EU attention on terrorist financing has faded – the threat has not – POLITICO

EU attention on terrorist financing has faded - the threat has not - POLITICO
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Tom Keatinge is the founding director of the Center for Financial Crime and Security Studies at the Royal United Services Institute.

Seven years ago this month, tragedy struck Paris when terrorists murdered 100 innocent citizens and left hundreds more with life-altering injuries.

The Paris calamity heralded a wave of large and small-scale terrorist attacks – all with devastating consequences – in a series of European cities, as supporters of the so-called Islamic State (ISIS) “self- were activating” in response to the appeal of jihadist leaders, asking them to mount attacks in the streets of the West.

And in each case, finance played a key role in subsequent investigations, bringing to light possible missed opportunities to avert catastrophe. Yet this is something we already seem to have forgotten.

The European Union first reacted to these events by publishing in 2016 an “Action Plan to strengthen the fight against the financing of terrorism” which revolved around two main themes: first, how to detect and prevent organizations terrorists and their backers to transfer funds, and ensure that all financial movements are used to help law enforcement track down terrorists and prevent crimes; and second, how to disrupt the revenue streams of terrorist organizations by targeting their ability to raise funds in the first place.

That it took the murder of innocent citizens in EU cities for the bloc to finally present such a plan was shameful – and it was also indicative of the wider apathy towards counter-terrorism in Brussels. .

However, more than a decade after finance proved so central to the al-Qaeda 9/11 attacks on New York and Washington DC, the EU has finally come to grips with the reality of finance as a as a pillar of Europe’s response to terrorism. And to complement this political orientation, across Europe, no speech by a political leader at the time was complete without vague calls to “cut off” terrorism funding.

With this in mind, in 2018, French President Emmanuel Macron convened his No Money for Terror conference, the latest iteration of which will be hosted by India this week; in 2019, the country took advantage of its presidency of the United Nations Security Council to present an updated resolution on the financing of terrorism (UNSCR 2462); and the Financial Action Task Force (FATF), the global standard setter for anti-money laundering and anti-terrorist financing, conducted a revealing review of what countries were actually doing – or rather were not doing – to combat the financing of terrorism.

Fortunately, over the past two to three years, the frequency of such attacks has decreased significantly, whether due to the decline of the Islamic State in Syria and Iraq, more effective responses by security authorities or restrictions due to the COVID-19 pandemic. But the threat of terrorism – jihadist, right-wing or otherwise – persists; and the advancement of technology provides an ever-expanding range of financial opportunities for bad actors.

Yet the focus on countering the financing of terrorism in Europe has diminished, becoming a technical issue pursued to meet FATF requirements rather than a central part of the bloc’s anti-terrorism defenses.

This shift in focus has been strongly informed by my own experience and that of my colleagues at RRUSI Europe over the past few years.

In January 2020, supported by the European Commission’s Fund for International Security (Police), we embarked on a three-year project to assess and promote collaboration, research and analysis against terrorist financing , called Project CRAAFT. But while member countries voluntarily engaged in workshops and other activities, as the project progressed it became clear that their motivation was more a function of FATF requirements, rather than being motivated by the more practical and safety-oriented intentions of the Commission’s action plan. and the desire to protect their citizens.

Why is it?

To be sure, other distractions have intervened: the EU has been consumed by addressing failings in its members’ anti-money laundering supervision, as it has been revealed that a wide range of banks have left the doors wide open to criminal and malicious finance. More recently, Russia’s war of aggression in Ukraine has also presented a far more immediate security challenge for the bloc than the threat of retreat posed by terrorism.

But it is also the case that the possibilities offered by the investigation of financial transactions and the associated intelligence remain misunderstood by many in policy circles, as they place unwavering faith in the standards demanded by the FATF. But these standards represent a minimum requirement, not a basis on which to truly leverage financial intelligence as a tool in the fight against terrorism.

Thus, the EU’s response to terrorist financing risks reverting to the status quo ante – a sleepwalking response driven not by the Action Plan’s mission statement but by a technocratic desire to uphold anti-financial crime standards.

It is a dangerous road to follow. Countries that score high in the FATF assessment of responses to terrorist financing – such as France and the UK – have suffered some of the most punitive attacks. And the FATF’s definition of effectiveness offers little assurance of security for European citizens.

At a time when authorities are beset by many challenges, from cost of living crises to energy price shocks to a war on EU borders, it would be naïve to imagine the resources that have devoted to countering the financing of terrorism five to seven years ago are still available today. But that does not excuse policymakers and political leaders from constantly assessing how the bloc’s defenses can be strengthened against terrorist financing, adapting to the changing nature of the threat landscape and available financial technology. for bad actors.

What is clear from the CRAAFT project is that member countries are still struggling to effectively address the threat posed by terrorist financing. The challenges and opportunities presented by new technologies and new payment methods require much deeper study; the intersection between organized crime and terrorism is poorly understood; and policymaking has stagnated.

Although the wave of terrorist attacks that afflicted the EU following the Paris attacks in 2015 may have subsided, the importance of the lessons that should have been learned have not diminished. And yet, the political community has seemingly – and irresponsibly – evolved.

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