American companies should be wary of doing business with Qatar
© Getty Images

After years of supporting terrorist and extremist groups, Qatar finally faced consequences last month as seven countries — Bahrain, Egypt, Libya, the Maldives, Saudi Arabia, the United Arab Emirates and Yemen — all announced that they were severing diplomatic ties with the country. 

In breaking ties, Saudi Arabia announced that it was working to “protect national security from the dangers of terrorism and extremism.” Bahrain and others similarly cited national security concerns and Qatar’s destabilizing activities in the region. 

The heightened awareness of Qatar’s support for dangerous policies should alarm American companies considering doing business with entities linked to the Qatari government. One of the most prominent examples is American Airlines, which “received an unsolicited notice from Qatar Airways about the Middle Eastern airline's intention to acquire at least a 10-percent stake in American.”

ADVERTISEMENT
There are a plethora of serious risks associated with doing business with Qatari entities that should impel American Airlines and other businesses to reject any Qatari overtures until the nation comports itself with international law and ceases its harboring and support of extremists. The Counter Extremism Project has outlined Qatar’s troubling behavior in a series of studies that have exposed the country’s well-documented record of supporting and harboring international terrorist organizations and individuals. 

 

The Qatari government has long provided critical support to a wide array of terrorist and extremist groups, such as Hamas, al Qaeda in the Arabian Peninsula (“AQAP”), the Muslim Brotherhood and the Taliban. It has done so through direct money loans, ransom payments and supplies transfers.

In 2014, former U.S. Treasury Department Undersecretary for Terrorism and Financial Intelligence David Cohen described Qatar as a “permissive terrorist-financing environment” that enables “private fundraising networks” to operate within its borders. Per Cohen, Qatar “has for many years openly financed Hamas, a group that continues to undermine regional stability. Press reports indicate that the Qatari government is also supporting extremist groups operating in Syria.”

Notwithstanding Qatar’s direct financial support to designated terrorist groups, even ostensibly lawful financial interactions with Qatari entities carry the taint of impropriety due to widespread money laundering issues. 

In 2014, the U.S. State Department’s annual report on drug trafficking and money laundering censured Qatar for failing to ensure the integrity of its financial system. According to the report, “The expansion of the financial and trade sectors ... make[s] Qatar increasingly vulnerable to the threat of money laundering.  Exploitation of charitable services by terrorism financiers continues to be a concern, as does the misuse of exchange houses and other non-bank financial systems.” 

As recently as June 2017, Al-Arabiya reported that “Qatar is embroiled in money laundering in (Iraq) through a telecommunication company with the help of Iraqi politicians and a number of Kurdish MPs.”  The Qatari government reportedly owns 65 percent of the telecommunications company.

Qatar not only provides crucial financial aid to terrorist groups that is enabled and enhanced by a superseding legal framework that indulges money laundering for a variety of purposes. It is also the world’s foremost physical sanctuary for leading terrorist operatives and financiers from various extremist groups, including Hamas, al Qaeda and the Taliban. 

Currently, Qatar is harboring at least 12 sanction-designated or wanted individuals, including former Hamas leader Khaled Meshaal, Muslim Brotherhood ideologue Yusuf al-Qaradawi, three U.N.-sanctioned Taliban operatives and at least seven al Qaeda financiers. Although such individuals are sanctioned by the United States or United Nations, or are the subject of INTERPOL arrest warrants, they are able to live freely — and in some cases, in luxury — within Qatar.

As reports of Qatar’s nefarious behavior continue to transpire under the penetrating glare of public and media scrutiny, influential shareholders and the investing public are unlikely to look charitably upon any company whose desire for ties with Qatar will inexorably finance that government’s policies of sponsoring and incubating terrorism. 

Inevitably, when civic-minded shareholders, pension funds, university foundations and public interest groups learn that a company continues to do business with a terrorist-nurturing regime, it is difficult to see how shareholder value will not suffer. 

Serious legal, financial, commercial and reputational risks associated with operating in and doing business with Qatar will continue for the foreseeable future unless and until Qatar fundamentally changes its behavior and verifiably abandons its manifest support of terrorist and extremist groups and individuals.

Qatar’s brazen attempts to co-opt and/or suborn U.S. interests through massive investments in flagship enterprises like American Airlines should neither mask nor exonerate its misconduct at home. Prudent companies should conclude that business opportunities, partnerships and ties in and with Qatar and its affiliated agencies are not worth the risk.

Mark Wallace is the chief executive officer of the Counter Extremism Project (CEP), an international organization that aims to combat extremism by pressuring financial and material support networks; countering the narrative of extremists and their online recruitment; and advocating for smart laws, policies and regulations. Wallace previously serving as United States ambassador to the United Nations, representative for U.N. management and reform under President George W. Bush.


The views expressed by contributors are their own and not the views of The Hill.