August 27, 2008
Terrorism Financing Is Still Big Business Even If Terrorist Attacks Sometimes Are Carried Out on the Cheap
By Victor Comras
There is a common misperception that terrorism can be carried out on the cheap and that small terrorist cells simply raise their funds locally making it extremely difficult to detect. This seems to be the thesis of a number of recent articles, including one a few days ago in the Washington Post. They maintain that terrorist groups simply avoid bank transactions, making current financial controls inutile. Nothing could be further from the truth! Terrorism financing is still big business, and the sophisticated money laundering and counter-terrorism financing oversight and regulatory mechanisms we have in place remain essential tools in combating terrorism. In fact, they are among our most useful tools in identifying the sources of terrorist funding and holding them accountable, and for tracking down the terrorist cells themselves. We need to intensify these measures and have them replicated in Europe and internationally in order to place similar restraints on terrorist funding sources overseas.
Terrorist attacks certainly have not abated since 9/11; neither has the flow of funds that support well organized terrorist organizations. While the cost of funding certain terrorist attacks might appear quite small, the fact is that indoctrinating, recruiting, motivating, training and equipping the terrorists that carry out such attacks is very expensive. Keeping Bin Laden, Zawahiri and their al Qaeda cohorts armed, fed, well protected, and hidden somewhere in Pakistan’s Northwest Frontier region is not an inexpensive operation; nor has the resurgence of the Taliban and its reorganization and re-armament come without great expense. Al Qaeda’s continuing operations in Iraq and its further extension into Somalia, Sudan and other areas of Africa also requires substantial funding. To this must be added the money it takes to support the military and terrorist wings of Hamas, Hezbollah, Islamic Jihad, and so many other terrorist groups operating in areas of Palestine, Lebanon, Egypt, and other areas of the Middle East. In fact, with terrorist cells operating as well in South and Southeast Asia, the former Soviet Union, Europe, and in North and South America, terrorism financing now involves a global reach. These worldwide operations are not financed alone through small local business operations, petty crime, or Internet schemes. Rather, they rely on deep pocket donors and on complex funding schemes, including the illicit drug trade, and substantial fund raising, transfer and distribution mechanisms.
At the same time, there are a number of small local groups, often made up of disaffected youth and others ready to carry out their own version of terrorism. These small local terrorist cells, it is true, operate on limited funding, which is usually self generated. Al Qaeda and other terrorist groups have effectively tapped into this phenomenon and increasingly use such groups, particularly in Europe, as their surrogates. They do so by using the Internet as an indoctrinating and recruiting tool, and by infiltrating local community centers and mosques so as to identify and recruit potential future terrorists and suicide bombers. Some of those so identified have had their passage paid to one of several Al Qaeda training camps in Pakistan, Afghanistan, the Middle East and elsewhere. Al Qaeda views these groups as highly expendable and apart from priming them for terrorism, expends little additional effort to fund or direct them. Fortunately, most such groups have been vulnerable to detection through established police intelligence gathering methods, and relative few have so far escaped detection. Nevertheless, such groups remain dangerous threats to domestic security.
While we have been doing a plausible job here at home, in regulating, overseeing and tracing suspicious terrorism-related transactions, and Europe is catching up, much of the world remains a sieve for major terrorism financing. There is still no international consensus on which groups, apart from Al Qaeda and the Taliban, are to be considered terrorist organizations and have their funding ties cut. And even with Al Qaeda and the Taliban, few countries still have the necessary means and political commitment to adequately regulate terrorism fundraising, transfer and distribution activities. This is particularly the case in Saudi Arabia, Iran, and several other Gulf States which openly support Hamas, Hezbollah, and other groups, and devote few, if any, resources to regulate and oversee the financial operations of their established banks and charities. This places a significantly increased burden on the US and European intelligence community to effective monitor the critical nodes of international transactions, and to otherwise seek to compensate for this serious international lacunae in controlling terrorism financing.