FINANCING OF THE TERRORIST ORGANISATION ISLAMIC STATE IN IRAQ AND THE LEVANT (ISIL)
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application or other program which stores credit) and send the number of the prepaid card via
Skype. The fundraiser would then send the number to one of his followers in close country from
Syria and sell the number of the card with a lower price and take the cash which was afterwards
provided to ISIL.
Source: Saudi Arabia
ISIL has manipulated social media, physical and virtual social networks, encouraged donations and
conducted a marketing campaign in a manner that is consistent with industry standards established
by major crowdfunding companies. Crowdfunding is a method of drawing donations from a large
group of people through a combination of technology and marketing. Leading crowdfunding
platforms have used statistical analysis to optimize online crowdfunding campaigns through the
encouragement of “perks” or “donation tiers.”
60
Through “donation tiers”, a prospective donor is
better able to connect with the cause and feel the immediacy of donations, thereby increasing and
incentivizing larger contributions. These companies also prescribe specific marketing actions for
campaigns which employ different forms of social networking in order to develop support, maintain
campaign momentum, and maximize profits.
61
Case Study 9: Use of Social Media to Raise Funds
On 31 May 2014, an individual was arrested and charged by criminal complaint with two counts of
receipt and possession of an unregistered firearm silencer. On 16 September 2014, a federal grand
jury in Rochester, New York, returned a seven-count indictment charging him with three counts of
attempting to provide material support and resources to ISIL, among other charges.
According to the criminal complaint, the individual has used Twitter to post and re-post tweets
expressing support of various terrorist groups and violent extremism, and seeking donations to
assist foreign terrorist fighters in Syria. The complaint alleged that he stated that money is the
largest resource for extremists and people should fight with their money as well as with their bodies
and words. He urged people to donate money, often times a third of their salary, as it is considered
a type of jihad. These tweets would sometimes list specific weapons and the amount needed to
purchase them. One example included asking for specific cash donations of 5,000 USD from each
family. Charges contained in an indictment and/or criminal compliant are merely allegations, and
under US law all defendants are considered innocent unless and until proven guilty in a court of law.
Source: United States
Crowdfunding was observed early in the Syrian civil war as used by rebel groups.
62
According to
press reports, the funds arranged through social media by these Syrian rebel
groups were
60
Indiegogo Playbook (2014).
61
Indiegogo Field Guide (2014).
62
Ackerman, S., (2012).
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2015
commonly wired between private bank accounts and transported across borders by cash couriers.
63
Pledges took the form of several options ranging from the purchase of a single weapon to the
funding of an operation or paying for the travel, training and arming of a volunteer fighter.
64
In
return for subscribing to a certain donation tier, contributions were commonly reinforced with
visual documentation of how the donations were utilized.
65
An example of the aforementioned
“perk” or “donation tier” development was posted by the twitter account Jahd_bmalk, an ISIL and
AQ-linked cleric, who was seeking donations for weapons. In this post, the cleric promised that if 50
dinars is donated, equivalent to 50 sniper rounds, one will receive a “silver status.”
66
Likewise, if
100 dinars is donated,
which buys eight mortar rounds, the contributor will earn the title of “gold
status donor.”
67
An attempt to raise funds via the internet is not only characteristic of key players in
ISIL’s ranks, but also applies to those who wish to support its campaign.
63
Warrick, J. (2013).
64
Id.
65
Id.
66
Gilligan, A. (2014).
67
Id.
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III. MOVEMENT AND USE OF FUNDS AND OTHER ASSETS
1. FINANCIAL INSTITUTIONS
ISIL’s operations in large parts of Iraq and Syria give it access to scores of bank branches with
operations in these areas. As noted below, the Iraqi government has taken steps to prevent these
bank branches from accessing the international financial system through their headquarters, which
retain access to the international financial system through correspondent relationships with foreign
banks. These accounts could be used to finance trade and to facilitate transfers to and from Syria
and Iraq. As the conflict in Syria and Iraq prolongs, there are indications that the conflict, and
Syria’s underdeveloped banking sector, are forcing funds into financial institutions in the immediate
surrounding region.
Case Study 10: Use of Funds transfers
According to sensitive financial information, terrorist financing risks were discovered regarding the
use of both Electronic Funds Transfers (EFTs) via banking channels and other transfers via Money
Value Transfers Systems (MVTS) to areas located near territories where ISIL operates or designated
individuals. The location of the receipt of these transfers were often located in areas known to be a
funding, logistical and smuggling hub for foreign terrorist fighters and terrorist organisations. In
some of these cases, social media have suggested that beneficiaries of funds transfers may have links
to terrorist or radical groups. In other cases, excessive cash deposits were made in the US with
subsequent wire transfers to beneficiaries in areas located near territories where ISIL operates.
Risks identified also included lack of information of the purpose of the wires, the relationship of the
receivers or the reason funds transfers were conducted in multiple transactions over short time
periods.
Source: United States
1.1 FINANCIAL INSTITUTIONS IN IRAQ
After the fall of Mosul in June 2014 and ISIL’s successive moves into additional provinces in Iraq,
there was a strong concern that ISIL could access the international financial system through Iraqi
bank branches in territory where it operates. Iraqi banks are largely headquartered in Baghdad, but
have branches located throughout Iraq which can process funds transfers via their headquarters in
Baghdad through the international financial system. Based on industry reporting and contacts,
approximately 90 Iraqi bank branches are located in territory that is either held or contested by
ISIL, including in and around the provinces of Nineveh, Salah Din, Anbar, and Kirkuk.
In an effort to prohibit ISIL from exploiting Iraqi banks to access the international financial system,
the Central Bank of Iraq issued instructions to financial institutions incorporated in Iraq to prevent
wire transfers to and from banks located in ISIL-held territory. The sole bank headquartered in
Mosul, Mosul Development Bank, also moved its center of operations to Baghdad in order to
mitigate the risks of connecting to the international financial system from its primary location in
ISIL-held territory.