18/11/2022

Relevance: GS-3: Role of External State and Non-state Actors in creating challenges to Internal Security, Linkages of Organized Crime with Terrorism; Important International institutions, agencies, their structure and mandates.

Key Phrases: No Money for Terror Conference, Crowdfunding terror, Terror financing, Terror financing methods, Channels of funds to terrorists, UNSCR resolution 1267.

Context:

• The Government of India announced recently that Pakistan and Afghanistan have opted out of the two-day ‘No Money For Terror’ Ministerial Conference starting in New Delhi from Friday.
• There is a confirmation awaited from China for its presence at the event.

Key Highlights:

• The conference is part of India’s concerted efforts to keep pushing the global leadership against the terrorism and curb its spread.
• This international “No Money For Terror” conference along with special UNSC briefing (which will be held in December) is part of a series of measures that the Government appears to be making to keep up the momentum from the recently held Counter Terrorism Committee (CTC) meet.
• Over 78 nations and multilateral organizations, including ministers from 20 countries, will be attending the third edition of the conference being inaugurated by the Prime Minister of India.
• The conference will have four sessions-
  • Global Trends in Terrorism and Terrorist Financing.
  • Use of Formal and Informal Channels of Funds for Terrorism.
  • Emerging Technologies and Terrorist Financing.
  • International Co-operation to Address Challenges in Combating Terrorist Financing.

What is the Agenda of the conference?

• The conference agenda does not include country-specific discussions rather the participants will discuss issues ranging from sources of terror to the threat or its funding.
• India is expected to draw global attention towards issues such as-
  • Lack of universal consensus on laws regarding cybercrimes.
  • Weak control of social media platforms and their misuse by terrorist and extremist groups.
  • Dark web and crypto-currency related issues.
  • Crowdfunding along with anonymous, decentralized and untraceable nature of terror financing.
• It will also focus on effective multilateral and multi-stakeholder approaches in identification and mitigation of threats of emerging terror-financing mechanisms.
• Deliberation on misuse of non-profit and non-government organizations as front structures for financing terror activities.

Channels and sources of funds to terrorists

• Direct smuggling of cash through international borders along with movement of goods through the trade system.
• Use of hawala networks with the support of local criminals, fugitives etc. They also use charities and alternative remittance systems.
• Formal Banking networks including SWIFT and other international channels.
• Block chain or cryptocurrencies which transcend national boundaries and international currency systems.
• Derive funding from a variety of criminal activities: ranging in scale and sophistication from low-level crime to organized fraud or narcotics smuggling or illegal activities in failed states and other safe havens.

Crowdfunding terror is a new age challenge

• The exponential growth and reach of social media platforms have posed a challenge to the governments and security forces across the globe.
  • These social media platforms are being used to raise financing, funding as crowdfunding platforms.
• These new ways of crowdfunding that are developing are critical issues that warrant close global scrutiny.

Why are the funds required?

• Funds are critical for terrorist activities as most of the activities are planned with transboundary cooperation among various groups with the help of state and non-state actors.
• The funds are usually used for following-
  • To promote a militant ideology among vulnerable and easily targeted sections such as poor youths.
  • To pay secret operatives and their family members.
  • Expenses of training of new recruitments and their travel.
  • To pay for logistics, food, forge documents and pay bribes.
  • Acquire new and modern weapons and stage attacks.

Efforts to tackle terror financing

• At National level
  • The Prevention of Money Laundering Act, 2002 (PMLA) to prevent money-laundering and to provide for confiscation of property in money-laundering and related matters including the terrorist activities.
  • The National Investigation Agency, a specialized agency to deal with terrorist offences was set up and has been functioning since January 2009.
  • The National Intelligence Grid (NATGRID) has been constituted to create an appropriate database of security-related information.
• At Global level
  • The Financial Action Task Force (FATF) which is a global money laundering and terrorist financing watchdog aims to prevent illegal activities and the harm they cause to society.
  • UNSCR resolution 1267 in 1999 and UNSCR resolution 1373 in 2001: They formed the bedrock of the financial sanctions regime for terrorist organizations.

Conclusion:

• The adaptability and opportunism shown by terrorist organizations are highly sophisticated; only accurate and well linked financial intelligence can reveal the structure of terrorist groups and also the activities of individual terrorists.
• There needs to be a global consensus on to curb terror financing and needs concerted efforts of all the International and national stakeholders.
• In India’s hosting of the “No money for terror” conference there is an opportunity for the world leaders which should go a long way in focusing on the issue of state sponsored terror financing.

Source: The Hindu BL

Mains Question:

Q. For a peaceful world curbing terror financing through global cooperation is essential. Discuss the statement in light of India’s targeted efforts towards terror financing. Also write on terror financing and the channels of funds flow to the terrorists? (150 words)