LIBYA: Did the rebels set up a Central Bank to launder Al Q’eida money?

Clearly the Libyan Opposition is more sophisticated than we thought


The minute they’d broken out of Benghazi and started heading toward’s Gadaffi’s Tripoli four weeks ago, the Libyan rebels decided to get their post-revolution house sorted in readiness for kicking the mad dictator out. So naturally, they set up a Central Bank. The way you do.

American finance commentator Robert Wenzel writes in the US Economic Policy Journal:

“I have never before heard of a central bank being created in just a matter of weeks out of a popular uprising. This suggests we have a bit more than a rag tag bunch of rebels running around, and that there are some pretty sophisticated influences.”

You can say that again. Within days of the sitting-on-car-bonnets-firing-guns-in-the-air behaviour that is so de rigueur in North Africa these days, the Interim Ruling Council issued this press statement:

‘ We announce the designation of the Central Bank of Benghazi as a monetary authority competent in monetary policies in Libya, and the appointment of a Governor to the Central Bank of Libya, with a temporary headquarters in Benghazi.”

It’s all very odd. The next sight on our news screens could be Libyan protesters supporting Jim O’Neill’s candidature as head of the Libyan MPC. Or an unruly demonstration featuring placards that demand ‘An end to crypto-socialist regulation NOW’.

Of course, the minute something odd happens in the world, the conspiracy theories multiply like mosquitos round a stagnant pool. The favourite one on the American lunatic fringe this week is that the whole Libyan uprising is a Goldman plot designed to create a haven safe from international banking regulation. But not, presumably, free of folks firing guns at the ceiling if you won’t give them a loan.

All the same, the press statements begged investigation, and so The Slog dug around a bit.

I’m clearly a bit behind the music on this one, because last March 22nd Bloomberg carried a story pointing out that the rebels (once their day job of firing at the weather was through) had also set up a replacement for the Libyan national oil company. Cue a thousand conspiracy stories saying “So it’s all about OIL!”, but this seems very doubtful: in the league of black-gold producers, Libya is pretty third division.

Your international terrorist these days – by which I mean the effective ones, as opposed to the dingbats messing with chemicals in Britain’s kitchens – like to present themselves as freedom-fighters holed up in caves. Nothing could be further from the truth: atrocities are expensive, and in order to fund them you need access to the right laundry facilities. There is no better way of doing this than owning the Central Bank of a country – it is, you might say, a licence to reprint money.

When Gadaffi screamed from his balcony last month that “this is all the work of Al Q’eida”, he did the terrorist group an enormous favour, because most people immediately thought, “Gadaffi said it and he’s mad, so it must be bollocks”. And indeed, the rebels now hailing the last rockets Britain may ever fire in anger get very sensitive whenever the Bin Laden connection is mentioned. There is much talk of ‘a tiny minority’. Beware talk of tiny minorities.

Osama Bin Laden is a highly intelligent man who comes from a fabulously wealthy family. He is extremely well connected to oil and financial interests throughout the Middle East and Switzerland. As long ago as 2006, Congress was quizzing Swiss banks about their links to (and laundering of) Al Q’eida monies. UBS in particular was implicated at the time, and Barclays in the US have already admitted (and been fined for) knowingly handling Bin Laden money.

There is a great deal of ignorance about Al Q’eida in the West, a situation exacerbated by the security services using Bin Laden as an Islamist bogey-man. In fact, the group remains very loose (it has to be in order to escape penetration). Bin Laden himself is a megalomanic fantasist with bizarre dreams of being an Arabian Emperor; he embraces the fundamentalist hair-shirt drivel as a means to this end, but the truth is he was brought up with money, and he understands it very well – in much the same way as, on the quiet, he is something of a geek about pcs, mobiles, satnav and so forth. Che Guevara he isn’t.

The U.S. Commander of NATO forces recently admitted to the Senate that hints of Al Q’eida involvement have been detected among the rebels. The Day Two desire to set up a clearing house for blood money points my nose firmly in the direction of a heavier Al Q’eida involvement than the West as yet understands. Further compelling evidence in support of this hypothesis is can be gauged from one additional factor: the FCO, William Hague and David Cameron all think we’re supporting the right people. And they’re always wrong about everything.