August 14, 2003
New York Gem Dealer Arrested In FBI Missile Sting
Yehuda Abraham, 76, president of Ambuy Gem Corp., was arrested Aug. 12 and charged with operating an unlicensed money transmitting business in connection with a plot to sell a shoulder-fired Russian antiaircraft missile capable of downing commercial airliners for use by terrorists. The arrest was made at Abraham's office at the 580 Fifth Avenue building on the corner of 47th Street in New York City. He was arraigned Aug. 13 in federal court in Manhattan. Bail was set at $10 million.
Moinuddeen Ahmed Hameed, 38, an Indian citizen living in Malaysia, was also arrested yesterday at Ambuy's offices on similar charges. The arrests were made in connection with a Federal Bureau of Investigation sting operation that also captured Hemant Lakhani, an Indian-born British citizen described as a significant international arms dealer by the U.S.. He is charged with attempting to provide material support and resources to terrorists and acting as an arms broker without a license. Hameed and Lakhani are being held without bail.
In the sting operation that led to the three arrests, an FBI undercover agent posed as a buyer looking to obtain portable missiles capable of bringing down commercial airliners. Lakhani brokered the sale with Russian suppliers who were actually Russian government agents working with the FBI. Abraham is accused of accepting an initial downpayment on the missiles on Lakhani's behalf of $30,000. Hameed was brought into the plot to help launder an additional $500,000 payment for 50 more missiles.
In the Aug. 11 criminal complaint filed against Abraham in U.S. District Court in Newark, NJ, the FBI says Abraham met with its undercover agent at his Fifth Ave. offices in October 2002, where he counted out the money before taking it. Subsequent taped conversations between the FBI agent and Lakhani recorded the arms dealer reassuring the agent that Abraham would transfer the $30,000 to Lakhani in London through an untraceable hawala money network. Hawalas provide low-cost money transfers to various Middle Eastern populations, particularly in areas where there are no formal financial services available.
Abraham's four children, his rabbi and about a dozen other supporters attended his Manhattan court appearance on Wednesday, but did not speak to reporters afterward, according to the Associated Press. His lawyer Larry Krantz, told U.S. Magistrate Andrew Peck that his client is in poor health. Arguing for a lower bail, Krantz noted the charge against Abraham does not say his client knew he was dealing with terrorists.
A report on the New York Times Web site said people who worked with Abraham on 47th Street described him as a grandfather, an observant Jew and a well-known proprietor. Their reaction was one of disbelief. "For a Jew to do something like that, I cannot believe it or understand it," a 49-year-old jewelry wholesaler told NYT. "He's a prominent member of our community. To do something like that is crazy."
The report also said "the world of the diamond district is a cash-rich one, where unset gems must often be purchased in cash, and where wealthy customers will often pay in bundles of bills." NYT also quoted a law enforcement official describing the diamond business: "Behind the bustling facade of the diamond district is a nebulous world of murky financial transactions where federal agents have long focused on money laundering and other crimes." Gem merchants acknowledged that large amounts of cash flow across international borders every day, but insisted that it is done in legal and documented ways.
Arms dealer Lakhani is not thought to be directly involved with al Qaeda or any other known terrorist group, federal officials say. Authorities also stressed there was no specific, credible threat to shoot down an airliner in the United States. But the understanding between Lakhani and the undercover FBI agent was that the missile needed to be capable of bringing down a commercial airliner to cause economic harm in the U.S. through a jihad, according to an FBI affadavit.
The Bush administration has issued warnings recently that terrorists might use portable missiles against commercial aircraft. Recent attempted or alleged attacks internationally on aircraft are believed to have been instigated by terrorist groups who either used or planned to use these missiles. The administration opposes legislation in the U.S. Congress, however, that would require the government to spend billions of dollars to outfit thousands of passenger planes in the U.S. with anti-missile technology.
by Peggy Jo Donahue