Research Paper on "Disrupting Terror Group Finances to Exploit Weaknesses in Terrorist Organizations"

Research Paper 9 pages (2847 words) Sources: 9

[EXCERPT] . . . .

Disrupting Terror Group Finances to Exploit Weaknesses in Terrorist Organizations

Global war on terrorism has been executed in many different fronts. This followed the 2001 terrorist attack on the United States that marked the beginning of targeting the financial networks of terrorists (Center for Excellence Defense against Terrorism, 2008). Terrorists depend on financial networks in order to succeed in executing their activities. Although terror activities are not costly, the support of training camps, infrastructure, command, and control requires the availability of significant funding. The current funding of Al-Qaeda is estimated to be $36 million and approximately $50 million for infrastructure and equipment (Lormel, 2002). However, while terrorism is expensive, it is not a profitable economic enterprise. Unlike human trafficking, organized crime and narcotics trade, the operations of terrorism depends on an independent source of financing. Additionally, terrorist organizations have developed a system of distributing these funds around the globe in conducting their operations on an international scale (Gunaratna, 2007).

Disrupting Terror Group Finances to Exploit Weaknesses in Terrorist Organizations

Introduction

The frameworks below provides the foundation for examining actions taken by corporations, individuals and agencies that have played critical roles in disrupting terror groups finances in the global war on terrorism. This study provides analysis on the uses and consequences of the tactics used in disrupting terror group finances and their effectiveness in combating terrorism. Moreover, it provides insights on how these tactics are linked; their effectiveness depends on how financial, law enforcement, military, and intelligence personnel will use them against terrorist groups (Zagaris, 2008).

Discussion

For terrorist organizations to succeed, they need to raise, transfer, and use some money. Therefore, counter-terrorism strategies must incorporate the financial component in order to curb this vice. There are different dimensions that target the financial networks of terrorists. If the focus is put on these aspects, it can contribute to disruption of financial support of terror groups (Amos & Petraeus, 2009). Further, it can also contribute in the identification and destruction of terrorist organizations. Financial assets can be blocked or frozen by the government by labeling organizations or individuals as terrorists or as associates of terror groups. Such actions can easily degrade the efforts of terrorists in accessing funds thus increasing the expenses of raising, using, and transferring funds. This may lead to a decrease in resources used by terrorists in executing attacks hence limiting their geographic scope (United States Marine Corps & John, 2007).

Blocking and Freezing Financial Assets

The government uses aspects such as blocking and freezing of financial assets as a way of attacking the finances of terrorists. Governments have the authority to freeze the financial assets of terrorist organizations, terrorists, and their associates' assets. Additionally, the government can impose trade sanctions that aim at controlling activities of these groups (Lormel, 2002). The treasury executes and administers such sanctions with additional support from the Financial Crime Department when suspicious activities are identified. This leads to the publication of a list of businesses such as banks and brokers that have been banned from conducting financial transactions with terrorist entities. The purpose of these sanctions is to deny terrorists and individuals who assist them from accessing financial systems. This also aims at increasing the cost of raising, moving, and using funds. If assets are frozen, it cuts off the supply of funds within terrorist members and blocks transactions thus preventing terrorists from transferring funds around (Center for Excellence Defense against Terrorism, 2008).

If the above two effects are combined simultaneously, they accomplish key strategic objectives. First, they lead to a decrease in the resources of terrorists and disrupt their ability to gather funds, which decreases their capability to operate on terms of their degree of synchronization, sophistication and degree of their lethal attacks. Secondly, if terrorists are denied the ability to transfer funds puts them in international isolation and cuts down on their geographical scope of operation. Such outcomes support the primary objective of the counter terrorism policy of containing terrorism within the enforcement of national law (Muller & Uriel, 2007).

The government has mandated the secretary of state with the responsibility of imposing the above sanctions terrorist organizations and their associates. The secretary of the treasury blocked not just terrorist organizations and terrorist, but individuals who are associated with terrorism activities. In addition, the scope of the sanctions has been broadened from national to global terrorism. Because the foreign policy has laid the foundation of these blocking actions, they are not treated as criminal proceedings. Further, there are numerous sources providing evidence for blocking and freezing assets: these sources are subject to privacy and they remain confidential to the reviewing court (Gunaratna, 2007).

