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Argentina – Argentinean casino accused of laundering US$10m to finance Hezbollah

By - 16 July 2018

The Argentine government has frozen assets and money belonging to members of an organisation presumed to have ties to the Shiite terrorist organisation Hezbollah, following a manoeuvre to launder $10m in a casino in the town of Iguazú, in the area known as the Triple Frontier region, between Argentina, Brazil and Paraguay.

Authorities discovered that the members of the so-called “Barakat Clan” could have collected $10m in an Iguazú casino for alleged prizes and these funds were not declared when crossing the border. Faced with the suspicion of serious criminal activity related to the illicit origin of the funds and the hypothesis that, once out of the country, the money would be transferred by the cell to Hezbollah, the Government decided to freeze the funds.

The exchange of information on money laundering related to organised crime or terrorism financing allowed the Financial Information Unit (UIF) to obtain data in order to generate and send alerts to around 50,000 entities including banks, casinos, exchange houses and financial institutions. Alerts sent to entities asked that the government be informed if there had been any operations linked to the Barakat clan, led by Assad Ahmad Barakat. The cell centre of operations is based in Ciudad del Este and is involved in crimes related to the falsification of money and documents, contraband, extortion, arms trafficking, narcotics, terrorism financing and money laundering.

After detecting the manoeuvre in Iguazú, and based on the warnings coming from the United States and other financial intelligence agencies, the Government froze the funds and assets of 14 people linked to the Barakat cell in Argentina, who had used the border repeatedly to smuggle in cash via the Tancredo Neves international bridge, which connects Iguazú with Brazil.

The Tri-Border Area of Argentina, Brazil, and Paraguay, also referred to as the Triple Frontier, is host to significant activity by various terrorist groups and criminal organisations. Hezbollah has used the region for fundraising and training and as a means by which to carry out attacks in South America. In November 2017 Congressman Robert Pittenger, a strong supporter of Trump, travelled to Latin America to lead a major international forum on the growing link between radical Islamic terrorists and Latin American drug cartels. 300 Members of Parliament and security officials from fifteen South American nations attended the forum hosted by Congressman Pittenger. The forum was in a response to growing fears that Latin America is being targeted by terrorist organisations.

According to a Congressman Pittenger “Hezbollah is partnering with Latin American drug lords to raise money for terrorist activity. This includes participation in drug trafficking, gun running, and trade-based money laundering. The combination of radical Islamic terrorists and violent drug lords is a serious threat to national security,” he said.

Terrorism financing and the gaming industry in Latin America continues to be a major concern and there have been repeated calls by The Financial Action Task Force of Latin American (GAFILAT) to tighten rules in a number of jurisdictions in the region which are particularly vulnerable to the crimes of money laundering and financing of terrorist activities.

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