affiliates into little more than organized criminal groups.  Ideology without money, over time, renders al Qaeda nothing more than a poorly resourced cult drowned out by better financed Muslim Brotherhood affiliated organizations.  As Gregory Johnsen noted in his book on AQAP, what separated Bin Laden and al Qaeda from other militant groups was that:

“Bin Laden talked less than others, but he planned more.  And he had something no one else had: money.”

In June, I argued that the al Qaeda of 9/11/2001 really does not exist today.  One of the reasons I pushed this theory arises from the new state of acquisition and allocation of resources amongst al Qaeda affiliates.  Across al Qaeda’s global footprint, decentralization has led to there being more incentive for affiliates to compete than cooperate.  With Bin Laden’s death, donors spread their funds more diffusely and local affiliate illicit revenue schemes must increase. Ultimately, this change leads to al Qaeda affiliates with waning allegiance to al Qaeda Central.  As I noted in July,

As money transfers shift, influence, authority and strategic direction will drift.

For counterterrorists, Belmokhtar’s defection will hopefully prove to be instructive.  How do we replicate the conditions that led to Belmokhtar’s creation of a competing terror group?  In some cases, infrequent but well calculated drone strikes on key AQ leaders, I believe, can be very effective.  However, I think in the end it might be subtle, indirect actions that help exploit these factors.  What if the French or Germans were to only pay kidnapping ransoms to one leader of AQIM as opposed to another?  Could we use the unfortunate action of having to pay ransoms as a method/opportunity for creating dissension in the ranks of a loosely formed al Qaeda coalition?  Maybe.

al Qaeda’s Stronger Again Today – Unstoppable In Fact – AQIM, AQAP

Special thanks to Bloomberg and James Walcott for their misleading article title, “Al Qaeda Affiliates Getting Stronger, Says U.S. Official.”  Walcott goes on in the article to explain that David Cohen, U.S. Treasury Department Undersecretary for terrorism and financial intelligence, attended a London conference at Chatham House (where they apparently didn’t follow Chatham House rules) discussing the fundraising of al Qaeda affiliates.  Thank you James Walcott for the alarming title with little details.

Perfect timing for this blog as the article arose the same time I was compiling the results of the “One Year After Bin Laden” question which asked voters which al Qaeda affiliate would get al Qaeda’s donor support after Bin Laden’s death.  David Cohen said:

“The U.S. government estimates that terrorist organizations have collected approximately $120 million in ransom payments over the past eight years,”

To me, this isn’t that much money.  This equates to $15 million per year spread across numerous al Qaeda affilaites.  As I argued in January this year and a couple years back with regards to AQIM’s kidnapping schemes (and here), this illicit funding comes with all sorts of challenges.  Additionally, the “terrorism is cheap” argument propagated after 9/11 focused solely on the costs of executing a single al Qaeda attack while ignoring al Qaeda’s significant fixed and operational costs on a year-on-year basis.  While the article addresses how these ransoms are used for daily operations, the account doesn’t address how difficult and costly it is to operate in the middle of the Sahel (AQIM) or actually provide governance in rural Yemen (AQAP).  Both are costly enterprises I noted in January.

The misleading article goes on a confusing spiral guaranteed to scare and confuse a reader.

“Al-Qaeda’s core is not in the position to provide generous funding to its affiliates, such as al-Qaeda in the Lands of the Islamic Maghreb, ‘AQIM,’ operating in the Sahel, and al-Qaeda in the Arabian Peninsula, ‘AQAP,’ operating primarily in Yemen,” Cohen said. “Instead, these al-Qaeda offshoots are self-sufficient, raising their own funds and themselves providing support to the next generation of violent groups.”

“AQIM, the al-Qaeda affiliate that has likely profited most from kidnapping for ransom, has collected tens of millions of dollars through KFR operations since 2008,” he said. “It raised significant funds from kidnapping for ransom operations in early 2012, and was holding nine hostages as of the middle of last month.”

So al Qaeda’s affiliates are stronger because they don’t get donor funding from AQ’s core?  That doesn’t make sense. Being self-sufficient may make an al Qaeda affiliate independent in its operations and target selection, but self-sufficiency doesn’t necessarily make a group stronger; especially if a group, like AQIM gets involved with a fringe AQ upstart that kills a U.S. Ambassador without having sufficient local popular support.  This sort of self-sufficiency may actually represent weakness depending on the U.S. response.  Time will tell.

