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Book part
Publication date: 13 May 2019

Bappaditya Biswas and Ashish Kumar Sana

Terrorism finance (TF) has been aptly termed as the lifeblood of terrorism. TF provides funds for terrorist activities. Terrorists mobilize funds by using the formal…

Abstract

Terrorism finance (TF) has been aptly termed as the lifeblood of terrorism. TF provides funds for terrorist activities. Terrorists mobilize funds by using the formal banking system, informal value-transfer systems, hawalas, Hundis, and the oldest method of asset transfer. They may raise funds from legitimate sources, such as personal donations and profits from businesses and charitable organizations, as well as from criminal sources, like the drug trade, the smuggling of weapons and other goods, fraud, kidnapping, and extortion. Countering the financing of terrorism is a far greater challenge throughout the world. The objectives of the chapter are as follows: (1) to identify the different sources of terrorism financing, (2) to analyze various ways of moving terrorism funds globally, and (3) to examine the initiatives taken to counter terrorism financing.

Details

The Impact of Global Terrorism on Economic and Political Development
Type: Book
ISBN: 978-1-78769-919-9

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Article
Publication date: 1 January 2012

Angela Samantha Maitland Irwin, Kim‐Kwang Raymond Choo and Lin Liu

The purpose of this paper is to measure the size of the money laundering and terrorism financing problem, identify threats and trends, the techniques employed and the…

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5192

Abstract

Purpose

The purpose of this paper is to measure the size of the money laundering and terrorism financing problem, identify threats and trends, the techniques employed and the amount of funds involved to determine whether the information obtained about money laundering and terrorism financing in real‐world environments can be transferred to virtual environments such as Second Life and World of Warcraft.

Design/methodology/approach

Analysis of 184 Typologies obtained from a number of anti‐money laundering and counter‐terrorism financing (AML/CTF) bodies to: determine whether trends and/or patterns can be identified in the different phases of money laundering or terrorism financing, namely, the placement, layering and integration phases; and to establish whether trends and/or behaviours are ubiquitous to a particular money laundering or terrorism financing Type.

Findings

Money launderers and terrorism financers appeared to have slightly different preferences for the placement, layering and integration techniques. The more techniques that are used, the more cash can be successfully laundered or concealed. Although terrorism financers use similar channels to money launderers, they do not utilise as many of the placement, layering and integration techniques. Rather, they prefer to use a few techniques which maintain high levels of anonymity and appear innocuous. The sums of monies involved in money laundering and terrorism financing vary significantly. For example, the average maximum sum involved in money laundering cases was AUD 68.5M, as compared to AUD 4.8 for terrorism financing cases.

Originality/value

This paper provides some insight into the relationship between predicate offence, the predominant techniques utilised in carrying out that offence and the sums of money involved.

Details

Journal of Money Laundering Control, vol. 15 no. 1
Type: Research Article
ISSN: 1368-5201

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Article
Publication date: 22 January 2020

Zeynab Malakoutikhah

The purpose of this study is to demonstrate that to what extent the Iranian criminalisation of terrorism financing meets the international standards of counter-terrorism

Abstract

Purpose

The purpose of this study is to demonstrate that to what extent the Iranian criminalisation of terrorism financing meets the international standards of counter-terrorism financing regime, particularly the Financing Convention and the Financial Action Task Force (FATF) Recommendations, and what is the main impediment for Iran to integrate at the international level to combat terrorism financing. Also, it tries to rate the Iranian criminalisation of terrorism financing in accordance with the FATF technical compliance rating.

Design/methodology/approach

This subject is analysed from an Iranian perspective by undertaking fieldwork through collecting documents in Iran and using the official documents, statements and laws, particularly the Iranian Law of Combating Financing of Terrorism (2018) from both Persian and English sources.

Findings

Iran’s terrorism financing offence is not completely in line with international counter-terrorism financing regime because of an exemption for the struggle of individuals, nations and national liberation movements with the aim of countering domination, foreign occupation, colonisation and racism. The Iranian support for national liberation movements is derived from the Constitutional Law that requires Iran supports the struggles of the oppressed for their rights against the oppressors anywhere in the world. As a result, the FATF Recommendation 5 (criminalisation of terrorism financing) would be rated partially compliant.

Originality/value

No article exists specifically on this research field. To the author’s knowledge, this paper, for the first time, examines the Iranian criminalisation of terrorism financing. It rates the criminalisation (Recommendation 5) based on the FATF technical compliance rating because no mutual evaluation has been conducted to date. The paper is useful for academicians, law enforcement, policymakers, legislators and researchers.

