Terrorism, Inc.: The Financing of Terrorism, Insurgency, and Irregular Warfare

by Colin P. Clarke Ph. d.

  Notes

  CHAPTER 1

  1. Kevin D. Stringer, “Tackling Threat Finance: A Labor for Hercules or Sisyphus” Parameters, Vol. 41, No. 1, Spring 2011, pp. 101–119.

  2. Assaf Moghdam et al., “Say Terrorist, Think Insurgent: Labeling and Analyzing Contemporary Terrorist Actors,” Perspectives on Terrorism, Vol. 8, No. 5, October 2014, pp. 2–17.

  3. The most comprehensive treatment of irregular warfare is found in the Irregular Warfare Joint Operating Concept, 2007.

  4. Alan Vick et al., Airpower in the New Counterinsurgency Era: The Strategic Importance of USAF Advisory and Assist Missions, Santa Monica, CA: RAND Corp., 2007, p. 11.

  5. In Trends in Outside Support for Insurgent Movements, Byman et al. note that the LTTE and Hezballah could be considered both terrorists and insurgents because of their relentless use of terrorism in addition to a host of other tactics used to control territory. The authors go on to note that size can also be a useful distinguishing characteristic, commenting, “terrorist groups often consist of a small number of individuals, sometimes no more than a handful. Insurgent organizations, like Hizballah or the LTTE, in contrast, number in the thousands.” See Daniel Byman et al., Trends in Outside Support for Insurgent Movements, Santa Monica, CA: RAND Corp, 2001, p. 5. Also, in his research on proto-insurgencies, Byman notes that “many of the most important ‘terrorist’ groups in the world—including the Lebanese Hizballah, the Liberation Tigers of Tamil Eelam (LTTE), and the Revolutionary Armed Forces of Colombia (FARC)—are better described as insurgencies that use terrorism than as typical terrorist movements.” Daniel Byman, “Understanding Proto-Insurgencies,” Santa Monica, CA: RAND Corp, 2007, p. 1.

  6. Bard E. O’Neill, Insurgency and Terrorism: Inside Modern Revolutionary Warfare, Washington DC: Brassey’s Inc., 1990, p. 24.

  7. As Michael Marks correctly points out, there is a lack of a universally accepted definition of “failed states” and much of the international security literature has lacked nuance in its explanation. See Michael P. Marks, Metaphors in International Relations Theory, New York: Palgrave MacMillan, 2011, pp. 120–124. While it is beyond the scope of this research to delve into the debate here, suffice to say there is some literature that this author does believe goes into nuance on the differences between weak states, failed states, failing states, and collapsed states and why it matters. See Stewart Patrick, “Weak States and Global Threats: Fact or Fiction,” Washington Quarterly, Vol. 29, No. 2, 2006, pp. 27–53; Robert I. Rotberg, ed., When States Fail: Causes and Consequences, Princeton: Princeton University Press, 2004; Robert I. Rotberg, ed., State Failure and State Weakness in a Time of Terror, Washington DC: Brookings Institution Press, 2003; and I. William Zartman, ed., Collapsed States: The Disintegration and Restoration of Legitimate Authority, Boulder: Lynne Rienner, 1995.

  8. For more, see Nick Vaughan-Williams, Border Politics: The Limits of Sovereign State Power, Edinburgh: Edinburgh University Press, 2012.

  9. Michael Freeman, “Introduction to Financing Terrorism: Case Studies,” in Michael Freeman, ed., Financing Terrorism: Case Studies, Farnham: Ashgate, 2012, p. 3.

  10. Many terrorist groups operate legal businesses for a profit, including Al-Qaida. When bin Laden’s organization was based in Sudan during the early to mid-1990s, it operated several legitimate businesses, including farms that produced peanuts and honey, trading companies, a tannery, a furniture making company, a bakery, and an investment company.

  11. Daniel Byman et al., Trends in Outside Support for Insurgent Movements, Santa Monica, Calif.: RAND Corporation, 2001, p. 88.

