Issue: In last night’s second presidential debate, John McCain said, “My friends, some of this $700 billion ends up in the hands of terrorist organizations.” (source: CNN.com)
Facts: OK, we admit to initially being stumped by McCain’s assertion that the bailout plan, for which he suspended his campaign and went to Washington to urge lawmakers to pass, was secretly helping terrorist organizations. (Transitively, does that mean that McCain was supporting terrorist organizations? Of course not.)
But there is a possible indirect link between the bailout plan for bad mortgages and terrorism. This from Diane Francis of The National Post in Canada:
In fact, an Assyrian news website carried a story back in mid-2007 that FBI and other officials were concerned about a “growing trend of terrorist associations [involved] with mortgage fraud rings in the U.S.”
“In the past year [2007], several high-profile mortgage fraud arrests have been tied to federal terrorism investigations, most notably a ring busted up in Salt Lake City that is alleged to have direct ties to the late al-Qaeda leader in Iraq, Abu Musab al-Zarqawi,” said the story.
Money was obtained from banks fraudulently then transferred to Middle Eastern bank accounts controlled by terrorists. These cases grind through courts.
The Assyrian news story began:
A man arrested in December at the Kansas City airport with $70,000 in his bulging pockets while trying to board a Southwest Airlines flight claiming the money was actually Muslim prayer books, a San Francisco mortgage company executive who went on the run from the FBI in November, seven people arrested in September in Salt Lake City with ties to al-Qaeda, and a co-defendant in the Sami al-Arian/Palestinian Islamic Jihad trial all have one thing in common — the growing trend of terrorist associations with mortgage fraud rings in the US.
(It must be pointed out that the Assyrian account lists Al-Arian co-defendant Sameeh Hammoudeh as part of this great mortgage fraud terrorism effort, a gross misrepresentation of the mortgage fraud charge he pleaded to in court. His fraud charges related to his concealment of his employment at the Islamic Academy, and not fraud in subprime mortgages. Oh, and Hammoudeh was not a terrorist, either.)
The UK, likewise, has suspicions that terrorists used bad mortgages:
An intelligence report by the Association of Chief Police Officers said that organised crime groups used mortgage fraud to generate income and launder money from the proceeds of their operations, such as drugs, human trafficking and prostitution.
“While there is no evidence to suggest mortgage fraud directly funds terrorist acts, this area of criminality has been encountered during investigations into UK-based terrorist groups,” it said. “Mortgage fraud can be used to finance infrastructure including safe houses.”
Given this tenuous link to terrorism (if that is indeed what McCain was referring to) and misimpression that either the bailout or Wall Street aided terrorists, we judge this statement to be Bullshit.
