Dirty money

The Financial War on Terrorism
OECD Observer

Terrorism is deadly and criminal, yet, it is a business. Agents are paid, their weapons are purchased, and their plots are financed. Their organisations raise, transfer, invest and spend hundreds of millions of dollars every year, whether investing it or laundering it. Whatever the political or ideological motivations, terrorism requires money.

The Financial Action Task Force (FATF) has spearheaded the global campaign against money laundering since it was established in 1989 by the G7 and the European Commission. After 9/11, its responsibilities were widened to include the fight against financing terrorism. It has identified the tricks of the terrorist trade, such as dummy companies set up to house assets and run bank accounts, or charities that are used with or without their knowledge and consent, to collect, transfer and pay out money. Terrorist funds are mixed into businesses, which may or may not be otherwise legitimate, and shipped from country to country using wire transfers, underground moneychangers and black market operators.

In several European countries, police have found front companies in activities as diverse as publishing, real estate and fisheries. US investigators have found delicatessens doubling as fund collection centres, with multimillion transfers broken down into hundreds of smaller transactions in a bid to slip through normal banking channels.

The worldwide proliferation of informal, unlicensed money remittance schemes is another problem. Although they might help migrants as an essential way of transferring money home, they are vulnerable to criminal and terrorist exploitation. For example, several remittance structures were set up to serve the needs of some 750,000 migrants and refugees from Somalia. One of these, Al Barakaat, was later identified as a funding channel for Al-Qaida.

The Financial War on Terrorism is a practical guidebook for legislators, financial regulators and others involved in interdicting the financing of terrorists and their organisations. It sets out a stepby- step roadmap, including the FATF’s revised and updated recommendations on measures required to block criminal financial activity and help put terrorists out of business.

©OECD Observer No 242, March 2004




Economic data

GDP growth: +0.6% Q2 2018 year-on-year
Consumer price inflation: 2.9% Sept 2018 annual
Trade: +2.7% exp, +3.0% imp, Q4 2017
Unemployment: 5.2% Sept 2018
Last update: 13 Nov 2018

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive paper editions delivered to you directly


Online edition
Previous editions

Don't miss

  • Globalisation will continue and get stronger, and how to harness it is the great challenge, says OECD Secretary-General Gurría on Bloomberg TV. Watch the interview here.
  • OECD Secretary-General Angel Gurría with UN Secretary-General António Guterres at the 73rd Session of the UN General Assembly, in New York City.
  • The new OECD Observer Crossword, with Myles Mellor. Try it online!
  • Watch the webcast of the final press conference of the OECD annual ministerial meeting 2018.
  • Listen to the "Robots are coming for our jobs" episode of The Guardian's "Chips with Everything podcast", in which The Guardian’s economics editor, Larry Elliott, and Jeremy Wyatt, a professor of robotics and artificial intelligence at the University of Birmingham, and Jordan Erica Webber, freelance journalist, discuss the findings of the new OECD report "Automation, skills use and training". Listen here.
  • Do we really know the difference between right and wrong? Alison Taylor of BSR and Susan Hawley of Corruption Watch tell us why it matters to play by the rules. Watch the recording of our Facebook live interview here.
  • Has public decision-making been hijacked by a privileged few? Watch the recording of our Facebook live interview with Stav Shaffir, MK (Zionist Union) Chair of the Knesset Committee on Transparency here.
  • Can a nudge help us make more ethical decisions? Watch the recording of our Facebook live interview with Saugatto Datta, managing director at ideas42 here.
  • The fight against tax evasion is gaining further momentum as Barbados, Côte d’Ivoire, Jamaica, Malaysia, Panama and Tunisia signed the BEPS Multilateral Convention on 24 January, bringing the total number of signatories to 78. The Convention strengthens existing tax treaties and reduces opportunities for tax avoidance by multinational enterprises.
  • Rousseau
  • Do you trust your government? The OECD’s How's life 2017 report finds that only 38% of people in OECD countries trust their government. How can we improve our old "Social contract?" Read more.
  • Globalisation’s many benefits have been unequally shared, and public policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside governments and international organisations to help improve and harness the gains while tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
  • Checking out the job situation with the OECD scoreboard of labour market performances: do you want to know how your country compares with neighbours and competitors on income levels or employment?
  • Trade is an important point of focus in today’s international economy. This video presents facts and statistics from OECD’s most recent publications on this topic.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .
  • Visit the OECD Gender Data Portal. Selected indicators shedding light on gender inequalities in education, employment and entrepreneurship.

Most Popular Articles

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2018