AML Professionals and Addressing the Challenges of Combatting Terrorist Financing

—an ACAMS Resource

Terrorist financing is the process by which terrorists fund their operations in order to perform terrorist acts. Terrorists need financial support to carry out their activities and to achieve their goals. There is little difference between terrorists and other criminals in their abuse of the financial system. While different from money laundering, terrorists often exploit similar weaknesses in the financial system.

Terrorist organizations come in many forms, ranging from small, underground networks to large, regional bodies. Most recently, the terrorist group Islamic State in Iraq and the Levant (ISIL, or sometimes referred to as ISIS) has garnered attention for its particularly ruthless attacks and its unique funding streams. Generating capital by way of bank robbery, pirating oil fields, and robbing other economic assets, ISIL has access to approximately a half billion dollars’ worth of financing. As with most terrorist organizations, the actual acts of terrorism are relatively low-cost compared to the damage they inflict; however, the operational costs of sustaining an organization are significant.

Terrorist cells exercise several methods to raise and “clean” their money, ranging from illegal activities like organized fraud or narcotics, to legitimate funding sources, including charitable organizations or legitimate businesses. With ISIL/ISIS, and sadly so many other terrorist groups, their revenue streams are diversified and far-reaching. Regardless of how they raise their capital, the end goal is to ultimately disguise the funds by exploiting global financial systems.

Detecting and reporting terrorist financing red flags is the most effective way to combat terrorist financing and stop the flow of funds.

ACAMS has created this resource page as a tool to help AML and counter terrorist financing professionals find topical news articles, research papers, government organizations, and recorded conference sessions to assist in identifying terrorist financing schemes, blocking their funding, and ultimately halting terrorists’ plans.