Roots and trends of Saudi terrorism financing, report prepared for UNSC dated 19 Dec. 2002, still worth reading. [read more]

"The al-Qaida organization defies the common understandings of traditional terrorism by being able to hide terror behind a visible, mostly legitimate, business cover, using and abusing tools and methods that constitute the basis of Islamic banking, religious donations and modern economic globalization to move and raise money, recruit and train operatives, buy arms and entertain local operational cells able to carry out terrorist attacks around the world. 

At the root of that situation is an unresolved dilemma that turned to a confusion between religion and finance in the Kingdom of Saudi Arabia. By mixing religious beliefs, tools and interpretations with financial purposes, without proper regulations and controls, Saudi Arabia opened an avenue for terrorism financing through the traditional Zakat, a legal almsgiving conceived as a way for purification by the Prophet that turned into a financial tool for terrorists. 

Abusing this pillar of Islam and benefiting from the Saudi regulatory vacuum, al-Qaida was able to receive between $300 million and $500 million over the last ten years from wealthy businessmen and bankers representing about 20% of the Saudi GNP, through a web of charities and companies acting as fronts, with the notable use of Islamic banking institutions. Most of this financial backbone is still at large and able to support fundamentalist organizations."