About the Book

Terrorism finance has aptly been termed as the lifeblood of terrorism. Yet, this remains one of the most under researched facets of terrorism. This limitation is even more apparent in the Indian context, despite the fact that the country has faced the scrouge of terrorism and insurgency for over five decades. Lifeblood of Terrorism: Countering Terrorism Finance, is the first book on the subject in an Indian context. The book contextualises the concept of terrorism finance to local realities based on distinct peculiarities as related to India. It documents the sources, transfer mechanisms and employment of funds for supporting organisational structures and acts of terrorism. The book also analyses two case studies to highlight in detail the methods employed for external and internal funding. The challenges associated with terrorism finance are further related to contributing factors which have aggravated the threat.

A SWOT analysis of existing sources, challenges and approach to terrorism finance is employed to suggest a strategy for countering the financing of terrorism. The strategy recommends measures at the policy planning level to curb the threat at the source of terror funding, transfer stage and during distribution of finances. The book further suggests organisational changes to improve the approach to terrorism finance without undertaking major restructuring of the existing setup.

About the Author

Colonel Vivek Chadha (Retd), served in the army for over 22 years, before taking premature release to pursue research. He is a Research Fellow at the Institute for Defence Studies and Analyses (IDSA), New Delhi. He has written extensively on counterterrorism and counterinsurgency in the Indian context. His single author books on the subject of terrorism include, Low Intensity Conflicts in India – An Analysis and Company Commander in Low Intensity Conflicts. In addition, he has contributed a number of chapters in edited books, papers in journals and articles for newspapers. He is the co-editor of the annual Asian Strategic Review and is on the editorial board of the Journal of Defence Studies at IDSA.

Contents

Introduction

Countering the Challenge

Relevance of Countering the Financing of Terrorism

Contextualising the Argument

Shaping the Approach

SECTION I: SOURCES AND CHALLENGES OF TERRORISM FINANCE

1. Existing Assessment of the Sources and Linkages Between Terrorism Finance, Money Laundering and Crime

   Identification
   Assessment
   Crime, Money Laundering and Terrorism Finance Nexus

2. External Sources of Terrorism Finance

   NGO s, Charities and Donations
   Counterfeiting of Currency
   Narco Finance
   State Sponsorship
   Means of Transfer
   Case Study: Fake Indian Currency Notes
   Origin of Fake Indian Currency Notes
   Creation of a National Network
   Modus Operandi
   Routes Employed for Transfer of Fake Indian Currency Notes
   Implications of Conviction

3. Internal Sources of Terrorism Finance

   Extortion and Taxation...
   Crime
   Non-Governmental Organizations
   Designated Non Financial Businesses and Professions
   Means of Transfer
   Case Study of the United National Liberation Front

4. Contributing Factors

   Identification and Evaluation of Threat
   Corruption
   Shortage of Manpower
   Capacities
   Coordination
   Forensic Training
   Prosecution and Conviction
   Speed of Trial

5. Funding Patterns and Trends

   Generational Funding
   Diversity of Sources
   Narco Terrorism
   Trans Border Mobility
   Counterfeiting
   Conclusion

SECTION II: International Guidelines and Case Studies

6. International Guidelines for Countering the Financing of Terrorism
   
   UN Guidelines
   Financial Action Task Force
7. Assessment of the US and EU CFT Initiatives
   
   US Strategy
   European Union Strategy
   Assessment of US the and European Union Models

SECTION III: Strateg y for Countering the Financing of Terrorism

8. Existing Countering the Financing of Terrorism Framework and Purpose of a Strategy
   
   Existing Framework
   Purpose of Strategy
   Long Term Vision
9. Strategy for Countering the Financing of Terrorism
10. External Sources

    Counterfeit Currency
    D rug Trafficking
    Non-Governmental Organizations/Charities
    State Funding
    Means of Transfer

11. Internal Sources

    Extortion
    Charities and Non-Governmental Organizations
    Crime
    Designated Non-Financial Businesses and Professions
    Means of Transfer

12. Contributing Factors

    Identification and Evaluation of Threat
    Corruption
    Need for a Unified Mechanism
    Coordination
    Legislative Support
    International Co-operation
    Border Management
    Building Strength of Forces
    Freezing Financial Assets
    Private Sector
    Capacity Building and Training
    Prosecution and Speed of Trail
    Conclusion

13. Countering the Financing of Terrorism Organisation: Assessment and Options

    Countering the Financing of Terrorism Agencies
    Policy Agencies
    Criminal Justice and Operational Agencies
    Evaluation of the Organisational Structure
    Recommendations

Annexures

Annexure 1: SWOT Analysis
Annexure 2: Statement of Manjunath J.
Annexure 3: Seizures Made by DRI
Annexure 4: The FA TF Recommendations: February 2012

Index

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