  12. Jason Burke, Al-Qaeda: The True Story of Radical Islam, London: I.B. Tauris, 2003, p. 45.

  13. Phil Williams, “Warning Indicators and Terrorist Financing,” in Jeanne K. Giraldo and Harold A. Trinkunas, Terrorism Financing and State Responses: A Comparative Perspective, Stanford: Stanford University Press, 2007, pp. 76–77.

  14. Sidney Weintraub, “Disrupting the Financing of Terrorism,” Washington Quarterly, Vol. 25, No. 1, Winter 2002, pp. 53–60.

  15. Louise I. Shelley and John T. Picarelli, “Methods Not Motives: Implications of the Convergence of International Organized Crime and Terrorism,” Police Practice and Research, Vol. 3, No. 4, 2002, p. 308.

  16. Byman et al., Outside Support, p. 41. Latin America is accepted as an outlier since diaspora support largely tends to be directed at ethnic insurgencies, which are rare in Latin America.

  17. Ibid., p. 57.

  18. Gabriel Sheffer, “Diasporas and Terrorism,” in Louise Richardson, ed., The Roots of Terrorism, London: Routledge, 2006, pp. 118–119.

  19. Terrence Lyons and Peter Mandaville, eds., Politics from Afar: Transnational Diasporas and Networks, New York: Columbia University Press, 2012, p. 19.

  20. Steve Kiser, Financing Terror: An Analysis and Simulation for Affecting Al Qaeda’s Financial Infrastructure, RAND Pardee School dissertation, Santa Monica, Calif.: RAND Corporation, 2005, p. 70.

  21. Evan F. Kohlmann, “The Role of Islamic Charities in International Terrorist Recruitment and Financing,” Danish Institute for International Studies, DIIS Working Paper, 2006.

  22. Daveed Gartenstein-Ross and Aaron Y. Zelin, “Uncharitable Organizations,” Foreign Policy, February 26, 2013.

  23. “Risk of Terrorist Abuse in Non-Profit Organizations,” Report of the Financial Action Task Force (FATF), June 2014.

  24. Kevin Stringer, “Counter Threat Finance (CTF): Grasping the Eel,” Military Power Revue, No. 2, 2013.

  25. Jay S. Albanese, Transnational Crime and the 21st Century: Criminal Enterprise, Corruption, and Opportunity, Oxford: Oxford University Press, 2011, p. 66.

  26. Ibid., p. 73.

  27. Shelley and Picarelli, “Methods Not Motives,” p. 311.

  28. Phil Williams, “Insurgencies and Organized Crime,” in Phil Williams and Vanda Felbab-Brown, eds., Drug Trafficking, Violence, and Instability, Carlisle Barracks, PA: U.S. Army War College Strategic Studies Institute, April 2012, p. 61.

  29. Malcolm Beith, “HSBC Report Shows Difficulty of Stopping Money Launderers,” The Daily Beast, July 19, 2012.

  30. Michael Levi and Peter Reuter, “Money Laundering,” in Michael Tonry, ed., The Oxford Handbook of Crime and Public Policy, Oxford University Press, 2011, p. 290.

  31. “Global Surveillance of Dirty Money: Assessing Assessment of Regimes to Control Money Laundering and Combat the Financing of Terrorism,” Center on Law & Globalization, January 30, 2014, p. 9.

  32. U.S. Comptroller General, Money Laundering: Extent of Money Laundering through Credit Cards Is Unknown, Washington DC: U.S. Government Accountability Office (GAO), 2002.

  33. Svante Cornell, “Narcotics and Armed Conflict: Interaction and Implications,” Studies in Conflict & Terrorism, Vol. 30, No. 3, 2007, p. 208.

  34. Thomas Mockaitis, “Resolving Insurgencies,” Strategic Studies Institute (SSI) U.S. Army War College, June 2011, pp. 37–48.

