Australian shopping cards funding terror acts

EXCLUSIVE: AUSTRALIAN Islamic militants are using readily available travel and retail gift cards to fund terrorist acts in Middle Eastern war zones.

Justice Minister Michael Keenan says there are now about 10 million active stored value cards in Australia, with a worth of more than $1.5 billion. Picture Gary Ramage

AUSTRALIAN Islamic militants are using readily available travel and retail gift cards to fund terrorist acts in Middle Eastern war zones.

The stored value cards can be loaded with up to $100,000 cash at a time in Australia and then redeemed overseas.

A report being released today by the federal intelligence agency AUSTRAC will warn of the growing use of stored value cards by terrorists and organised crime gangs.

AUSTRAC recently identified 12 cases of stored value card use it believes relate to terrorism financing.

They involve more than $170,000 being loaded onto cards in Australia and then being cashed in countries that border war-torn Syria, including Turkey, Jordan and Lebanon.

AUSTRAC has evidence of a further 66 suspicious transactions involving stored value cards being redeemed in countries considered high risk for terrorism financing or which are recognised transit hubs for terrorism.

Justice Minister Michael Keenan told the Herald Sun there are now about 10 million active stored value cards in Australia, with a worth of more than $1.5 billion.

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HOW IT WORKS

■ Prepaid stored value cards — including travel and gift cards — are readily available from most banks, credit unions, Australia Post and major retailers.

■ They can be loaded in Australia with cash, either in person when obtaining them or online remotely.

■ Many of them can be bought and loaded and reloaded with cash entirely online.

■ Some cards can only be loaded with relatively small amounts while others can have up to $100,000 stored on them.

■ They can be easily posted or carried offshore.

■ Funds can be redeemed through multiple overseas ATM withdrawals, restricted only by whatever the withdrawal limit is for that ATM.

■ Cards can be regularly reloaded remotely and anonymously by third parties.

■ There have been cases where funds have been loaded onto a card in Australia then immediately redeemed by a third party overseas.

■ Organised crime gangs buy gift cards in bulk and then resell them as a means of laundering money.

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The AUSTRAC report reveals users of stored value cards redeemed $2.2 billion in foreign countries in the 12 months to August 31, 2016.

“In Australia, foreign fighters have used stored value cards to fund their terrorist activity before and after departure to the conflict zone,” Mr Keenan said.

“Internationally, we have seen stored value cards used to fund terrorist attacks, including the horrific terrorist attacks in Paris in November 2015.”

“This AUSTRAC report serves as yet another tool to target and disrupt serious organised crime, including terrorist financing, and identify where preventive measures can be strengthened.”

AUSTRALIAN JIHADIS DRAW ON SUPER FUNDS TO HELP FINANCE MIDDLE EAST TERROR GROUPS

Justice Minister Michael Keenan says foreign fighters in Australia have used stored value cards to fund their terrorist activity. Picture: Gary Ramage

The AUSTRAC report also revealed:

STORED value cards — which include prepaid travel and retail gift cards — carry the highest level of vulnerability to misuse of any type of credit, debit or other cards assessed by AUSTRAC investigators.

USE of stored value cards to finance terrorism is expected to increase due to the worldwide introduction of tighter controls on other money moving methods.

GANGSTERS are using stored value cards to launder and move the proceeds of crime.

AUSTRAC has identified cases of people in Australia loading large amounts of money onto stored value cards — the identifying characteristics of the cards are then used by another person to immediately obtain the cash offshore.

“The most significant potential consequences of the criminal use of stored value cards is the threat to national and international security if used to facilitate terrorism financing, particularly enabling and sustaining the activities of foreign terrorist fighters” the AUSTRAC report said.

“Indeed, the Paris terrorist attacks of November 2015 demonstrate the significant harm that can be caused by funds stored on stored value cards.”

The AUSTRAC report said the investigation into the Paris attacks discovered a prepaid stored value card was used to rent the flats used by the terrorists, as well as to hire vehicles used in the attacks — in which 130 people died.

That card had been reloaded many times with individual reloads in excess of the equivalent of $1100 each time.

Police also discovered Salah Abdelsam, one of the terrorists involved in the Paris attacks, used an anonymous prepaid stored value card to move freely around Europe in the period between the attacks and his arrest in Belgium four months later.

Mr Keenan said recommendations in the AUSTRAC report included suppliers of the cards making them harder to get and significantly limiting the amount of cash they can store.

At least three stored value cards readily available in Australia can have up to $100,000 loaded onto them.

“The Coalition Government is committed to working with our law enforcement and intelligence agencies to protect Australia’s financial system by tracking and identifying dirty money — the lifeblood of criminal gangs — and other criminal acts, such as terrorism financing,” Mr Keenan said.

He said it had boosted AUSTRAC’s funding by $20 million, provided $127 million to establish a serious financial crime taskforce and contributed $15 million to the fraud and anti-corruption centre, which is led by the Australian Federal Police.

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