{"id":44004,"date":"2018-11-30T13:17:14","date_gmt":"2018-11-30T02:17:14","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=44004"},"modified":"2018-11-30T13:17:14","modified_gmt":"2018-11-30T02:17:14","slug":"the-terror-cyber-crime-nexus-and-terrorists-innovation","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/the-terror-cyber-crime-nexus-and-terrorists-innovation\/","title":{"rendered":"The terror\u2013cyber\u2013crime nexus and terrorists\u2019 innovation"},"content":{"rendered":"
<\/figure>\n

Despite herculean efforts, countering terrorist financing<\/a> has proven to be hard.<\/p>\n

The reasons for that include the complexity of the international financial system, some states\u2019 reluctance to enforce existing measures, and terrorist groups\u2019 ability to innovate and diversify to obtain new sources of funds and hide what they have.<\/p>\n

While the terror\u2013crime connection is very old (from Russian anarchists in the 19th century to the US Weathermen in the 1970s), new technologies mean that we now face a terror\u2013cyber\u2013crime nexus.<\/p>\n

Islamic State promoted what Magnus Ranstorp<\/a> has called \u2018microfinancing\u2019 of the caliphate and encouraged \u2018gangster jihad<\/a>\u2019, enabling it to amass<\/a> nearly US$6\u00a0billion in 2015 (including about $500\u00a0million from oil and gas, $360\u00a0million from \u2018taxes\u2019 and extortion, and $500\u00a0million from looting bank vaults in Mosul).<\/p>\n

The cash allowed it to invest in its \u2018Committee for Military Manufacturing and Development\u2019, which distributed weapons and ammunition across the caliphate and constructed new weapons, such as vehicle-borne improvised explosive devices, on an industrial scale. Well-armed and well-funded, IS proved very effective in multi-domain military operations<\/a>.<\/p>\n

Despite its diminished territorial footprint (it now controls less than 1% of the area it did in 2017), the group\u2019s ability to make money remains largely unaffected. International commitment to sanctioning<\/a> IS-associated money launderers and financial facilitators has been limited.<\/p>\n

IS has a network<\/a> that operates across the globe, raising funds from multiple sources, ranging from individuals\u2019 donations to illicit oil deals, including with the Assad regime (absurdly, for years the regime and IS have been trading<\/a> illicit oil through Muhammad al-Qatirji and his Qatirji Company).<\/p>\n

Anecdotal<\/a> evidence indicates that IS and other jihadist groups are now deepening their exploitation of the cybersphere. For example, they\u2019re very interested in cryptocurrencies; at least one Islamic scholar has declared<\/a> bitcoin permissible under sharia law, and the person-to-person bitcoin exchange LocalBitcoins lists<\/a> three bitcoin sellers in Syria.<\/p>\n

In 2014, IS supporter Ali Shukri Amin argued<\/a> that Salafi-jihadis should use bitcoin rather than the currencies of the infidels. He noted that the financial system prevents individuals from supporting the mujahidin<\/em>, as bank transfers are recorded.<\/p>\n

Junaid Hussain\u2014who rose to become the number\u00a03 leader of IS and was on the US government\u2019s most-wanted list before a Hellfire missile took him out<\/a> in 2015\u2014combined a unique form of hacktivism with terror while he led the CyberCaliphate hacker group. He worked with Ardit Ferizi<\/a>, a Kosovar hacker, who was arrested in Malaysia, extradited to the US and sentenced to 20\u00a0years for providing material support to America\u2019s enemies. Ferizi had hacked the personal data of more than 1,300 American military and government personnel on an online retailer\u2019s fileserver and given the data to IS, which then disseminated<\/a> a \u2018kill list\u2019. Notably, Ferizi had demanded<\/a> a payment of two bitcoins (worth at the time around $500) in exchange for leaving the server alone and explaining how he\u2019d hacked it.<\/p>\n

In December 2017<\/a>, a woman was arrested in New York for obtaining $62,000 in bitcoin to send to IS. She had initially tried to travel to Syria, but, when that failed, she used false information to acquire loans and multiple credit cards, which she turned into bitcoin and other digital currencies before sending it via Pakistan, China and Turkey to fund IS.<\/p>\n

In 2017, the Jeddah-based Islamic Research and Training Institute, a research wing of the Islamic Development Bank, signed an agreement with Belgium-based SettleMint and Ateon to look at the feasibility of an Islamic blockchain. The institute was seeking to ensure that the technology is compliant<\/a> with sharia law, which prohibits riba<\/em> (interest, usury) and requires all financial transactions to have \u2018material finality\u2019.<\/p>\n

In 2018, Mufti Muhammad Abu Bakar, a sharia adviser and compliance officer at Blossom Finance in Jakarta, drafted a paper arguing that bitcoin is permissible under Islam because in places such as Germany it\u2019s recognised as legal currency. Earlier this year, at the annual sharia conference of the Accounting and Auditing Organization for Islamic Financial Institutions, time was allocated to discuss bitcoin to determine whether it is riba<\/em>, which is prohibited, or ribawi<\/a><\/em> (items that are exchanged in equal measures once ownership is transferred).<\/p>\n

In other words, Islamic scholars are recognising the possibility of using cryptocurrencies more extensively.<\/p>\n

And Salafi-jihadis aren\u2019t the only ones seeking to exploit the cryptocurrency revolution. Neo-Nazi groups are also seeking to use it to raise funds. In 2017<\/a>, the Daily Stormer<\/em> website attracted around US$60,000 in bitcoin and cryptocurrency donations. The far-right neo-Nazi activist Weev, who runs the site, has collected around US$1.8\u00a0million that way.<\/p>\n

If we\u2019re to properly address the potential that cryptocurrencies offer to non-state actors, we must recognise that a Westphalian concept of sovereignty in the regulatory system gives our adversaries an advantage, as jihadist and far-right groups either reject that concept or exploit it.<\/p>\n","protected":false},"excerpt":{"rendered":"

Despite herculean efforts, countering terrorist financing has proven to be hard. The reasons for that include the complexity of the international financial system, some states\u2019 reluctance to enforce existing measures, and terrorist groups\u2019 ability to …<\/p>\n","protected":false},"author":606,"featured_media":44006,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"footnotes":""},"categories":[1],"tags":[273,1801,1669,127],"class_list":["post-44004","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-counterterrorism","tag-cybercrime","tag-financial-crime","tag-terrorism"],"acf":[],"yoast_head":"\nThe terror\u2013cyber\u2013crime nexus and terrorists\u2019 innovation | The Strategist<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.aspistrategist.ru\/the-terror-cyber-crime-nexus-and-terrorists-innovation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The terror\u2013cyber\u2013crime nexus and terrorists\u2019 innovation | The Strategist\" \/>\n<meta property=\"og:description\" content=\"Despite herculean efforts, countering terrorist financing has proven to be hard. 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