  35. Tamara Makarenko, “The Crime-Terror Continuum: Tracing the Interplay between Transnational Organized Crime and Terrorism,” Global Crime, Vol. 6, No. 1, 2004, pp. 129–145.

  36. Chris Dishman, “Terrorism, Crime, and Transformation,” Studies in Conflict & Terrorism, Vol. 24, No. 1, 2001, p. 52.

  37. McKenzie O’Brien, “Fluctuations Between Crime and Terror: The Case of Abu Sayyaf’s Kidnapping Activities,” Terrorism and Political Violence, Vol. 24, No. 2, 2012, p. 320.

  38. Thomas M. Sanderson, “Transnational Terror and Organized Crime: Blurring the Lines,” SAIS Review, Vol. 24, No. 1, Winter-Spring 2004, p. 52.

  39. Williams, “Insurgencies and Organized Crime,” in Williams and Felbab-Brown, Drug Trafficking, Violence, and Instability, p. 41.

  40. Phil Williams and Colin P. Clarke, “Terrorist Financing and Organized Crime” in Amit Kumar and Dennis Lormel, eds., Understanding and Combating Terrorist Financing, London: Taylor and Francis, forthcoming.

  41. Jam Hajjad Hussain, “Son-in-Law of Gen Tariq Wins
Freedom for Rs 300 m,” The Nation, March 16, 2012.

  42. Catherine Collins with Ashraf Ali, “Financing the Taliban: Tracing the Dollars Behind the Insurgencies in Afghanistan and Pakistan,” New America Foundation Counterterrorism Strategy Initiative Policy Paper, April 2010, p. 7.

  43. Ibid.

  44. Sami Yousafzai, “For the Taliban, A Crime that Pays,” The Daily Beast, September 5, 2008.

  45. Arabinda Acharya et al., “Making Money in the Mayhem: Funding Taliban Insurrection in the Tribal Areas of Pakistan,” Studies in Conflict & Terrorism, Vol. 32, No. 2, 2009, pp. 95–108.

  46. Vanda Felbab-Brown, “Fighting the Nexus of Organized Crime and Violent Conflict While Enhancing Human Security,” in Williams and Felbab-Brown, eds., Drug Trafficking, Violence, and Instability, p. 1.

  47. John Rollins and Liana Sun-Wyler, “Terrorism and Transnational Crime: Foreign Policy Issues for Congress,” Congressional Research Service (CRS), October 19, 2012, p. 11.

  48. Williams, “Insurgencies and Organized Crime,” in Williams and Felbab-Brown, eds., Drug Trafficking, Violence, and Instability, p. 54.

  49. James J. F. Forest, “Kidnapping by Terrorist Groups, 1970–2010: Is Ideological Orientation Relevant?” Crime & Delinquency, Vol. 58, No. 5, 2012, pp. 769–797.

  50. Mark Galeotti, “Spirited Away—The Rise of Global Kidnapping Trends,” Jane’s Intelligence Review, April 27, 2010.

  51. Phil Williams, “Terrorist Financing and Organized Crime: Nexus, Appropriation, or Transformation?” In Thomas J. Biersteker and Sue E. Eckert, eds., Countering the Financing of Terrorism, New York: Routledge, 2008, pp. 130–131.

  52. Albanese, Transnational Crime, pp. 27–28.

  53. John M. Martin and Anne T. Romano, Multinational Crime: Terrorism, Espionage, Drug & Arms Trafficking, Los Angeles: Sage, 1992, pp. 67–68.

  54. Kim Cragin and Bruce Hoffman, Arms Trafficking and Colombia, Santa Monica, Calif.: RAND Corp., 2003, pp. 10–11.

  55. Alissa J. Rubin, “U.S. Patrols Smuggling Routes to Macedonia: Balkans: American Peacekeepers in Kosovo Intercept Weapons on Way to Rebels,” Los Angeles Times, August 20, 2001.

