ISLAMABAD (Reuters) - Coalition and Afghan forces have arrested a currency dealer suspected of handling millions of dollars of Taliban cash as part of a widening campaign to block insurgent finances ahead of a security handover in 2014, officials said on Thursday.
The U.S. Treasury has accused Haji Mohammed Qasim of using his network of money transfer shops to help Taliban commanders send funds to fighters in southern Helmand Province, scene of some of the heaviest fighting of the 11-year war.
“I can confirm he was arrested during a joint operation conducted by Afghan and coalition troops,” Captain Dan Einert, a spokesman for ISAF, the NATO-led force in Afghanistan, said in an email. ISAF gave no further details.
Dealers in the currency market in the southern Afghan city of Kandahar said Qasim had been arrested by U.S. troops, Afghan police and intelligence officers who raided the exchange in October.
“The Americans won’t tell us where he is,” said Haji Kandiagha, the president of the exchange. “Everyone is angry about this, they don’t know what the Americans will do.”
As the United States and its allies withdraw the vast majority of their combat troops, Western officials are hoping to weaken the still resilient insurgency by disrupting its funding channels before Afghan forces assume full responsibility for security.
The Treasury imposed sanctions on Qasim and his Rahat money transfer company last week, adding him to a growing list of individuals subjected to a U.S. asset freeze on suspicion of facilitating Taliban payments. He was also accused of smuggling weapons and ammunition on behalf of the insurgents.
The Treasury had no immediate comment on the arrest.
Treasury officials in Washington made no reference to Qasim’s arrest in last week’s statement announcing the sanctions, which was issued in Washington.
The discrepancy appeared to underline the complexity of U.S. attempts to counter insurgent finance, which often involve multiple organisations conducting covert work.
U.S. officials believe the Taliban relies on a trust-based payment system known as hawala which is prevalent in much of the Islamic world, including Afghanistan and Pakistan.
The system allows customers to rapidly move large sums across borders outside the scrutiny of regulators.
Afghan hawala dealers say they are being unfairly targeted since they cannot be held responsible if Taliban sympathisers use their services without their knowledge. They also resent the fact that the Treasury does not publish the evidence it uses to justify imposing sanctions on individuals such as Qasim.
The Treasury says that as of early this year Qasim’s hawala company had received $500,000 of Taliban cash through his branch in the south-western Pakistani city of Quetta. The manager of the Quetta shop, Musa Kalim, was also sanctioned, but there was no indication he had been arrested by Pakistani authorities.
“As of late 2011, the bulk of Kalim’s hawala business consisted of transferring Taliban and smugglers’ funds,” the Treasury said in a statement. “Kalim also managed the transfer of funds from donors in the Gulf to support Taliban fighters.”
The Taliban leadership is believed to have adopted Quetta as a rear base after it was ousted by the U.S. military in 2001. Pakistan denies sheltering the Taliban.
The U.S. Treasury says Qasim served as a financial assistant to Mullah Naim Barich, the top Taliban commander in Helmand Province, the heartland of Afghanistan’s heroin industry.
Washington designated Barich as a major suspected drug smuggler on November 15, marking the first time a Taliban commander had been added to what is known as the “Kingpin” list.
The Taliban dismissed the “Kingpin” designation and said nobody from the movement was involved in narcotics trafficking.
Editing by Jon Hemming