The above sanctions have been successful in disrupting terror group fundraising and charities. The government has succeeded in dismantling international financial networks of terrorists. This has destructed millions of dollars that were channeled to these organizations. Groups supporting terrorist activities claim that they are suffering from the above financial sanctions due to the poisonous nature of the sanctions. As a result, these agencies have filed lawsuits and defamation suits against the government (Linden, 2007).

The Intelligence Aspects of the Finances of Terrorists

Disrupting terror group finances can be viewed from the perspective of following the terrorists' money. Since financial transactions involve proper documentation, identification of the financial structure of terrorist organizations and trailing their transfer of funds can be a source of hard evidence of relationships, associations, and networks. Law enforcement, intelligence and other authorities can use this evidence to locate, identify and apprehends terrorists. The business records provide financial linkages that offer verifiable and tremendous information that complements the relationships developed from signal, human and source intelligence. The front charities and organizations that launder and raise funds for terrorist organizations appear to be susceptible to investigations because of the nature of their finances (Center for Excellence Defense against Terrorism, 2008).

Departments such as the treasury and justice have recorded success in investigating and dismantling terror organizations. Investigations have led to the identification of the terrorists that hijacked four different accounts and their link to international financial support (Whitmore, 2002). In addition, the treasury department has recorded more than 2,400 arrests in foreign countries: the war against terrorist attacks in countries including Germany and Morocco have intensified courtesy of intelligence information obtained from financial trails of terrorists. The detention of Israel's lead terrorist Mustafa Ahmed has made the intelligence services optimistic about financial intelligence in curbing terrorist activities. The government was able to trail the financial records of Mustafa Ahmed and identified him. This was achieved by tracing funds that he transferred from cities such as Dubai and New York. Research indicates that documents found in Afghan were intimately associated with al-Qaeda's plots for carrying out assassinations and the distribution of biological and chemical warfare manual (USA international business publication, 2002).

Moreover, the U.S. Patriot Act provides more measures that facilitate the timely and thorough sharing of intelligence information between multiple agencies. This facilitates the effectiveness of data mining and investigations too. This Act authorizes financial entities, law enforcement institutions, and regulatory agencies to share intelligence about potential terror suspects or individual involved in money laundering activities. In addition, the Act decreases the complications associated with authority that requires subpoenas provided in countering terrorism and countering intelligence investigations. Such changes have paved way for an efficient and timely gathering of information from credit bureaus, financial institutions, internet service providers and telephone companies (USA international business publication, 2002).

Coordinated procedures and systems have been developed in order to analyze and distribute data between domestic and foreign entities. This mechanism is effective in deriving the value f intelligence from financial records. The establishment of the Terrorism Financial Review Agency has aided in carrying out investigations into terrorist financial matters (Lormel, 2002). Further, the FBI restructured and expanded its Terrorist Financial Operations department whose primary purpose was to identify, investigate, prosecute, and dismantle all financial and fundraising activities related to terrorists. FBI's financial database of terrorists is fundamental to its investigations. The database incorporates financial information derived from account records and records of foreign wire transfers and foreign banks. It also entails intelligence information gathered by other intelligence services. Authorities have been enabled to use this data in following familiar leads in search of patterns, signals, and profiles of financial activities. Such information is likely to help authorities in identifying leads on potential and active terrorists operations (Muller & Uriel, 2007)

The FBI has received substantial support from other agencies who are involved in conducting investigations in the finances of terrorism organizations. Such agencies include Financial Action Task Force, OFAC, and FinCEN. All these agencies have recognized the benefits and importance of conducting financial investigations for obtaining fact-based evidence, leads, and linkages to terrorists. The agencies work by collaborating thus coming up with separate financial records leading to critical formation of a map of terrorist organizations (USA international business publication, 2002).

Legislative measures and interagency cooperation that encourage sharing of intelligence information are fundamental in facilitating the effectiveness of intelligence data.… READ MORE

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