Additionally, this article mirrors the argument made by the AFRICOM commander General Ham earlier this year where he noted that AQIM remains the best financed al Qaeda affiliate.

In conclusion, if you read mainstream media accounts of al Qaeda, I believe you’ll be persistently confused.  In February, a casual reader would have thought al Shabaab, having officially joined al Qaeda, was on the brink of taking over the Horn of Africa and leading al Qaeda into a new era.  Today, al Shabaab defectors leave by the hour and the group’s safe haven continues to shrink as they move from conventional operations to more limited-resource guerilla tactics.

In May, news reports anointed AQAP as the new al Qaeda Central as they held territory and governed parts of Yemen. Today, the Yemeni government continues to push back AQAP and drone strikes from the U.S. engage and eliminate more and more key AQAP leaders.

So now in October, a month after the Benghazi tragedy, we are reading new hype about AQIM being the next “Getting Stronger” al Qaeda threat to challenge the U.S.  Really?  Are we in the counterterrorism punditry and media just looking for a new enemy?  Was anyone really tracking AQIM’s revenues in 2008 when they were doing kidnappings and likely receiving donations from AQ Central?  They may in fact have less resources if we could actually gain enough data to properly evaluate this question. But that story doesn’t sell advertising.  So yesterday, today and tomorrow, we’ll see that al Qaeda is “getting stronger” as we wildly pivot from one alleged al Qaeda affiliate to another.  Despite the fact we can’t even agree on what al Qaeda is or who is in the organization.  Terrorism and counterterrorism: two industries trying to find their way ten years after the attacks of 9/11/2001.

For those that continue to charge there is an al Qaeda and it continues to get stronger by the day, I ask but one question: “Under what conditions would you declare al Qaeda defeated?”  If you can’t describe those conditions when al Qaeda is defeated, then why should we listen to your analysis that al Qaeda is stronger?

My take is we should stop seeking a link between all violence in the Middle East and the subsequent labeling of it as “al Qaeda”. Again this week, @gregorydjohnsen and I were discussing the random al Qaeda linking occurring in the news between an AQAP attack on a Yemeni security official at the U.S. Embassy in Sana’a and the Benghazi attacks.  Garbage!  Continuing on this path will lead the U.S. to over-reach in its response and improperly assess threats – at a time when cyberattacks from state adversaries and criminals, not al Qaeda, may actually be the greatest threat to our national security. Analyze each attack or threat as its own entity instead of forcing everything into a dated understanding of al Qaeda 2001.


AQAP in Yemen Getting the Money After UBL – 1 Year After Bin Laden – Poll Results #4

In my opinion, one of the most critical questions after the death of Osama Bin Laden was where would donor funding to al Qaeda go after the death of the group’s leader?  Last year, after Bin Laden’s death, voters (40%) forecasted that Gulf donor funds would shift to AQAP in Yemen.  However, an interesting contrast occurred with ‘Private Sector’ voters, who using their experience with business and money, noted that it may instead be “Emerging Islamist Groups in North Africa amongst the Arab Spring” that receive a boost in funding.  Another interesting finding from the spring of 2011 was from the week prior to Bin Laden’s death where voters believed funding would remain focused on supporting al Qaeda in Afghanistan and Pakistan.  The implication of these two forecasts appeared clear: Bin Laden was central to drawing donor support from the Gulf.  For the full results of last year’s forecast, see this link.

A year later, on May 2, 2012, I asked the following question:

Since Usama Bin Laden’s death, the largest portion of Gulf donor contributions to extremism have gone to:

  • al Shabaab in Somalia to create an alternate safe haven for AQ
  • AQ in Iraq to counter Iraq’s Shia dominated government
  • AQ in Pakistan & the Taliban in Afghanistan/Pakistan to sustain AQ Central
  • AQAP in Yemen as a more viable group proximate to the Gulf
  • AQIM to help them exploit North African insecurity
  • Islamist groups vying for power amongst North African uprisings
  • Other

Overall, ‘AQAP in Yemen’ received the most votes across the board (40%) and the majority of every professional group.  After AQAP in Yemen, just under 20% of voters voters selected ‘AQ in Afghanistan and Pakistan’ and ‘Emerging Islamist Groups in North Africa’ –  an interesting result that concurs with the forecasts of the ‘Private Sector’ voters last year.  Essentially, voters thought the investment in an emerging al Qaeda affiliate was of equal value to backing the old original leaders of al Qaeda in Pakistan.  Here are the results for each professional category across all groups surveyed.  I went with raw vote totals for this graph and the vote totals and percentages for all demographics is below in a table.

