Fruit Giant Chiquita Brands Guilty of Paying Terrorists

Chiquita Brands International Inc., a multinational supplier of fruit and vegetables, pleaded guilty in the U.S. District Court for the District of Columbia to one count of engaging in transactions with a designated global terrorist, according to the U.S. Justice Department.

Chiquita pleaded guilty pursuant to a written plea agreement. Under theterms of the plea agreement, Chiquita's sentence will include a $25 million criminal fine, the requirement to implement and maintain an effective compliance and ethics program, and five years' probation.

Chiquita also has agreed to cooperate in an ongoing investigation. Sentencing will occur on June 1.

The plea agreement arises from payments that Chiquita had made for years to the violent, right-wing terrorist organization United Self-Defense Forces of Colombia -- an English translation of the Spanish name of the group, "Autodefensas Unidas de Colombia" (commonly known as the "AUC"). The AUC had been designated by the U.S. government as a Foreign Terrorist Organization ("FTO") on Sept. 10, 2001, and as a Specially-Designated Global Terrorist ("SDGT") on Oct. 31, 2001. These designations made it a federal crime for Chiquita, as a U.S. corporation, to provide money to the AUC. In April 2003, Chiquita made a voluntary self- disclosure to the government of its payments to the AUC, giving rise to this investigation.

"Like any criminal enterprise, a terrorist organization needs a funding stream to support its operations. For several years, the AUC terrorist group found one in the payments they demanded from Chiquita Brands International. Thanks to Chiquita's cooperation and this prosecution, that funding stream is now dry and corporations are on notice that they cannot make protection payments to terrorists," says Assistant Attorney General Kenneth Wainstein.

"Funding a terrorist organization can never be treated as a cost of doing business," says U.S. Attorney Jeffrey Taylor. "American businesses musttake note that payments to terrorists are of a whole different category. They are crimes. But like adjustments that American businesses made to the passage of the Foreign Corrupt Practices Act decades ago, American businesses, as good corporate citizens, will find ways to conform their conduct to the requirements of the law and still remain competitive."

Following the company's disclosure, the investigation leading to this prosecution developed evidence that for over six years -- from sometime in 1997 through Feb. 4, 2004 -- Chiquita paid money to the AUC in two regions of the Republic of Colombia where Chiquita had banana-producing operations: Uraba and Santa Marta. Chiquita made these payments through its wholly owned Colombian subsidiary known as "Banadex." By 2003, Banadex was Chiquita's most profitable operation. Chiquita, through Banadex, paid the AUC nearly every month. In total, Chiquita made over 100 payments to the AUC amounting to over $1.7 million.

For several years Chiquita paid the AUC by check through various intermediaries. Chiquita recorded these payments in its corporate books and records as "security payments" or payments for "security" or "security services." Chiquita never received any actual security services in exchange for the payments.

Beginning in June 2002, Chiquita began paying the AUC in Santa Marta directly and in cash according to new procedures established by senior executives of Chiquita. The newly-implemented procedures concealed the factthat Chiquita was making direct cash payments to the AUC.

The U.S. government designated the AUC as an FTO on Sept. 10, 2001, and that designation was well-publicized in the American public media. TheAUC's designation was even more widely reported in the public media in Colombia, where Chiquita had its substantial banana-producing operations. Chiquita also had specific information about the AUC's designation as an FTO through an Internet-based, password-protected subscription service that Chiquita paid money to receive. Nevertheless, from Sept. 10, 2001 through Feb. 4, 2004, Chiquita made 50 payments to the AUC totaling more than $825,000.

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Islamic Charity and Five Individuals Indicted

The U.S. branch of an international Islamic charity and five of its officers, employees or associates have been indicted for illegally transferring funds to Iraq, laundering money, stealing federal funds, and obstructing tax laws by, among other things, falsely denying that a procurement agent of Osama bin Laden had been an employee of the charity, Assistant U.S. Attorney General for National Security Kenneth Wainstein, U.S. Attorney for the Western District of Missouri Bradley Schlozman, and Assistant Director of the FBI's Counterterrorism Division Joseph Billy announced.

The charity named in the 33-count indictment is the Islamic American Relief Agency (IARA), formerly known as the Islamic African Relief Agency-USA. IARA is an Islamic charitable organization headquartered in Columbia, Mo., that was officially formed in 1985 and closed in October 2004, when it was identified by the U.S. Treasury Department as a specially designated global terrorist organization, the Justice Department says.

Also charged in the indictment are Mubarak Hamed, 50, of Columbia, Mo., a naturalized U.S. citizen from Sudan who served as executive director of IARA; Ali Mohamed Bagegni, 53, formerly of Columbia, Mo. and currently of Iowa City, Iowa, a naturalized U.S. citizen born in Libya and a former member of IARA's board of directors; Ahmad Mustafa, 54, of Columbia, Mo., a citizen of Iraq and a former fund-raiser for IARA; Khalid Al-Sudanee, 55, a citizen and resident of Jordan and the regional director of the Middle East office of the Islamic African Relief Agency (also known as the Islamic Relief Agency, or ISRA); and Abdel Azim El-Siddiq, 50, of Palos Heights, Ill., a naturalized U.S. citizen born in Sudan and formerly vice president for international operations for IARA, the Justice Department says.

"Today's indictment paints an alarming picture of theft, money laundering, and fraud by the U.S. branch of an international charitable organization. These charges demonstrate our resolve to thoroughly investigate and prosecute any charities that abuse their tax-exempt status to engage in wide-ranging criminal activity," says Wainstein.

"The FBI will continue to work closely with our law enforcement andintelligence community partners to ensure charitable donations are notmisused for criminal purposes," says Billy.

The indictment, which was returned under seal by a federal grand jury in Kansas City, Mo., on Tuesday, March 6, was unsealed and made public upon the arrest and initial court appearance of several co-defendants, the Justice Department says.

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