Terrorists need money for terrorist activity. Terrorist financing provides funds to terrorists. They use these funds for training, accommodation, buying weapon, etc.
So, how are these funds provided?
- Money obtained by illegal means. Like a donation.
- Money obtained by money laundering. For example; smuggling, drug trade, extortion, kidnapping, fraud.
They use money laundering methods in order to use these illegally earned money more easily.
Anti-money laundering is key to CFT. Financial institutions play an important role in combating the financing of terrorism because terrorists often rely on it, especially banks, to transfer Money. Therefore, many laws and regulations have been enacted to prevent terrorist financing. It is known as counter-terrorist policies. According to these policies, financial institutions should know their customers closely. It must monitor and keep records of customers’ transactions. In this way, organizations can have sufficient information about their customers and ensure that their customers are not involved in a financial crime. If funds are found to support terrorist activities, law enforcement agencies may be able to prevent some of those activities.
THE FATF - Financial Action Task Force
The FATF (Financial Action Task Force) on the Prevention of Money Laundering was established in 1989 by the G-7 countries. FATF, which is composed of 35 countries and two regional organizations, works to combat money laundering and the financing of terrorism through creating standardized processes to stop threats to the international financial system. Terrorists can infiltrate into the financial system of countries with weak controls. By creating standardized procedures, terrorism financing becomes harder to hide.
Protect your business with our growing sanction screening tool. Ensure transparency in your business by scanning regularly with our PEP & Sanction lists. Please don’t hesitate to contact us for more information.