Terror

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BANKS have frozen the assets of an Australian group accused of having terrorist links, invoking emergency United Nations anti-terror sanctions for the first time in this country.

The group, International Sikh Youth Federation or ISYF, is banned in Britain and recently joined a long list of others branded terrorists by the United States, including Al-Qaeda and the Taliban.

A spokeswoman for Justice and Customs Minister Customs Minister Chris Ellison confirmed bank accounts held by the ISYF in Australia had been frozen, consistent with an international agreement signed after September 11.

The group's Australian president Karnail Singh denied any link to terrorists fighting for an independent Sikh homeland in India's northern Punjab state, which borders Pakistan and the disputed Kashmir province.

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Mr Karnail Singh said the clampdown was the result of a "misunderstanding".

"We never have anything to do with terrorism," he said. "We want to give clarification, we are very upset."

At last count the ISYF had around 500 members in branches across the country, including Sydney, Melbourne, Brisbane and Adelaide.

It is understood the group held accounts at ANZ and Commonwealth Bank.

Neither contained more than $2000 but it is not known how much money flowed through them in the past. ISYF branches in Britain and elsewhere are accused of funneling money to Sikh terrorists in India.

Prime Minister John Howard singled the ISYF out in October 2001 as a terrorist organisation that may be operating Australia, along with Middle Eastern groups Hammas and Hezbollah and the Tamil Tigers.

But it was not until June 12 this year, when the ISYF's name appeared on an updated list of proscribed organisations gazetted by the Department of Foreign Affairs, that alarm bells began ringing at the banks.

Senator Ellison's spokeswoman said they contacted the Australian Federal Police after rechecking their records.

"As a result of investigations Australian authorities believe that the accounts are owned and controlled by or on behalf of the International Sikh Youth Federation, which is a gazetted entity," she said.

India claims the group's leader, Lakhbir Singh Rode, is being sheltered by Pakistan in Lahore and has demanded his extradition to face charges of arms smuggling and assassination. But Mr Singh said the Australian ISYF had no connection with Lakhbir Singh Rode or the outlawed branches in Britain and elsewhere, despite having the same name.

"It's the same name, that's the misunderstanding. They can check that out if they like," he said.

The Australian ISYF worked to combat drug abuse among young people and never sent money to terrorist groups in India, he said.

The ISYF was seeking a meeting with Foreign Minister Alexander Downer.

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