HAMAS'S USE OF CHARITABLE SOCIETIES TO FUND AND SUPPORT TERROR
(Communicated by the GPO)
Monday, September 22, 2003

In Hamas's worldview, dawa ("preaching" or "calling") plays an important
role in the organization's activities and is one of the more prominent means
by which it realizes its immediate goals: inculcating Islam among the
public, increasing public support for the organization and recruiting new
members.

Hamas's dawa is, in effect, the movement's infrastructure. It includes a
range of organizations that provide various services (welfare, education,
health, etc.) to the population, either for symbolic prices or free of
charge.

Charitable and social welfare activities are a significant part of Hamas's
dawa activities, since giving to charity is a fundamental principle of
Islam. These activities are carried out by network of dozens of charitable
societies and committees throughout Judea, Samaria and Gaza. While these
organizations provide services to the public at large, they grant preference
to those close to the movement and see to it that those in its favor receive
increased financial assistance.

Hamas's charitable societies and committees in Judea, Samaria and Gaza also
provide food and monetary assistance to the families of those who have been
killed and wounded in perpetrating acts of terror and who have been
imprisoned for their involvement in acts of terror. Such families typically
receive an initial, one-time grant of between $500-5,000, as well as a
monthly allowance of approximately $100. The families of Hamas terrorists
usually receive larger payments than those of non-Hamas terrorists. These
charitable societies and committees also provide the families with
scholarships and educational subsidies. The dawa groups also provide
financial assistance for the rebuilding of homes that have been demolished
due to their owners' involvement in terror.

The movement's network of mosques and Islamic preachers serve as a platform
for disseminating incitement against Israel, for encouraging suicide
terrorism, and for recruiting terrorists.

Hamas's charitable societies and committees in Judea, Samaria and Gaza also
provide aid to Palestinians who have been injured during the ongoing wave of
Palestinian violence in confrontations with Israeli security forces or
during "work accidents." This includes both initial grants and monthly
allowances potentially worth hundreds of dollars, depending on the status of
the injured person.

Those injured as mentioned above also enjoy medical care and treatment -
either subsidized or free - provided by the organization. Hamas also aids
its members who are imprisoned either in Israel or the Palestinian
Authority, as well as the imprisoned members' families. Released prisoners
receive generous release grants.

Hamas's dawa network turns the perpetrating of terrorist acts, including
suicide terrorism, as a means that, in effect, provides economic security
and certainty in the severe economic situation that the Palestinian
population currently finds itself in, and thus encourages the perpetrating
of such acts of terrorism. Hamas exploits the distressed economic situation
by creating financial dependence and the continued flow of new recruits out
of a sense of obligation. Moreover, funds designated for dawa have been
diverted directly to terrorists in order to fund attacks.

Hamas's wide-ranging activities among the Palestinian population have led to
its strengthening vis-a-vis the Palestinian Authority and have prevented the
PA from acting against it due to Hamas's support among the wider Palestinian
public. (Statements by senior PA officials last month to the effect that
they would monitor Hamas's bank accounts have not been followed up by any
action whatsoever.) Hamas is thus, in effect, preparing itself as an
alternative to the PA in the guise of its educational, social and medical
infrastructure.

Most of the funds for dawa activities are raised outside Judea, Samaria and
Gaza. These funds - $25-30 million per annum - form the lion's share of
Hamas's budget. Pro-Hamas Islamic charitable societies in Saudi Arabia, the
Persian Gulf emirates and in the west transfer funds to Hamas's charitable
societies and committees in Judea, Samaria and Gaza. Among these pro-Hamas
charitable societies are "The World Congress for Islamic Youth" and the
"World Islamic Organization" from Saudi Arabia; "Interpal" based in London
(which transferred $6 million in 2002); and the recently outlawed "Al Aqsa
Fund" based in Germany.

Interpal - This fund has continued to transfer money to Hamas in recent
months. In 2002, it transferred $6 million, of which between $3-$4 million
were used in Judea Samaria and Gaza. At the same time, the Interpal
leadership secretly turned to Arafat with a request for aid in funding its
activities, as they are very concerned about the possibility that they would
be closed down and that they themselves might suffer. The fund's leaders
asked Arafat and the Palestinian Authority to publicly support and sponsor
its activities; something which they believe would make it more difficult
for their organization to be harmed. It is yet unclear as to how the
Palestinian Authority has responded to this request, but despite
declarations to the contrary, the Palestinian Authority is not taking any
concrete steps against Hamas operations.

The Al-Aqsa Fund - This fund is mainly active in the Netherlands and Germany
and maintains smaller delegations, and holds bank accounts, in Denmark and
Belgium. The fund continues, albeit indirectly, to transfer hundreds of
thousands of dollars to Judea, Samaria and Gaza. In August 2002, the fund
was banned in Germany, which led to a significant increase in its activities
in Holland, where it raised approximately 600,000 Euros in 2002 and $650,000
in 2001. Presently, legal action is being taken against the fund. In
April-May 2003, preliminary steps were taken to freeze approximately 200,000
Euros. However, in August 2003 that money was returned to the fund after the
courts were not convinced that it was being used for hostile terrorist
activities.

Thus, Fund activists in the Netherlands continued to raise money but under
the guise of a seemingly new fund called ISRA, in order to make it harder
for its activities to be supervised. The Al-Aqsa fund has acted as a conduit
for funds channeled to Judea, Samaria and has cooperated with Interpal.

Lis Ben Khaled, 36, was arrested in Israel on 1.5.2003. Khaled, a French
national of Algerian origin and an activist for a pro-Palestinian charitable
organization, arrived in Israel with 11,000 Euros and contact details for
someone in Jenin. Khaled was questioned by the Israel Police, to which he
gave information regarding the activities of his offices, their connections
and money transfers. His organization has since been outlawed in the US due
to its involvement in terrorist activities.