Charlotte, N.C. — At first glance, it appeared to be a case with the down-home feel of a moonshine bust: two brothers are accused of helping run a racket that smuggled cheap cigarettes for resale across state lines.
But the government now alleges the case has international intrigue, and that profits from the scheme were funneled to Hezbollah guerrillas.
According to the government, the case built on evidence gathered by local authorities, the FBI and Canadian security forces will show how the Lebanese nationals creatively exploited the American tax system to sponsor overseas terrorism.
"I think it (cigarette smuggling) is a clear-cut channel for funding Middle East groups out of the U.S.," said terrorism analyst Tom Sanderson of Washington's Center for Strategic and International Studies. "It's part of a much larger and more complex system."
Mohamad Youssef Hammoud, 28, is charged under a 1996 anti-terrorism law with providing material support to Hezbollah, labeled a terrorist group by the U.S. State Department.
He also is charged with money laundering, cigarette smuggling, immigration fraud, racketeering and other charges and could spend the rest of his life in prison if convicted and sentenced at maximum levels.
His brother, Chawki Youssef Hammoud, 37, faces lesser charges of immigration fraud, cigarette smuggling, money laundering and racketeering.
Jury selection in the trial is to begin Monday in U.S. District Court. The case is expected to last at least several weeks.
"It's going to be extremely hard to get an impartial jury," particularly after the Sept. 11 terror attacks, said Deke Falls, Mohamad Hammoud's lawyer. "Our judicial system is the best in the world, but this is going to be a real test of that system."
Authorities have never charged the Hammouds or any other defendants committed or planned acts of terrorism or violence. They say the smuggling operation, in which cigarettes from North Carolina allegedly were resold in Michigan without Michigan's higher cigarette taxes being paid, was aimed at generating cash for Hezbollah.
The case began in July 2000, when federal authorities in Charlotte charged 18 people, most from Lebanon, in an investigation into cigarette smuggling, money laundering and immigration violations.
The case took a higher profile nine months later, when eight Lebanese nationals and one woman from the earlier group were accused of involvement in a Charlotte cell of Hezbollah.
Seven have since pleaded guilty, leaving only the brothers to stand trial.
Said Mohamad Harb, 31, who pleaded guilty in February, initially had been the only defendant accused of providing material support to Hezbollah. He now is expected to be the government's star witness against Mohamad Hammoud, the alleged ringleader of the Charlotte cell.
Harb is expected to testify that in September 1999, he transported $3,500 from Mohamad Hammoud to Sheik Abbas Harake, a Hezbollah military commander in Lebanon.
As part of Harb's plea agreement, prosecutors recommended he serve a maximum 10-year prison sentence and pay a $250,000 fine. In addition, government officials brought some of Harb's relatives from Lebanon to the United States.