Riyadh-based Al-Haramain Islamic Foundation's assets will be folded into a new group that will channel all Saudi charitable contributions abroad, a news agency quoted Adel al-Jubeir, foreign affairs advisor to Crown Prince Abdullah bin Abdul Aziz, as telling a press conference in Washington.

The announcement came after an understanding between Saudi Arabia and the United States. US officials have long believed Al-Haramain has helped fund "terrorist" groups.

Saudi and US officials said they would seek to block the assets of the foundation's branches in Afghanistan, Albania, Bangladesh, Ethiopia and the Netherlands.

Washington added the Al-Haramain affiliates in Afghanistan, Albania, Bangladesh, Ethiopia and the Netherlands to its list of people or groups believed to have committed, threatened or supported "terrorism".

That requires US banks to check their records and freeze the assets of those listed. The US and Saudi officials said they would ask for the affiliates to be added to a similar UN list, triggering a global search.

According to a pact signed last month, the US can take action against any terrorist outfits in Bangladesh.

Jubeir said Al-Haramain at its peak raised $40 million to $50 million a year and he roughly estimated the new entity that will funnel all Saudi charity abroad could raise $100 million a year, spiking higher when there are natural disasters.

ALLEGED TERROR LINKS

Bangladesh police arrested seven Al-Haramain men in its Uttara office in September 2002 after intelligence agencies reported their links to terror funding and trafficking in women and children under the veil of imparting Islamic education.

Although allegations against the members of the organisation were specific, they were released after a few days as the police said they failed to find evidence against them. Sources said they were released under 'external pressure'.

Al-Haramain has been active in Bangladesh since it opened an office in Cox's Bazar in 1992 to help Rohingya refugees. It opened an office in Dhaka in 1995 and runs four orphanages in Uttara, Nilphamari and Gazipur and 60 mosques across the country. It spread its network to 38 districts and received a five-year grant of Tk 19.27 crore until 2001.

"The western world and its supporters who are Christians, Jews and part of the Muslims are against Islam and it is part of their long-term plan to freeze our funds," said Hasan Adam, country director of Al-Haramain Islamic Studies, Bangladesh.

Sudan-born 45-year-old Adam said Al-Haramain was targeted because of its popularity. "It is not that they won't get on others. They will target every organisation one after another and this is just the beginning. Look at them. First they captured Afghanistan, then Iraq…and next they might go for Sudan or Jordan."

He denies any links between international or local militant groups and his organisation and says: "We work in the health sector, fund mosques, give relief, set up tubewells and help orphans."

Adam, who was among the seven arrestees accused of backing terrorism, says: "The police did not find evidence against us."

With 169 staffers, including 14 foreigners, and annual allocation of Tk 3.5 crore, the Bangladesh branch of Al-Haramain looks after 400 orphans, 220 non-orphan students and 90 students of higher studies, he claimed.

RISE OF MILITANTS

Although the government denies the presence of Islamic militants in Bangladesh, the recent vigilante action of Jagrata Muslim Janata Bangladesh (JMJB), an outgrowth of Jama'atul Mujahedin Bangladesh (JMB), underlines their rise.

The JMB is the youth front of Harqat-ul-Jihad, an al-Qaeda funded front banned in the neighbouring countries and blacklisted by the US in the wake of the September 11 incident. The JMB in its camps trains its recruits in warfare and its leaders told The Daily Star that the party wants to establish an Islamic rule in Bangladesh based on Taliban ideology.

More than 100,000 JMB members operate across Bangladesh, the Islamist outfit leaders said.

A string of bomb attacks on cultural and political gatherings that left more than 140 dead between 1997 and 2004 also indicates strong presence of Islamic militants.

A bomb blast at Hazrat Shahjalal Shrine in Sylhet on May 21 is the latest attack that injured British High Commissioner to Bangladesh Anwar Choudhury and killed three other people.

Some Islamic leaders operating from madrasas are also campaigning for the Taliban concept and motivating young students to destroy the democratic system.

Despite a host of newspaper reports, the government apparently cloaked all terror episodes in mysterious silence.

US-SAUDI ANNOUNCEMENT

Reuters reports from Washington that US and Saudi officials believe transferring Al-Haramain's concerns to the Saudi National Commission for Relief and Charity Work Abroad would help keep charitable donations out of wrong hands.

"We do this in order to ensure that the charity of our citizens goes to those who need it and that we know where funds go when they leave Saudi Arabia," Al-Jubeir told the press conference.

Jubeir said the new entity would operate with transparency and provide quarterly reports on how funds are spent.

"This is very important," said Dennis Lormel, until recently the head of the Federal Bureau of Investigation's terror financing section. "It's significant because all along previously the Saudis were dragging their heels on Haramain."

"The symbolism that the Saudis have finally stood up and are joining in some type of action speaks volumes," he said.

The announcements followed the weekend killing by suspected al-Qaeda gunmen of 22 people in a hostage-taking and shooting spree in the eastern Saudi city of Khobar. It was the second attack in a month on the Saudi oil industry.

American officials added Al-Haramain's former head -- Aqil al-Aqil -- to the US list. Saudi Arabia has dismissed Aqil from Al-Haramain, frozen his assets and is investigating his activities.

Al-Haramain was first added to the US list on March 11, 2002, when its Bosnian and Somalian branches were designated. On January 22, Washington and Riyadh announced they added its branches in Indonesia, Kenya, Tanzania and Pakistan.