  56. Esther Bacon, “Balkan Trafficking in Historical Perspective,” in Kimberley L. Thachuk, Transnational Threats: Smuggling and Trafficking in Arms, Drugs, and Human Life, Westport, CT: Praeger Security International, 2007, p. 80.

  57. Peter Andreas, Blue Helmets and Black Markets: The Business of Survival in the Siege of Sarajevo, Ithaca: Cornell University Press, 2008, pp. 54–55.

  58. For more on the network aspect of drug trafficking, see Phil Williams, “The Nature of Drug-Trafficking Networks,” Current History, April 1998, pp. 154–159.

  59. Rollins and Sun Wyler, “Terrorism and Transnational Crime” p. 10; see also, Vanda Felbab-Brown, Shooting Up: Counterinsurgency and the War on Drugs, Washington DC: Brookings Institution Press, 2010.

  60. Chris Dishman, “The Leaderless Nexus: When Crime and Terror Converge,” Studies in Conflict & Terrorism, Vol. 28, No. 3, 2005, p. 246.

  61. Williams, “Insurgencies and Organized Crime,” in Williams and Felbab-Brown, Drug Trafficking, Violence, and Instability, p. 32.

  62. Ibid, p. 33.

  63. Dishman, “Terrorism, Crime, and Transformation,” p. 43.

  64. Sanderson, “Blurring the Lines,” p. 52; see also Williams, “Insurgencies and Organized Crime,” in Williams and Felbab-Brown, eds., Drug Trafficking, Violence, and Instability, p. 44.

  65. Sanderson, “Blurring the Lines,” p. 51.

  66. Nick McKenzie and Richard Baker, “Terrorists Taking Cut of Millions in Drug Money,” The Canberra Times, January 23, 2014.

  67. Felbab-Brown, “Fighting the Nexus,” in Williams and Felbab-Brown, eds., Drug Trafficking, Violence, and Instability, p. 5.

  68. Shelley and Picarelli, “Methods Not Motives,” p. 313.

  69. Sanderson, “Blurring the Lines,” p. 53.

  70. Jay Albanese and Philip Reichel, eds., Transnational Organized Crime: An Overview from Six Continents, Los Angeles: Sage, 2014, p. 77; see also, Maggy Lee, Trafficking and Global Crime Control, Los Angeles: Sage, 2011.

  71. Katja Franko Aas, Globalization & Crime, Los Angeles: Sage, 2013, p. 38.

  72. Ibrahim Abdullah and Patrick Muana, “The Revolutionary United Front of Sierra Leone: A Revolt of the Lumpenproletariat,” in Christopher Clapham, ed., African Guerillas, Oxford: James Currey, 1998, p. 179.

  73. Jeffrey Gettleman and Nicholas Kulish, “Somali Militants Mixing Business and Terror,” New York Times, September 30, 2013.

  74. Albanese, Transnational Crime, p. 93.

  75. Seth G. Jones and Patrick B. Johnston, “The Future of Insurgency,” Studies in Conflict & Terrorism, Vol. 36, No. 1, 2013, p. 8.

  76. Brian J. Philippes, “Terrorist Group Cooperation and Longevity,” International Studies Quarterly, Vol. 58, No. 2, 2014, p. 338.

  77. Daniel Byman, “Talking with Insurgents: A Guide for the Perplexed,” Washington Quarterly, Vol. 32, No. 2, 2009, p. 126.

  78. Kim Cragin et al., The Dynamic Terrorist Threat: An Assessment of Group Motivations and Capabilities in a Changing World, Santa Monica, Calif.: RAND Corporation, 2004, p. 25.

  79. Ibid.

  80. Richard H. Shultz and Andrea J. Dew, Terrorists, Insurgents, and Militias: The Warriors of Contemporary Combat, New York: Columbia University Press, 2007, p. 124.

  81. Byman et al., Trends in Outside Support, p. 93.

  82. Ibid., p. 117.

  83. Ibid., p. 91.

  84. Cragin et al., Dynamic Threat, pp. 50–51.

  85. Ibid., p. 53.

  86. William Rosenau, “Understanding Insurgent Intelligence Operations,” Marine Corps University Journal, Vol. 2, No. 1, Spring 2011, pp. 15–18.

