US charges three with exporting drone parts to Lebanon’s Hezbollah

Hezbollah fighters march holding flags in this file photo. (AFP)
Updated 18 February 2018
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US charges three with exporting drone parts to Lebanon’s Hezbollah

BEIRUT/WASHINGTON: A federal grand jury in Minnesota indicted three people on charges that they conspired to export drone parts and technology from the US to the Iranian-backed Hezbollah militia in Lebanon, authorities announced Friday.
The US Attorney’s office for Minnesota said two of the suspects — brothers Usama and Issam Hamade — are now in custody in South Africa, while the third, Samir “Tony” Berro, remains at large. All three are Lebanese citizens. Usama “Prince Sam” Hamade also has South African citizenship, while Berro and Issam Hamade are also UK citizens.
The US considers Hezbollah a terrorist organization. The militant group has used drones at least since 2004. The indictment alleges the conspiracy operated from 2009 through to December 2013. It says the equipment included electronics that can be used in drone guidance systems, one jet engine and 20 piston engines that can be used in drones, and a pair of digital video recording binoculars.
The brothers were arrested Tuesday in South Africa for extradition to the US to face trial in Minnesota, according to another prosecution filing Friday. They appeared before a magistrate there and were ordered held pending another hearing on Feb. 26. Usama Hamade is a South African resident. The filings do not say where Issam Hamade lives, but said he would visit his brother in S. Africa.
The indictment does not name the companies, but the model names and numbers indicate the IMUs were manufactured by Concord, California-based Systron Donner Inertial, and that the digital compasses were made by Honeywell International’s operations in suburban Minneapolis.
The jet engine was sold by an unnamed Indiana company, while the piston engines were sold by an unnamed Florida company. The model number indicates the digital binoculars were made by Sony. None of the items could legally be exported to Hezbollah, the indictment said.
Berro controlled SAB Aerospace, based in Dubai, the indictment said. The defendants had most of items shipped to Lebanon and Hezbollah through the UAE and South Africa, it said. One shipment of piston engines also went through Minnesota.
Usama Hamade falsely claimed the IMUs and digital compasses would be used in drones in South Africa to monitor wildlife to prevent poaching, the indictment said. As part of the conspiracy, the indictment also alleged, Issam Hamade made nearly $174,000 in wire transfers from a bank in Beirut, Lebanon, to accounts controlled by his brother.
Imad Harb, founder and director of Quest for Middle East Analysis, a research and consulting firm, praised US efforts to crack down on Hezbollah’s widespread global military, technology and intelligence-gathering programs.
“In the United States, they are definitely having a serious impact but that does not mean they are totally ending Hezbollah’s activities. A lot of things go under the radar of even the American intelligence services,” Harb told Arab News.
“But, in the end, anything the US does to stop funds flowing to Hezbollah in Beirut is a good thing.”
Harb described a global Hezbollah footprint with cash raising, drug smuggling and other activities across Latin America, Africa and the Middle East that funded the group’s military efforts on behalf of Tehran.
“This is something that not only benefits Hezbollah, but also benefits Iran,” Harb said.
“Whether it is technology or information, anything Hezbollah gets is sent to Iran. Hezbollah is a representative of regional power that looks to expand its reach and already has a weaponized drone program, for which Hezbollah’s activities are essential.”
Washington has long targeted Hezbollah with sanctions, accusing the group of terrorist attacks and destabilizing parts of the Middle East using resources gained through global drug smuggling and money-laundering operations.
Last month the US Justice Department created the Hezbollah Financing and Narcoterrorism Team, a unit of specialists on money-laundering, drug trafficking, terrorism and organized crime aimed at Hezbollah’s fund-raising wing.
Lebanese economist Ghazi Wazni told Arab News that he wondered how suspicious wire transfers were processed without getting frozen.
Commenting on the $174,000 transferred from a bank account in Beirut to accounts in South Africa, he said: “Regardless of the amount transferred in dollars from any Lebanese bank to any other country, the sender must be questioned about the reasons for the transfer, which must undergo wire transfer audit by the bank’s compliance department.
“If the transfer is valid, the process proceeds,” he continued, “If not, it gets passed on to a special investigation commission as a first step. In the second step, the transferred amount should undergo a second audit procedure by the correspondent in New York on the reasons for the transfer. 
If the transfer is valid, the process proceeds, but if found suspicious, the correspondent should freeze the transfer and demand a revision by the bank in which it was made. If the bank confirms the reasons for the transfer are legal, the correspondent decides whether to freeze the amount, return it to the bank, or complete the transfer.”
Wazni pointed out that “the amounts entering or leaving Lebanon undergo several auditing procedures — especially the ones associated with South Africa and Angola.”
Former Lebanese Army Gen. Elias Farhat told Arab News that “drone technology is available in many markets and is legally sold around the world, but banned in Lebanon because it can be used in espionage operations and bomb attacks.”
He explained that the drones sold in Lebanon are of certain kinds that cannot reach high altitudes and are used for filming weddings and other occasions.
“Any imports related to drone technologies or to security issues are subject to customs control and require permits from the Ministry of Defense,” he said, adding: “Even antennas that get installed on buildings’ rooftops require permits from the Ministry of Defense to be allowed into Lebanon.”
Farhat said that “drones can be ordered online without the need for the state to import them.” He highlighted that “Iran has advanced domestically built drones and does not need foreign technologies.”


