Ten myths about terrorist financing

Pages189-205
DOIhttps://doi.org/10.1108/13685200910951938
Publication Date08 May 2009
AuthorW.A. Tupman
subjectMatterAccounting & finance
Ten myths about terrorist
financing
W.A. Tupman
Centre for Police and Criminal Justice Studies,
University of Exeter, Exeter, UK
Abstract
Purpose – The purpose of this paper is to present ten myths of terrorist financing policy.
Design/methodology/approach Itisarguedthatpost9/11 literature on terrorism
misunderstands the relationship between the component parts of a political movement with an
armed wing and thus misrepresents the nature of terrorist financing applies the literature on
crime as a business to policy on terrorist financing and concludes that there are loosely-organised
networks that engage in the fund-raising processes of the political movement as a whole as well
as its armed wing.
Findings – Financing methods vary with type of group and over time. That terrorist/paramilitary
funding increasingly parallels the business of organised crime and that what is claimed to be known
about terrorist funding is mostly erroneous. That funds seized have not been primarily for terrorist
financing and that the seizure has done more harm than good.
Practical implications – Thought needs to be given to the impact of funding seizures more that
simply in terms of newspaper headlines.
Originality/value – More effective impact can be made upon terrorist financing if a more complex
approach is taken, rather than perpetuating the existing myths, which alienate more communities than
they deter terrorists.
Keywords Terrorism, Financing,Crimes
Paper type Research paper
Like “terrorism”, ”myths” are hard to define. Essentially, they are sacred stories
accounting for the origin of the world and various natural phenomena. In common
parlance they are considered falsehoods, which offends those who hold them sacred.
“Terrorism” was once used to denote a specific form of political violence, but is now
more frequently used as a pejorative term. In September 1977 Antony Arblaster
published an article in which he reviewed 11 mid-seventies books on terrorism and
brought “myths” and “terrorism” into the same bed. At the time, he identified. Nine
major problems with the literature, most of which remain relevant. I published a
commentary on the review in the early 1980s (Arblaster, 1978; Tupman, 1988, 1998a)
and, following Arblaster (1978), I have, in this paper, selected ten basic myths from the
policy discussions of terrorist financing.
The top ten myths:
(1) We know what “terrorism” is and how it differs from insurgency and other
forms of political violence. (converse myth: everything we do not like can be
called “terrorism”).
(2) We also can draw a clear distinction between terrorism and organised crime
(there is a converse myth here too: there is no distinction between terrorism and
organised crime).
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1368-5201.htm
Terrorist
financing
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Journal of Money Laundering Control
Vol. 12 No. 2, 2009
pp. 189-205
qEmerald Group Publishing Limited
1368-5201
DOI 10.1108/13685200910951938
(3) The armed wing of a political movement is funded in exactly the same way as
every other sector of that movement and therefore every activity of that
movement is involved in terrorist financing. This myth overlaps intellectually
with the next one.
(4) Terrorist organisations are Weberian pyramids with everything controlled by a
small group that holds the purse strings. There is no autonomy for individu al
cells, regional organisations, no sectoral separation by function. This is at odds
with the whole notion of a cellular structure which revolutionaries created as
early as 1860 to prevent penetration by the security forces. It is also a distortion
of the power relationships between the elements of a political movement with an
armed wing. Funding will follow the same rules for the same reasons. Funds are
raised for specific operations; for overground activities; for prisoner support; for
poverty relief, for associated organisations such as sports clubs. Each activity is
kept independent, although undercover activists may well be planted within
those organisations. Sleeper cells also exist, separate again to be activated for a
specific purpose only.
(5) Terrorism is a homogenous phenomenon. It is not. There are many different
types of group and the funding mix will consequently also be different.
(6) All a terroristgroup does is fight. In fact, there is a fundamentalmisunderstanding
of the services delivered to a population by a political movement with an armed
wing. Violence and contract enforcement are essential service where the state is
weak. Stamping out underground banking services is not a good idea because it
allows thesegroups to provide them instead. TheMaoist provision of land reform
was key to successful Rural Guerrilla warfare, and the problem for Urban
Guerrillas was finding a substitute where they could provide services/economy,
etc.to some degree. Security, contractenforcement, policingare all areas into which
these groups can move.
(7) al-Qaeda was a sophisticated multi-million pound business with tentacles into
stock markets, the internet.
(8) There is something called “New Terrorism” which is so different that it
invalidates all previous knowledge about terrorism. It can thus be dealt with in
exactly the same way as drugs, so the experience from the “successful” war on
drugs can be applied to a “successful” war on terrorism. Follow the money!
(9) Huge amounts of money have been seized since 9/11 undermining terrorist
organisations all over the world. In fact, of the small amount seized, a large
percentage has had to be returned, as it was found by courts to have been seized
illegally.
(10) There is no difference between terrorist money laundering and all other forms
of money laundering. This debate has been ducked by FATF. Originally the
argument was about the fact that in “normal” money laundering, there is a
predicate offence, whereas in “terrorist” “money laundering”, the offence occurs
subsequently. There is no room to deal with this debate here.
The oversimplification of the relationship between the component parts of a political
movement with an armed wing leads counter-terrorist policy down roads where
unsophisticated action can produce the reverse of the result desired. What we refer to
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