Details

Journal of Financial Crime, vol. 27 no. 1
Type: Research Article
ISSN: 1359-0790

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Article
Publication date: 6 July 2012

Angela Samantha Maitland Irwin, Kim‐Kwang Raymond Choo and Lin Liu

The purpose of this paper is to show how modelling can be used to provide an easy‐to‐follow, visual representation of the important characteristics and aspects of money…

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2506

Abstract

Purpose

The purpose of this paper is to show how modelling can be used to provide an easy‐to‐follow, visual representation of the important characteristics and aspects of money laundering behaviours extracted from real‐world money laundering and terrorism financing typologies.

Design/methodology/approach

In total, 184 typologies were obtained from a number of anti‐money laundering and counter‐terrorism financing (AML/CTF) bodies to determine the common patterns and themes present in the cases involved. Financial flows, transactions and interactions between entities were extracted from each of the typologies and modelled using the Unified Modelling Language (UML) features within Microsoft Visio.

Findings

The paper demonstrates how complex transactional flows and interactions between the different entities involved in a money laundering and terrorism financing case can be shown in an easy‐to‐follow graphical representation, allowing practitioners to more easily and quickly extract the relevant information from the typology, as opposed to reading a full text‐based description. In addition, these models make it easier to discover trends and patterns present within and across Types and allow money laundering and terrorism financing typologies to be updated and published to the wider international AML/CTF community, as and when new trends and behaviours become apparent.

Originality/value

A set of models have been produced that can be extended every time a new scenario, typology or Type arises. These models can be held in a central repository that can be added to and updated by AML/CTF practitioners and can be referred to by practitioners to help them identify whether the case that they are dealing with fits already predefined money laundering and terrorism financing behaviours, or whether a new behaviour has been discovered. These models may also be useful for the development of money laundering and terrorism financing detection tools and the training of new analysts or practitioners. The authors believe that their work goes some way to addressing the current lack of formal methods and techniques for identifying and developing uniform procedures for describing, classifying and sharing new money laundering and terrorism financing with the international AML/CTF community, as and when they happen, in a simple but effective manner.

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Article
Publication date: 3 October 2016

Zaiton Hamin, Rohana Othman, Normah Omar and Hayyum Suleikha Selamat

The purpose of this paper is to conceptualize the concept of terrorism, terrorism financing, the relationship between money laundering and terrorism financing and the…

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1524

Abstract

Purpose

The purpose of this paper is to conceptualize the concept of terrorism, terrorism financing, the relationship between money laundering and terrorism financing and the governance of terrorism financing.

Design/methodology/approach

This paper adopts a doctrinal, content analysis and secondary data, of which the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 and the Penal Code are the primary sources. The secondary sources for this paper include articles in academic journals, books and online databases.

Findings

Several methods are involved in the commission of terrorism financing such as raising, moving and using of funds. The activities relating to terrorism financing under the Penal Code are broader than such activities. Despite the adherence by Malaysia to international policies established by the Financial Action Task Force, terrorism financing has remained a threat that must be addressed by the relevant authorities.

Practical implications

This paper could be a useful source of information for the practitioners, academicians, policymakers and students studying this particular area of crime.

Originality/value

This paper contributes to a discourse on terrorism financing in the Malaysian context.

Details

Journal of Money Laundering Control, vol. 19 no. 4
Type: Research Article
ISSN: 1368-5201

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Abstract

Details

Compliance in Multinational Corporations
Type: Book
ISBN: 978-1-78756-870-9

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Article
Publication date: 2 May 2017

Nicholas Gilmour, Tristram Hicks and Simon Dilloway

The purpose of this paper is to examine – using crime script analysis – the practical effectiveness of internationally endorsed and universally recognised counter-terrorism

Abstract

Purpose

The purpose of this paper is to examine – using crime script analysis – the practical effectiveness of internationally endorsed and universally recognised counter-terrorism financing (CTF) standards in preventing the movement of money for the purposes of terrorism. The paper does not seek to examine the originating circumstances of terrorist finances or how laundered value is assigned.

Design/methodology/approach

Preliminary evaluation focuses on the discrepancies between the practices of money laundering and terrorist financing. Following an introduction to crime scripts, internationally endorsed anti money laundering (AML)/CTF practices are discussed to identify the process used to trace, prevent and limit money laundering and terrorist financing. Several terrorist financing case studies are then aligned to the process of crime script analysis to determine whether existing AML/CTF practices are effective in preventing terrorist financing.

Findings

The AML model “Placement, layering, integration” is only relevant to CTF in the comparatively rare cases when the origin of the money is crime. This creates a false sense of security through over reliance on AML/CTF for CTF purposes. A crime script approach can be applied to terrorist finance, but it is currently hindered by insufficient reporting of low level financing of terrorists, their addresses and associates. Law enforcement make insufficient use of financial intelligence – as a routine practice – in their crime and terrorist investigations; they have not adopted parallel investigation as a routine approach and consequently remain largely unconnected with the AML/CTF regime.

