GORDON BROWN’S great idea is to attack terrorists and their money laundering in the same way Britain attacked the Nazis and their secret Enigma code: with a Bletchley Park-like taskforce. Rally the forensic accountants and kill the enemy with calculators.

He’s been linking terrorist funding and money laundering ever since 9/11, and he said it again yesterday in a speech to the Royal United Services Institute. He is resolutely determined to use money-laundering laws to stop terrorism and claims that, since 9/11, Britain has frozen £80 million in terrorist assets, which includes funds from more than 100 organisations linked to al-Qaeda.

But money-laundering laws didn’t stop the bombings in Madrid or in London and they won’t stop whatever comes next because terrorists don’t need to launder money. And, when you look closely at those frozen assets, you discover that most of them have been unfrozen, and that terrorist money-laundering prosecutions, on both sides of the Atlantic, have mostly failed.

Money laundering is the sleight of hand that finances organised crime, as perfected by the drug cartels. They move cash from street corners through global financial networks — using bankers, lawyers, accountants, company formation agents and brokers — spin it around the world, in and out of shell companies and secret banking jurisdictions, and bring it out the other end as apparently legitimate income. Some of that money justifies their extravagant lifestyles, some of it pays their taxes, some of it refinances their criminal activities.

But terrorists don’t need to do that because terrorism comes cheap. The Madrid bombings supposedly cost less than $1,000, and the attacks in London last July probably didn’t cost £100. The clearest example of what terrorist operations actually costs came in 1997, when the IRA issued a bomb threat to stop the Grand National at Aintree. The damage was measured in millions. The price was a 2p phone call.

What does cost money is paying for terrorists to live while planning an attack, and for that terrorist groups are happy to keep to cash. There’s nothing to launder.

The model that has shaped Mr Brown’s thinking is 9/11, when Osama bin Laden and al-Qaeda functioned like a multinational conglomerate, centrally funding a specific activity. They moved a relatively small amount of money — $300,000 to $500,000 — through the Western banking system with wires, credit cards and ATM machines. Smashing planes into the twin towers and the Pentagon cost nothing. Bin Laden’s money was spent on cell phones, rental cars, motel rooms, prostitutes, food and airline tickets. But that horse is long gone, and the stable door has, effectively, since been closed. Anyway, 9/11 was a one-off.

If you look pre-9/11 and post-9/11, you see al-Qaeda franchisees funding themselves with locally grown cash. You see that Mr Brown is relying on the wrong model.

The first attack on the World Trade Centre in 1993 cost about $25,000, which was stolen through low-level fraud. Same story with the “millennium plot” to blow up Los Angeles international airport in December 1999. Ahmed Ressam and his Montreal-based terror cell paid their bills with cheque fraud, credit-card fraud and identity theft.

These days Algeria’s Groupe Islamique Armée (GIA) bilks British banks and shops through credit card and check fraud, dealing in small amounts, but doing it sufficiently often that sums add up quickly. Just as quickly, they bulk their cash out of the country to pay the living expenses of terror cells on the Continent. GIA financed the 1995 attacks on the Paris Métro and there’s reason to believe they partially funded the Madrid bombings. To go after al-Qaeda ’s millions makes for good soundbites, but it won’t stop a GIA cell on the UK mainland.

Nor will it have any effect on “al-Qaeda, The Conglomerate,” because al-Qaeda no longer exists. At least it doesn’t in that form. Instead, it has morphed into something much more insidious. Today al-Qaeda is not a terror organisation, it is a brand. Any zealot anywhere in the world intent on reigning havoc, is a de facto franchisee with an instantly recognisable battle cry. And that costs nothing.

If Mr Brown wants to go after terrorists and their money, he needs to recall what was found three years ago when the police raided Abu Hamza’s mosque in Finsbury Park. More significant than weapons and chemical warfare suits were 100 stolen or forged passports and other identity documents, plus credit cards, laminating equipment, chequebooks and £3,000 in cash. That’s what al-Qaeda franchisees are interested in — the tools of low-level, under-the-radar crime.

It’s hardly a new concept. The IRA has funded itself this way for more than 30 years. It uses extortion, identity theft, social security fraud, building-site theft and cigarette smuggling. That’s the model Mr Brown needs to be studying.

Sure, when the Chancellor says he wants tougher inspections of bureaux de change, a closer look at wire transfers and suspect bank transactions, he’s right. But they’re mostly about drug money. He also wants to seize assets of suspected terrorists or collaborators. Good idea. Again, more drug money.

To get to the terrorists, you’ve got to get down below the radar, where the IRA first settled and where al-Qaeda’s franchisees are crawling around now. Then, why reinvent the wheel? Why build a new “Bletchley Park” when there’s already a group in place that specialises in this sort of thing. The National Terrorist Financial Investigation Unit (NTFIU), part of Special Branch at Scotland Yard, understands the link between terrorism and low- level crime, and happens to be very good at interrupting it. A huge increase in their funding would be a great start. Unfortunately, “Bletchley Park” makes for a better headline.

Jeffrey Robinson is author of The Sink: How Banks, Lawyers and Accountants Finance Terrorism and Crime, And Why Governments Can’t Stop Them

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