DALLAS – Foreign bank accounts controlled by the Holy Land Foundation for Relief and Development (HLF) were never reported to the Internal Revenue Service or even to the charity's own auditors, a former bookkeeper for the charity admitted Wednesday.
Mohammad Wafa Yaish worked as a tax and accounting consultant for HLF from 1997-2001. He was called as a defense witness to give an overview of the different projects run by HLF and to discuss financial records.
Five former HLF officials are accused of illegally funneling millions of dollars to Hamas through a series of Palestinian charities called zakat committees. If HLF was raising money for Hamas, he didn't know about it, Yaish said.
During the prosecution's case, bank and tax records entered into evidence showed hundreds of thousands of dollars were unaccounted for. Other evidence and witness testimony showed the committees receiving money were run by people openly affiliated with Hamas.
Defense attorneys say HLF money went to genuine needs, such as schools, hospitals and to provide stipends for needy Palestinians.
During cross examination, federal prosecutor Barry Jonas pointed to records showing HLF had accounts with a series of foreign banks, including the Arab Bank, Bank of Palestine, and the Cairo Amman Bank, among others. But these accounts were never reported by the non-profit charity on its IRS forms.
Yaish said he saw no reason to inform IRS of the numerous transactions involving HLF's overseas bank accounts since they were "not bearing interest."
HLF hired an independent auditor to review its accounts, Yaish said. But the auditor was never given information about the foreign accounts.
Yaish also was asked about specific payments HLF made to zakat committees through the foreign accounts. No records of those payments were found inside HLF offices. "Shouldn't there be records in the HLF office that support these transactions?" Jonas asked. Those "records could have been lost," Yaish said.
HLF had proper accounting procedures in place, he said. He established an in-house accounting department to make sure all incoming revenues and expenditures were handled properly. He said he kept detailed ledgers of expenditures incurred under the different projects: social services, education, health, economic development, emergency relief and special programs (seasonal programs corresponding to the Muslim festivals of Ramadan and Eid). He also verified wire transfers of grants made to various organizations.
Jonas asked about a $1.6 million payment to the Islamic Charitable Society of Hebron. He claimed this was the "zakat committee that received the most money from HLF." Jonas referred to a July 17, 2001 letter addressed to Kamal al-Tamimi giving $5,000 to the Young Muslim Youth Association in Hebron "for the purpose of organizing a summer camp."
The Young Muslim Youth Association was connected to the Islamic Charitable Society of Hebron, a Hamas-controlled charity, Jonas said. Jurors were then shown a 2001 video (the same year as the letter from HLF to Kamal al-Tamimi) of a school funded by the Young Muslim Youth Association purportedly with HLF money. The video shows school children wielding fake rocket propelled grenades.
Jonas discussed application forms submitted to HLF regarding sponsorship of needy orphans. Yaish had earlier testified that the "orphan package" required information including the death certificate of the father, the birth certificate of the orphan, a report on the orphan's "situation" - why he needed the money, an orphan application, and a picture of the orphan. Jonas asked why the forms inquired about the father's cause of death and pointed out that several of the orphan applications seized from the HLF office listed "martyr."
HLF provided support to all needy orphans, Yaish said, including the children of martyrs. But some applications listed an orphan's status as "excellent" or "good." Those people should not have received money, Yaish said.
Jonas asked Yaish whether he knew that HLF was a part of the Palestine Committee in America, a group created by the Muslim Brotherhood to help Hamas politically and financially. It was responsible for the fund's general strategy, approving its work programs, budget, and other policies, including appointing the fund's board of directors.
Yaish said he didn't know about that.
"Should not have auditors been told that HLF was part of the Palestine Committee and this information reflected in the annual report?" Jonas asked. Yaish didn't answer.
Earlier this week, defense witness David McDonald testified about the songs and dances often performed at HLF fundraisers. McDonald, a professor of ethnomusicology and cultural anthropology at Indiana University, said that songs glorifying Hamas leaders and the organization itself needed to be viewed in a certain context and was not necessarily an endorsement of the terrorist group.
McDonald said he reviewed five complete videotapes featuring the band "al-Sakra," but saw "no indication" in their performances that the troupe was linked to Hamas. Violent themes depicted in several of the dance performances "are not peculiar to Hamas and are quite common across the political spectrum," he said.
Jurors were shown a1988 video in which performers wearing green headbands and carrying green Hamas flags shout slogans such as "Khaybar, Khaybar ya yahud. Jaish Mohammed soufa ya'oud!" ("O Jews of Khabar, the army of Mohammed is returning"). Khaybar, an oasis near Medina was inhabited mainly by Jews in the 7th century. In the year 628, Mohammed led the Muslims against it, killing the Jews in battle. The chant is considered a taunt implying that history will repeat itself.
But McDonald saw nothing incendiary in the message. The performance was a "reenactment of an Islamist demonstration." Music was used by the al-Sakra band to "communicate current events" and reference to "martyrdom" in the performances was "not associated with any particular ideology or group."
He described a 1988 skit starring defendant Mufid Abdelqader as a Hamas activist who ridicules an Israeli soldier and then stabs him in the end as a "dramatization of dialogue between an Israeli soldier and Hamas." He said this kind of "performative (sic) debate is really common in Palestinian folklore." In another video from the same time period McDonald explained the commentator's reference to Ahmed Yassin and Hamas merely was "about a current event. He is keeping the music current." The reference to Hamas leaders and the movement "marks the beginning of Hamas on the national scene" and signifies the "beginning of the Intifada."
"Ahmed Yassin is the new guy on the street and Hamas is the new movement," McDonald said. Such performances were representative of Palestinian folklore music and were routinely enacted at weddings and engagement parties.
McDonald noted there was a dramatic shift in al-Sakra's orientation from 1993 through 1996 that reflected "a move away from militant and revolutionary songs to more folklore music." However, that more peaceful tone disappeared when the second Intifada broke out in 2000. The music reverted to the revolutionary, militant type. McDonald said the shift reflected "people who are powerless trying to feel powerful through these performances."
Jurors were shown a videotape of a 2004 summer camp in Jenin. The videotape was made right after the Israeli troops had entered the West Bank, McDonald said. It featured a young Palestinian woman who glorifies becoming a suicide bomber: It is the "price that has to be paid to get back the homeland," she says. The woman acted in retaliation to the "humiliation" suffered living under occupation, McDonald said.
That included young women being subjected to "culturally insensitive searches" where they had to take off their head scarves and be patted down, in violation of their culture of modesty. Federal prosecutor James Jacks asked McDonald if the "culturally insensitive searches" were new security measures following a spate of suicide bombings by young women. Female suicide bombings were an example of "asymmetrical violence," McDonald said. But when asked later whether he would support suicide bombings, McDonald said no.
Near the close of the day's proceedings, Edward Abington, a former consul general at the U.S. consulate in Jerusalem took the witness stand. His testimony is expected to conclude Thursday.