Terror Watch: Antiterror Victory?

The U.S. government's campaign against alleged terror financiers has won a potentially important victory with a decision by Swiss prosecutors to pursue a formal criminal case against a prominent Saudi businessman long accused of providing support to Al Qaeda and other terror groups.

The businessman, Yassin al-Kadi, was first named by the U.S. Treasury Department as a "Specially Designated Global Terrorist" in October 2001 as part of a major campaign by the Bush administration to demonstrate it was cracking down on terror financiers in the aftermath of September 11. The U.S. action prompted a number of governments, including the Swiss, to freeze millions of dollars of Kadi's assets.

But his case also has raised serious questions about the strength of the U.S. government's evidence--little of which has ever been made public--regarding the murky world of terror-finance networks. Kadi, a top target of U.S. investigators, has repeatedly denied all accusations of terror ties. And more than three and a half years after he was first designated by Treasury, no criminal charges have been brought against him--either in the United States or anywhere else throughout the world where he does business.

That now may change. Earlier this month, in a move long sought by Washington, Swiss deputy federal prosecutor Claude Nicati asked a Swiss federal criminal tribunal to assign a juge d'instruction (investigative magistrate) to prepare a possible criminal case against Kadi.

Swiss criminal investigations proceed in three stages. In the first stage, prosecutors and police work together to gather the evidence for a criminal prosecution. In the second stage, an investigating magistrate sifts through evidence gathered by prosecutors, interrogates witnesses and decides (much as an American grand jury is supposed to decide) whether there is enough evidence to send the case for trial. In the third stage, the investigating magistrate would send the case to criminal-court judges--in Kadi's case, federal judges based in the southern Swiss city of Bellinzona--who would try it and determine whether the defendants were guilty of any crime. The Kadi case is the first terrorism-finance case that Swiss prosecutors have moved to the second investigative stage since 9/11.

According to Kadi's lawyer, Nicati's four-page letter to the federal tribunal focuses in particular on a series of transactions between February and August 1998 in which one of Kadi's companies, Caravan Development, transferred $1.25 million to a firm owned by another Saudi businessman, Wael Julaidan. Julaidan, a reputed one-time associate of Osama bin Laden during the guerrilla war against Soviet occupation of Afghanistan, was placed on both the United Nations and U.S. terror financier lists in September 2002.