In the following table, I’ve totaled the votes of each demographic for each terror affiliate and percentage of votes from each demographic breakdown selecting each terror affiliate.  In green I’ve highlighted a couple demographic breakdowns where the voting pattern is slightly different and higher with regards to ‘AQAP in Yemen’.

  • ‘Academia’ was more likely than the average and more likely than other professional groups to select ‘AQAP in Yemen’. ‘Academia’ was also less enthralled with ‘Emerging Islamist Groups’ than other professional groups.
  • Likewise, those that chose ‘Newspapers’ as their primary information source also selected ‘AQAP in Yemen’ at a slightly higher rate than the average.  This also makes me wonder if newspapers have been reporting on AQAP in Yemen more than other threats.  Don’t know, just a theory.

Highlighted in yellow are lines where votes were lower than average for AQAP.

  • Military voters selected ‘AQAP in Yemen’ less than any other group.  In fact, ‘Military’ voters selected ‘AQAP in Yemen’, ‘AQIM in Sahel’ and ‘AQ in AFPAK’ at roughly the same rate.  Maybe they know something the rest of us don’t know.


AQ Fundraising Decreased – 1 Year After Bin Laden Poll – Results #3

On the day of Bin Laden’s death, May 2, 2011, two of the options provided to survey respondents of the question “What will be the chief consequence of Osama Bin Laden’s death?” related to al Qaeda’s financing.  Essentially, would the terror group’s funding rise or decline with the loss of its key leader and chief financier.  Here were the results of the two options in the days immediately following Bin Laden’s death:

  •  “al Qaeda fundraising increases substantially” – only 1 ‘Government’ voter from a total of 152 responses selected this as the chief consequence.

For the full results of this question from 2011, see this post.

A year after Bin Laden’s death, (May 2, 2012) 209 respondents answered this question:

“Since Usama Bin Laden’s death, has al Qaeda fundraising increased of decreased?”

Overall, almost 80% of respondents said al Qaeda’s financing had decreased in the year since Bin Laden’s death while the remaining 20% believed al Qaeda’s financing had increased in the year since Bin Laden’s death.  In comparison, voters, on average, were more likely to believe al Qaeda’s funding had decreased (80%) than al Qaeda’s attacks had decreased (70%).  But according to the crowd, both have declined.

The following chart shows the breakdown of votes by percentage of each professional group. Again, a note of caution, some professional groups had only a small number of respondents so the percentages may appear artificially large.  Below the chart is a table which breaks out the raw vote totals by demographic group.  Here’s what I found interesting about the professional groups:

  • ‘Government Contractors’ were more likely than ‘Military’ voters to select “fundraising increased”.
  • Those that did not declare their professional background and ‘Academia’ were most likely to say that al Qaeda’s funding had decreased since Bin Laden’s death.

After examining the professional groups, I broke down the responses of each group by education level, preferred information source and residency.  In the last set of results (#2), the preferred information source of respondents appeared to correlate with respondents’ interpretation of an increase or decrease in al Qaeda attacks.  In these results (#3), I found the following vote breakdown to be of the most interest.

  • For education level, those with Doctoral degrees were more inclined than other education levels to believe that al Qaeda funding had increased since Bin Laden’s death.
  • The comparison of residency provided the most interesting results for comparison.  Those ‘born outside the U.S.’ or currently ‘residing outside the U.S.’ were the most likely to believe al Qaeda’s funding has decreased since Bin Laden’s death.  Meanwhile, those individuals that have lived cumulatively outside the U.S. and E.U. for two years or more were slightly more likely than average and twice as likely as those currently residing outside the U.S. to believe al Qaeda’s fundraising has increased in the year since Bin Laden’s death.  A strange paradox that I need to spend a little more time researching, but interesting nonetheless.

Here’s the full breakdown in a table.  In yellow are lines that I marked as interesting for being higher than average and in green are lines I marked as interesting for being lower than average.