Practical implications

Utilising terrorist financing case studies, this paper identifies that existing AML/CTF international standards and practices are not adequate for controlling the movement of funds for financing terrorism because of the lack of focus on a specific script that aligns to known terrorist finance methodologies. While the paper identifies that existing AML/CTF international standards are thorough, the process underpinning the financing of terrorism is too dissimilar to the process of money laundering, namely, placement, layering, and integration, to support practices associated with terrorism prevention and detection.

Originality/value

This paper provides an examination of the practicalities behind the countering of terrorist financing from a compliance and investigative perspective. The paper is of interest to those involved in policy, compliance and investigations associated with terrorist financing.

Details

Journal of Financial Crime, vol. 24 no. 2
Type: Research Article
ISSN: 1359-0790

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Article
Publication date: 1 January 2012

Nicholas Ridley and Dean C. Alexander

The purpose of this paper is to investigate the strategic intelligence oversights with regards to the funding of terrorism.

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2697

Abstract

Purpose

The purpose of this paper is to investigate the strategic intelligence oversights with regards to the funding of terrorism.

Design/methodology/approach

The paper considers the modus operandi of terrorist financing, and how and how speedily or otherwise they were identified, and the international and national anti‐terrorist financing measure implemented post 9/11.

Findings

The paper concludes that there were (and still are) strategic oversights, delays and distractions by government law enforcement and financial regulatory agencies in combating terrorist financing.

Practical implications

The paper suggests there should be more proactive exchange of intelligence by law enforcement and financial regulatory agencies in combating financing of terrorism.

Originality/value

The added value is lessons learned in international efforts against financing of terrorism.

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Article
Publication date: 18 November 2020

Seyfettin Unal and Mehmet Altun

This study aims to examine how important the countering terrorism financing is in the fight against terrorism and to what extent does financial intelligence contribute…

Abstract

Purpose

This study aims to examine how important the countering terrorism financing is in the fight against terrorism and to what extent does financial intelligence contribute into this field.

Design/methodology/approach

To this end, to collect data, semi-structured interview method was conducted for 15 experts, including academicians, judges, security and intelligence officers who have specialised and been practising in the field of terrorism. Then, the data were analysed with the descriptive and systematic method.

Findings

The findings highlight that countering terrorism financing is indispensable in the scope of the combating terrorism; however, there are still much to be done in practice to achieve more success in this field. The results also suggest that the process requires more flexible and proactive approach with the help of an autonomous financial intelligence unit to be more efficient. Moreover, there must be better cooperation and coordination at both national and international levels. Furthermore, training more professionals from multidisciplinary backgrounds and raising awareness among the public and private sectors are found to be other key factors for effective combating of the system.

Originality/value

The research has been conducted on participants who mostly have been in fight against terrorism over 20 years who are aware of the early methods, as well as the recent ones both in theory and in practice. Their view is significant to understand the situation in combating financing of terrorism.

Details

Journal of Money Laundering Control, vol. 24 no. 3
Type: Research Article
ISSN: 1368-5201

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Article
Publication date: 6 July 2015

Hamed Tofangsaz

The purpose of this paper is to examine whether the counter-terrorism financing regime provides a solid platform for a better understanding of who should be considered…

Abstract

Purpose

The purpose of this paper is to examine whether the counter-terrorism financing regime provides a solid platform for a better understanding of who should be considered terrorists or what forms terrorism, terrorist acts and terrorist groups, the financing of which is the subject matter. In the absence of an internationally agreed definition of terrorism, the question which needs to be posed is whether there is a clear and common understanding of what constitutes terrorism, terrorist acts and terrorist groups, the financing of which needs to be stopped. That is, from a criminal law perspective, whether the Terrorist Financing Convention, as the backbone of the counter-terrorist financing regime, clarifies what types of conduct, by who, in what circumstances and when, against whom (targets or victims) and with what intention or motivation should be considered terrorism?

Design/methodology/approach

It will be explained how and why it has been difficult to reach an agreement on the definition of terrorism. The endeavour of the drafters of the Terrorist Financing Convention and others involved in countering terrorist financing to establish a general definition of terrorism will be examined.

Findings

The record of attempts to define the elements of terrorism proves that it is hardly possible to reach an agreement on a generic definition of terrorism because the concept of terrorism is elusive and subject to various understandings. Even the definition provided by the Terrorist Financing Convention, is not convincing.

Originality/value

With regard to the findings, this paper calls for further research on the legal consequences of the implementation of the terrorist financing-counter measures, while the scope of terrorism, terrorist acts and terrorist organizations have been left vague.

Details

Journal of Financial Crime, vol. 22 no. 3
Type: Research Article
ISSN: 1359-0790

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