Weakening terror financing

Add as a preferred source

SECURITY experts and analysts have long identified ‘funding’ as the main breathing oxygen that continues to keep terrorists relevant in the cause of perpetrating their heinous crimes. They equally suggested that combating this hydra-headed monster called insecurity requires an urgent need to cut off the sources of finances for the terrorists. And this very important task requires a multi-stakeholder approach involving various financial and anti-graft institutions, including the Economic and Financial Crimes Commission (EFCC), the Central Bank of Nigeria (CBN), other commercial banks, and the Nigerian Financial Intelligence Unit (NFIU), among others. According to the EFCC, about 70 percent of financial crimes in Nigeria are traceable to the banking sector. And this may ultimately serve as a source for terrorism financing. It is against this background that General Christopher Gwabin Musa, the Chief of Defence Staff, CDS, lately appealed to the EFCC to track down the sources of funding for terrorists and terrorist organisations in the country with a view to disrupting their chain of activities. According to Statista, between 2018 and 2023, the risk index score for money laundering and terrorist financing in Nigeria remained stable at around 6.9 points. The index score is used to “indicate the risk level, i.e., the vulnerabilities of money laundering and terrorist financing within a country.” The higher the number, the higher the risk.

The risk of money laundering and terrorist financing is measured by using several indicators, such as the rule of law and financial regulations. Nigeria is one of the countries with the highest terrorism threat levels in the world. In 2022, it recorded the eighth-largest number of deaths related to terrorism worldwide. The Inter-Governmental Action Group against Money Laundering in West Africa stated in a report titled “Terrorist Financing in West Africa” that terrorists and terrorist organisations use both legitimate and illegitimate means to raise funds and formal and informal channels to move cash around. Terrorism in Nigeria has become a persistent threat, casting a long shadow over the nation’s security and development. While military operations and intelligence gathering are vital components of the fight, a lesser-discussed yet equally critical aspect is tackling the financial networks that fuel these organisations. Terrorist groups, like any organisation, require money to function. Disrupting their financial lifelines can significantly cripple their ability to operate, recruit, and carry out attacks. Terrorist organisations in Nigeria employ a diverse range of methods to raise funds through various means, especially criminal activities. Kidnapping, extortion, drug use, and human trafficking are all common sources of income. These activities not only raise money but also instill fear and disrupt communities. For example, bandits who abducted 16 residents of the Gonin Gora area of the Kaduna metropolis have recently demanded a ransom of N40 trillion, 11 Hilux vans, and 150 motorcycles for their release. It is obvious that if paid, a larger percentage of the money will go towards financing another cycle of terrorism.

Additionally, terrorists also blend with the civilian population to exploit legitimate businesses. They often infiltrate legitimate businesses or charities to launder money or generate funds through front companies. In some cases, terrorist groups may receive funding from external actors, either through state sponsorship or from individuals sympathetic to their cause. In the same vein, terrorists receive informal donations because individuals who share the ideology of the group may donate money, often through informal channels that are difficult to track. This call made by the military chief is very apt, as denying terrorist groups access to financial resources has a multitude of benefits, especially by reducing their operational capacity. Without money, terrorists cannot purchase weapons, explosives, or fund training camps. This directly hinders their ability to carry out attacks. Terrorist organisations often use financial incentives to attract new members. Disrupting funding makes it harder to recruit and retain fighters, thus weakening their foot soldiers. No doubt, terrorist groups rely on money to spread their message and maintain public support. By cutting off their funds, their ability to influence public opinion diminishes, thereby weakening their propaganda efforts. Similarly, money is needed for transportation, communication, and safe houses. Disrupting financial flows hinders a group’s ability to operate and plan attacks effectively.

Therefore, as stated earlier, the fight against terrorist financing in Nigeria requires a multi-pronged approach. More importantly, the need to strengthen financial regulations can never be overemphasized. Implementing robust anti-money laundering (AML) and combating the financing of terrorism (CFT) regulations is crucial. This includes stricter monitoring of financial transactions, better information sharing between banks and law enforcement, and improved customer due diligence. There is also a need to educate the public about the dangers of terrorist financing and how to identify suspicious activity, which can help prevent individuals from unknowingly contributing to these groups. Also, terrorism is a global threat, and defeating it requires international cooperation. Sharing intelligence and coordinating efforts to disrupt terrorist financing networks across borders is essential. More importantly, the government and other stakeholders should intensify efforts to address underlying grievances and triggers of insecurity. Because financial disruption is crucial, it must be coupled with efforts to address the root causes of terrorism, such as poverty, social exclusion, and lack of opportunity. In a nutshell, terrorist financing is the lifeblood of terror groups in Nigeria. By crippling their financial networks, Nigerian authorities can take a major step towards combating insecurity. Only by tackling the financial roots of terror can true security be achieved.