Terrorism financing case ends in mistrial

Times Staff Writer

The U.S. Justice Department suffered a major setback in another high-profile terrorist prosecution Monday when its criminal case against five former officials of a now-defunct Islamic charity collapsed into a tangle of legal confusion.

U.S. District Judge A. Joe Fish declared a mistrial, but not before it became clear that the government's landmark terrorism finance case -- and one of its most-costly post-9/11 prosecutions -- was in serious trouble.

His decision came after jury verdicts were read to a packed courtroom indicating that none of the defendants had been found guilty on any of the 200 combined counts against them. Jurors had acquitted defendants on some counts and were deadlocked on charges ranging from tax violations to providing material support for terrorists.

However, during routine polling of the jurors to determine that their votes were accurately reflected in the findings, two said they were not. When efforts to reconcile the surprise conflict failed, Fish declared the mistrial.

The case presented to a Texas jury of eight women and four men relied heavily on Israeli intelligence and involved disputed documents and electronic surveillance gathered by federal agents over a span of nearly 15 years. Fish's order ended a two-month trial and 19 days of jury deliberations over allegations that Holy Land Foundation for Relief and Development and five of its former leaders provided financial aid to the Palestinian terrorist group Hamas.

President Bush announced in December 2001 that the Texas-based charity's assets were being seized, and in a Rose Garden news conference accused the organization of financing terrorism. Monday's outcome, however, raised serious questions about those allegations as well.

"I think it is a huge defeat for the government," said David Cole, a Georgetown University law professor specializing in 1st Amendment cases and terrorism prosecutions.

"They spent almost 15 years investigating this group, seized all their records and had extensive wiretapping and yet could not obtain a single conviction on charges of supporting a terrorist organization."

According to one juror interviewed Monday afternoon, the panel was evenly split on most of the disputed charges and not close to convicting anyone.

Juror William Neal, 33, who said his father worked in military intelligence, said that the government's case had "so many gaps" that he regarded the prosecution as "a waste of time."

It was unclear Monday whether the government would seek to retry all five defendants, but supporters viewed the outcome as vindication.

"My father was singled out for feeding, clothing and educating the children of Palestine," said Noor Elashi, the 21-year-old daughter of defendant Ghassan Elashi, Holy Land's former chairman. "I am the daughter of an American hero," she said.

Outside the courthouse in a pouring rain, jubilant supporters hoisted defendants on their shoulders. "I will let this speak for what happened," said defendant Shukri Abu Baker, the former president of Holy Land, waving from the shoulders of his backers. He declined to speak further because of a continuing court-imposed gag order.

The gag order also prevented prosecutors and defense attorneys from responding publicly to what is the most bizarre outcome of any of the government's post-Sept. 11 terrorist prosecutions.

It is not the only prosecution failure. In Florida two years ago, a former college professor was acquitted on eight counts of aiding Palestinian terrorists. A jury deadlocked on a ninth count and the defendant pleaded guilty to a lesser charge to avoid retrial. Earlier this year a federal jury in Illinois acquitted two men of operating a terrorist recruiting and financing cell.

When the Dallas verdicts were first read on Monday, it appeared the jury had deadlocked on all the charges brought against the now-defunct foundation and its two best-known officials, Baker and onetime board chairman Elashi. The two American citizens each faced 32 counts of supporting terrorism and four counts of tax-related crimes.

The verdicts, as originally outlined, also suggested the jury had found former Holy Land volunteer fundraiser Mufid Abdulqader not guilty on all 32 terrorism financing counts he was facing and either acquitted or deadlocked on the same 32 counts for another former foundation chairman, Mohammed El-Mezain, and Abdulraham Odeh, the foundation's onetime New Jersey representative.

As those verdicts were read, many of the defendants and their families broke into smiles. But minutes later, their relief turned to uncertainty during the jury poll.

The jury forewoman, who like the other jurors was not identified, told the court she could not explain the positions of the two panelists. "When the vote was [taken]. . . no one spoke up" about any differences, she said. "I really don't understand where it's coming from. . . all 12 made that decision."

The judge excused the jurors to work out the discrepancies. About 40 minutes later, they returned to court and the two female jurors both continued to maintain that their verdicts had not been tallied accurately.

As a result, Abdulqader's acquittal on all counts was set aside, forcing him to face a potential retrial with the others.

Both women had been noted dozing off during court proceedings, and juror Neal said one of them also fell asleep during deliberations. The latter, he said, voted guilty from the beginning, was confused by the evidence and much of the time declined to participate in deliberations.

Khalil Meek, president of the Muslim Legal Fund of America, echoed sentiments suggesting the government had overreached in pursuing the case. He called it "a huge loss."

"When the government brings all this ammunition to trial and cannot come away with one guilty verdict, what else can you call it?"

The Holy Land Foundation was created in Los Angeles in 1988 and later moved to Richardson, Texas, outside Dallas. By 2001 it had become the largest Muslim charity in the U.S. and is believed to have distributed about $56 million here and abroad.

The FBI first began investigating the foundation nearly 15 years ago. Court records show that it was periodically subjected to government surveillance. After the Bush administration ordered the charity closed, Holy Land officials fought unsuccessfully in federal civil courts to reinstate it.

In 2004, the government alleged that Holy Land and its officials funneled about $12 million to Hamas through local charities called zakat committees. The government argued that from its inception Holy Land was intended to be a fundraising tool for Hamas, a contention that was never documented in court.

Georgetown's Cole said Monday's outcome reflected flaws and overreaching in the government's long-running case against Holy Land.

"One is that the government's theory here was a real stretch under the law, because they were seeking to hold these individuals responsible not for funding Hamas, which is a designated [terrorist] group, but for funding non-designated groups that the government claimed were fronts for Hamas."

Additionally, he said, the case should raise questions about the administrative process that enabled the government to shut down Holy Land almost six years ago, long before criminal charges were brought.

"That was a summary process that involved no trial, permitted the government to rely on secret evidence and barred the defendants from ever introducing their own evidence in court. Now we see when they are required to put their evidence on the table, the government is not able to prove a single charge," Cole said.

In contrast to many other post-Sept. 11 terrorism cases, the Justice Department never accused Holy Land or its five defendants of plotting terrorist attacks or directly purchasing weapons or other materials that could be used by extremists.

As one Justice Department official said months before the trial began, "We have not alleged that Holy Land pulled the trigger or lit the fuse of a bomb. But they have facilitated those who pulled the trigger or lit the fuse."

To buttress that claim, which was the linchpin of the government's case, the U.S. called on a former FBI official who has written extensively about Hamas and an Israeli security officer who was allowed the extraordinary accommodation of testifying anonymously and in a closed courtroom.

The security officer, identified only as "Avi," was particularly crucial to the government's case because he testified that each of the zakat committees identified in the indictment was controlled by Hamas.

Key defense testimony came from career diplomat Edward Abington, the former U.S. consul general in Jerusalem and the second-highest-ranking intelligence officer in the State Department before his retirement. He told jurors he was briefed daily by the CIA and was never told that any of the zakat committees were under Hamas' control.

Abington also recalled how he had personally visited each of the zakat charity committees named in the indictment and did not believe they were linked to terrorism.

Juror Neal said it seemed that the government "really used fear" to try to sway the panel, but in the end the case came down to weak evidence.

"There wasn't any clear evidence linking the [Holy Land fund] transfers to Hamas," he said.

greg.krikorian@latimes.com

Times special correspondent Sarah Junek contributed to this report.

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