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Al-Qaeda's Financial Pressures

Introduction

In addition to the ongoing military campaign against al-Qaeda, financial regulators are beefing up efforts to cut the terror group's lines of funding. These efforts are showing signs of progress. In Europe, al-Qaeda recruits complain of being forced to pay for their own training and supplies; affiliate cells are recording video and audio messages to solicit cash from supporters; and senior al-Qaeda leaders are calling on donors to ramp up illicit contributions (MailOnline). In mid-2009, al-Qaeda's commander of operations in Afghanistan, Mustafa Abu al-Yazid, complained of a shortage of food, weapons, and supplies (Reuters) brought about by a dearth of cash.

Analysts are split on whether global financial woes or a weakened brand are responsible for al-Qaeda's declining reserves. And some analysts downplay the importance of any financial weakening of al-Qaeda. For one, terrorism is cheap: The London transit bombings on July 7, 2005, only cost about $15,000. As al-Qaeda increasingly connects to affiliates in Somalia, Yemen, and elsewhere, the wealth of al-Qaeda central may also be of less consequence. An increase in criminal activities like smuggling and drugs could easily turn around the group's fortunes, analysts say.

Still, David S. Cohen, assistant secretary for terrorist financing at the U.S. Treasury Department, insists that targeted efforts to dampen al-Qaeda's finances are working. "We assess that al-Qaeda is in its weakest financial condition in several years," Cohen said in October 2009. "As a result, its influence is waning."

Historic Sources of Support

Despite lucrative business interests and a wealthy Saudi family, Osama bin Laden is not believed to have personally financed the creation of al-Qaeda. According to the 9/11 Commission report, by the time bin Laden arrived in Afghanistan in the mid-1990s, he had been...

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