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 Treasury Designates Islamic Extremist, Two Companies Supporting Hizballah in Tri-Border Area


6/10/2004

FROM THE OFFICE OF PUBLIC AFFAIRS

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One of the most prominent and influential members of the Hizballah terrorist organization, along with two of his companies, was designated by the Treasury Department today under Executive Order 13224. Assad Ahmad Barakat has close ties with Hizballah leadership and has worked closely with numerous Islamic extremists and suspected Hizballah associates in South America's tri-border area (TBA), made up of Brazil, Paraguay and Argentina.

"Today, we are designating a key terrorist financier in South America who has used every financial crime in the book, including his businesses, to generate funding for Hizballah," said Juan Zarate, the Treasury Department's Deputy Assistant Secretary for the Executive Office for Terrorist Financing and Financial Crimes. "From counterfeiting to extortion, this Hizballah sympathizer committed financial crimes and utilized front companies to underwrite terror."

Barakat is currently serving six and a half years in a Paraguay prison for tax evasion, and was detained in June 2002 by Brazil - at the request of Paraguay - on suspicion of tax evasion and criminal association.

On January 25, 1995, the Annex to Executive Order 12947 listed Hizballah as a Specially Designated Terrorist. The Department of State, in consultation with other agencies, designated Hizballah as a Foreign Terrorist Organization in 1997. Additionally, on October 31, 2001, Hizballah was designated as a Specially Designated Global Terrorist under Executive Order 13224.

Barakat has long served as a treasurer for Hizballah and has carried contributions to Lebanon for the group. Barakat is reportedly the deputy to a Hizballah financial director, Ali Kazan, and the primary liaison in the TBA for Hizballah's Secretary General Shaykh Hasan Nasrallah. As of late 2001, Barakat reportedly was traveling to Lebanon and Iran annually, meeting with both Nasrallah and Hizballah's Spiritual Leader Hussein Fadlallah. Nasrallah and Fadlallah were also named as Specially Designated Terrorists under E.O. 12947.

In addition, Treasury is designating two of Barakat's businesses, Casa Apollo and Barakat Import Export Ltda. Information available to the U.S. indicates Barakat has used wholesale import-export businesses as front companies for Hizballah activities and cells. Barakat used his electronics wholesale store Casa Apollo as a cover for Hizballah fund-raising activities and as a way to transfer information to and from Hizballah operatives. Barakat used his company, Barakat Import Export Ltd., to raise money for Hizballah in Lebanon by mortgaging the company in order to borrow money from a bank in a fraud scheme.

Barakat has used strong-arm tactics and coercive measures to raise large sums of money annually, which were sent to Hizballah in Lebanon and Iran. Barakat threatened TBA shopkeepers who are sympathetic to Hizballah's cause with having family members in Lebanon placed on a "Hizballah blacklist" if the shopkeepers did not pay their quota to Hizballah via Barakat.

Barakat has also been involved in a counterfeiting ring that distributes fake U.S. dollars and generates cash to fund Hizballah operations. As of early 2001, Barakat was one of two individuals reportedly in charge of distribution and sale of the counterfeit currency in the TBA.

Information obtained by the U.S. indicates that Barakat's personal secretary operated as Hizballah's military leader in the TBA and was reportedly arrested on October 3, 2001 at Barakat's business, Casa Apollo. Sobhi Mahmoud Fayad - a close associate of Barakat and possibly his executive secretary - is a known Hizballah member and weapons expert. A high-ranking Hizballah official in Lebanon in the 1980s, Fayad supports the terrorist organization in the TBA today. Fayad was arrested in 1999 for surveillance of the U.S. Embassy in Asuncion, and was arrested again in November of 2002 and sentenced to six and a half years for tax evasion.

Barakat has also served as the deputy financial director of the Husaniyya "Iman AI-Khomeini" mosque in Brazil. Barakat's arrest in June 2002 prompted a prominent member of the Mosque to prohibit anyone who is not a member of Hizballah from attending services.

Paraguayan authorities have recovered video of Hizballah military operations from a personal computer in one of Barakat's stores. The footage depicted the detonation of explosives, some of which show people dying from these explosions. Another file included Hizballah military orders for each town and village in southern Lebanon.

Barakat relayed information to and from Hizballah leaders in Lebanon and, at their request, sought sensitive information about the activities of Arabs in the TBA. In particular, Barakat procured information about Arab community members that traveled to the United States or Israel and transmitted that information to Hizballah's Foreign Relations Department in Lebanon.

Barakat has also regularly hosted and attended meetings of senior Hizballah TBA leaders. According to information available to the U.S. Government, Barakat attended a meeting of TBA Hizballah members in the fall of 2000 in Brazil where Hizballah members discussed their intentions to identify, locate and assassinate former members of the Army of South Lebanon and Israelis. The group also discussed a possible effort to oust Yasir Arafat due to his agreement to a cease-fire.

Assad Ahmad Barakat

Brazilian Residences as of January 2002
Rue Taroba 1005
Beatriz Menez Building
Foz do Iguacu, Brazil

Rua Rio Branco
Lote 682
Quadra 13
Foz do Iguacu, Brazil

Rua Xavier Da Silva 535
Edificio Martin Terro
Apartment 301
Foz do Iguacu, Brazil

Brazilian Residences as of January 2001
290, Rua Silva Jardim
Foz do Iguacu, Brazil

Chilean Residences
Arrecife Apartment Building
Iquique, Chile

Apartment 111
Panorama Building
Iquique, Chile

Paraguayan Residences
Piribebuy Y A. Jara
Ciudad del Este, Paraguay
Phone: 061-514-932

Casa Apollo

Galeria Page
Ciudad del Este, Paraguay

Barakat Import Export Ltd

Iquique, Chile
Tax Identification Number: AABA 670850 Y

-30-

 

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