deterrence is largely irrelevant, with the language of terrorists often entirely divorced from that of the normal criminal offender.”26
Moreover, it is impossible to estimate the extent and spread of terrorists’ involvement in criminal (organized) activities.27 In 2003, in the United States, it was reported that fourteen of the thirty-six groups designated as terrorist organizations on the U.S. Department of State list were engaged in drug trafficking.28 This fact was applied to argue that the war on drugs and the war on terrorism need to continue to be linked. However, this conclusion was correctly criticized as “there are hundreds of terrorist organizations and drug trafficking groups, but it is usually the same dozen or so groups that get identified as being involved in both types of activities.”29
From an international law perspective, the inclusion of the concept of terrorism within the scope of international instruments relating to organized crime is also problematic. The problem lies in the nature and definition of terrorism. While there is not a consensus on a concrete definition of terrorism, and on the designation of groups as terrorist groups, certain characteristics of organized crime have been at least identified over the course of time.30 With regard to this fact, the inclusion of terrorism in instruments related to organized crime has the potential to “divide parties to a treaty and make it unworkable.”31 It might be the reason why the authors of the UN Convention against Transnational Organized Crime (also called the Palermo Convention) avoided the inclusion of terrorist acts in the definition of organized crime32 in spite of acknowledging the involvement of terrorists in criminal activities.33
By exemplifying the practices of few terrorist groups, it is also argued that “terrorist groups are now turning gradually into a big business . . . and enjoy the unexpected fruits of their way of life.”34 However, regarding the paucity of available data, it does not make sense to claim that such transformation is a typical or common pattern for all terrorist groups.35 Moreover, from a criminal law perspective, if a terrorist group is transformed into some sort of a criminal organization, it can no longer be considered as a terrorist group.
To end this, it is worthwhile to note the result of the questionnaire administrated by the United Nations Office on Drug and Crime (UN Terrorism Prevention Branch) indicating that36
terrorist groups are frequently involved in other crime, particularly illegal drug trafficking, smuggling of migrants, falsification of illicit travel and identity documents, trafficking in firearms and other exploitation of illicit markets. However, the responses did not provide strong evidence of organizational links between terrorist groups and organized criminal groups. There was no indication either that criminal groups were becoming more involved in terrorist acts.37
Even if there is a strong link between terrorist groups and organized criminal groups, why are not they prosecuted under ordinary criminal law? Why is it so important to make a doctrinal link between terrorism and in some way amalgamate those activities?
Terrorists’ Involvement in Money Laundering
Unlike the first assumption which emphasizes inaccurately and exaggeratedly the illegal sources of terrorist funds, the second assumption focuses on the tools and methods which terrorists use to conceal the flow of their funds.38 This assumption acknowledges that although terrorist funds can be derived from both legal and illegal sources, terrorists process their funds—“that is, move them from the source to where they will be used”—in the same way that nonterrorist criminals launder funds.39
In other words, terrorists are involved in either money laundering or “reverse money laundering.” If terrorists are involved with criminal activities, they need to use the same methods as criminals to conceal the origin of proceeds. If terrorist funds have a legitimate origin, then terrorists must engage in “reverse money laundering,”40 which is the application of the same methods and tools used by launderers to hide the destination of funds. In this regard, it has been noted that
terrorists use the same professional money network, they use the same convoluted transactions to hide the location of the money or where it’s going. They can use the same clandestine shipment of cash to avoid paper-trails. They can engage in the same international shell games as they move money from this account to that, disguised as legitimate funds for some lawful purpose when it really is to finance new crime and new criminal enterprises. . . . The source of the money doesn’t matter, it is the deadly purpose the money was intended to fund.41
As a result of this analogy, it is concluded that there is significant room for anti-money laundering measures to deal with the phenomenon of terrorist financing. Therefore, terrorist financing is considered as a subcategory of money laundering, or a predicate crime to money laundering which potentially can be detected, investigated, and prevented by the already existing measures.42
The logic of this assumption is not compelling for the following reasons. Most of all, it is questioned whether money laundering countermeasures can be a “one size fits all” solution for all crimes in which offenders may use the same money network as launderers use to conceal the origin of their funds. The point is that these measures have been designed to prevent drug offenses or offenses43 whose purposes are the legitimization and accumulation of a huge amount of money generated from criminal activities. However, in regard to terrorist financing, none of these elements are necessarily involved. While cloaking money may be important, transmission to the point of use is a much more pressing need for terrorists.
With regard to the accumulation element, while the basic requirement in money laundering operations is to launder and accumulate a large amount of money, not only does terrorist financing end by distributing funds to terrorist cells, but also “terrorism can, and does, operate on a shoestring.”44 This affects the volume of the money circulated in terrorist-related transactions. The 9/11 Commission Report provides an interesting insight into how easy it was for the 11 September hijackers to carry out their transactions. For example, it is reported that they mainly operated through wire transfers, using sums not exceeding $10,000 each time. The members of groups were on student visas and appeared to be receiving money from their parents or in the form of grants for their studies.45 It is also emphasized that none of the hijackers’ transactions were “extraordinary or remarkable.”46
In terms of the legitimization element, when terrorists are involved in crime to finance their activities, the quick response is that they are involved in money laundering. Of course, terrorists wish to hide the illegal sources of their funds.47 However, regarding the fact that the purpose in terrorist financing is to make funds available to terrorists on the ground, not to integrate funds into financial systems,48 the question is whether the funds necessarily need to go through those complex money laundering stages and processes to become usable. The answer is positive if terrorists intend to invest proceeds to produce regular revenue.
Looking at the evidence, it is argued that while the movement of “terrorist-related funds” and transactions does not generally resemble normal transactions, it does not include complex processes used in money laundering.49 In addition, the result of a study on money laundering activities in the East and Southern African Anti-Money Laundering Group countries shows that although it was more likely that terrorist funds in this region originate from illegal sources rather than legal sources, no indication as to the link between money laundering activities and terrorist groups had been found.50
What radically challenges the assumption of the inclusion of money laundering countermeasures to terrorist financing is the fact that proceeds derived from criminal activities are not the main source of funds for terrorists.51 As mentioned in chapter 1, terrorist funds
