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Thursday, June 11, 2009

Hamas on defensive over investment scam that funded smuggling operation

GAZA CITY — The Hamas regime is under fire from Palestinian investors who charge they were cheated in an operation promoted by senior officials.   

Hamas has been accused of squandering $800 million in investments from everybody from businessmen to housewives in the Gaza Strip.

Palestinian sources said architects of the scam, backed by Hamas security officers, were forcing the investors to sign statements that they had received all of their money back.

"Hamas demanded that each investor sign a document that he received all his money, although he would obtain only 16 percent of his investment," the Palestinian Media Center said.


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The scam, acknowledged by the Hamas regime, was first reported in 2008. At the time, Hamas had encouraged investors to contribute to a fund that would expand the smuggling tunnel network with Egypt's Sinai Peninsula. The investment was expected to pay as much as 200 percent profit.

At one point, then-Interior Minister Said Siyam established two companies — one in Egypt and the other in Turkey — to invest the funds from Gazans. The sources said Hamas was making tens of millions of dollars per month from the smuggling trade.

But Siyam was killed during the 22-day war with Israel in January 2009 and investors found their money had disappeared. The Hamas regime first denied the investment scheme, and then security agents forced the contributors to forego their right to sue.

"The document commits the contributor to acknowledge that he received all his money," Palestinian Media Center, aligned with the opposition Fatah movement, said. "He also pledged that he would have no right to sue either in court or in tribal councils."

Hamas officials have acknowledged that at least $100 million was stolen in the scam, said to have been promoted by two entrepreneurs, Ihab Al Kurdi and Waeb Rubi. Officials said both men claimed that senior Hamas members, including Siyam, were involved in the investment scheme.

"Kurdi said he had good relations with people in government, but what they were selling was a lie," Hamas Economics Minister Ziyad Al Zaza, who is investigating the scam, said.

Revenue from the smuggling tunnels has dropped significantly since the Hamas-Israel war. Egypt has increased efforts to block the flow of smuggled goods to the Gaza Strip while Israel has enabled the arrival of daily humanitarian shipments.



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