Philippines may become region’s ‘defense industry hub’

Updated 7 min 30 sec ago
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Philippines may become region’s ‘defense industry hub’

  • Israel wants to manufacture UAVs in the Philippines
  • Russia and South Korea looking for arms and defense manufacturing facilities

MANILA: The Philippines may become the region’s defense industry hub after several countries expressed an interest in basing their arms and defense manufacturing facilities in the country.

Among the facilities are firearms and force protection plants, as well as ones for aviation maintenance, repair and overhaul.

Department of National Defense (DND) spokesperson, Arsenio Andolong, cited at least three countries — Israel, Russia and South Korea — as among those with a keen interest to undertake such projects.

However no agreement has been signed yet and proposals are still in the exploratory stage, Andolong said.

There are plans, however, to create a zone processing defense material at the 370-hectare Government Arsenal (GA) in Limay, Bataan. It will be called the Government Arsenal Defense Industrial Economic Zone (GADIEZ), which will accommodate foreign defense firms that want to establish their manufacturing plants in the Philippines.

With Israel, negotiations have been ongoing. “It all began when we purchased our latest acquisitions from them, the force protection equipment during the time of (then Defense Secretary Voltaire) Gazmin,” Andolong said.

“They became more aggressive when we started doing market research for the many things that we wanted. In one of our meetings the plan to put up an export processing zone for war materiel was discussed and that’s when they expressed interest,” he said.

But Israel now changed its focus; they now want to enter into partnership with Philippine Aerospace Development Corporation.

An agreement has yet to be signed however between the Philippine government and an Israeli firm for its entry through aircraft repair.

“I think eventually it will lead to setting up a UAV manufacturing facility,” a highly placed source said.

Russia, meanwhile, is more likely to have a firearms factory in Bataan province, in central Lozun region.

That is despite the ceremonial signing of a Letter of Intent (LoI) of Silver Shadow Advanced Security Systems (SASS) and Rayo Illuminar Corporation (RIC) to “explore opportunities in the manufacturing and refurbishment of small arms and ammunition,” during Duterte’s recent visit to Israel. The project is estimated to be worth $50 million.

Russia, according to Andolong, has been sending representatives to the country to discuss their offer for a joint production facility to produce Russian assault rifles, or AK47s.

“The Russians verbally communicated that they would like to go into a partnership with the GA to manufacture AK47 rifles in the Philippines. But at this time it’s still a verbal proposal. The Department of Budget and Management (DBM) has required them to submit a feasibility study.”

A proposal by a South Korean firm that also wanted to set up a firearms factory in the Philippines was put on hold after they gave terms and conditions that were not acceptable — such as “there will be capitalization from the government.”

“So everything is still fluid but Russia is in the running because they are offering many nice goodies,” the DND spokesperson said. “Like the submarines, for example; they said if the Philippines can’t afford to purchase then they can give a soft loan to finance it. And they also mentioned about packages they can use to start up the business.”

Andolong said that the reason that these countries chose the Philippines to set up their facilities was mainly because “they want to create a hub here in the Southeast since they don’t have a presence here yet.”

“It may also be “because of our location. Aside from that we are I think the first Southeast Asian country who offered this,” he said.

“The Philippines is close to many potential markets of Russia and Israel, because these two countries, their main exports really are armaments and they have no footprint in this region,” he said.