  87. Ibid., p. 47.

  88. Christopher Tuck, “Northern Ireland and the British Approach to Counter-Insurgency,” Defense & Security Analysis, Vol. 23, No. 2, 2007, pp. 165–183.

  89. Bard E. O’Neill, Insurgency and Terrorism: Inside Modern Revolutionary Warfare, Washington DC: Brassey’s Inc., 1990, p. 117.

  90. Angel Rabasa et al., Beyond Al-Qaeda: The Global Jihadist Movement, Part I, Santa Monica, Calif.: RAND Corp., 2006, p. 62.

  91. Ben Connable and Martin Libicki, How Insurgencies End, Santa Monica, Calif.: RAND Corp., 2010, pp. 34–49.

  92. Paul Staniland, “Defeating Transnational Insurgencies: The Best Offense Is a Good Fence,” Washington Quarterly, Vol. 29, No. 1, pp. 22–23.

  93. Anne L. Clunan and Harold A. Trinkunas eds., Ungoverned Spaces: Alternatives to State Authority in Era of Softened Sovereignty, Stanford: Stanford University Press, 2010.

  94. Rabasa et al., Ungoverned Territories, pp. 15–19.

  95. Dennis Gormley, “Silent Retreat: The Future of U.S. Nuclear Weapons,” Nonproliferation Review, Vol. 14, No. 2, July 2007, p. 201.

  96. Ibid.

  97. Michael Kenney, “Organizational Learning and Islamist Militancy,” National Institute of Justice, NIJ Journal No. 265, 2010.

  98. Daniel Byman and Kenneth M. Pollack, “Let Us Now Praise Great Men: Bringing the Statesman Back In,” International Security, Vol. 25, No. 4, pp. 107–146.

  99. Cragin et al., Dynamic Threat, p. 25.

  100. Headquarters, U.S. Department of the Army, and Headquarters, U.S. Marine Corps, Counterinsurgency Field Manual, Field Manual 3-24/Marine Corps Warfighting Publication 3–33.5, Chicago, Ill.: University of Chicago Press, 2007, pp. 20–25.

  101. Cragin et al., Dynamic Threat, p. 40.

  102. G. H. McCormick and G. Gown, “Security and Coordination in Clandestine Organization,” Mathematical and Computer Modeling, No. 31, 2000, pp. 175–192; J. Bowyer Bell, “Revolutionary Dynamics: The Inherent Inefficiency of the Underground,” Terrorism and Political Violence, Vol. 2, No. 4, 1990, pp. 193–211.

  103. For more on the effectiveness of decapitation of leadership in counterinsurgency, see Patrick B. Johnston, “Does Decapitation Work? Assessing the Effectiveness of Lea
dership Targeting in Counterinsurgency Campaigns,” International Security, Vol. 36, No. 4, 2012, pp. 47–79.

  104. Field Manual 3–24, 2007.

  105. Eric Hobsbawm, Primitive Rebels, Manchester, England: Manchester University Press, 1959.

  106. Raj Desai and Harry Eckstein, “The Transformation of Peasant Rebellion,” World Politics, Vol. 42, No. 4, July 1990, p. 454.

  107. Thomas Marks, “Ideology of Insurgency: New Ethnic Focus or Old Cold War Distortions?” Small Wars & Insurgencies, Vol. 15, No. 1, Spring 2004, p. 110.

  108. See Marks, “Ideology of Insurgency”; Nicholas I. Haussler, Third Generation Gangs Revisited: The Iraq Insurgency, Monterey, Calif.: Naval Postgraduate School, Thesis, September 2005; see also, Martin C. Libicki et al., Byting Back: Regaining Information Superiority Against 21st Century Insurgents, Santa Monica, Calif.: RAND Corporation, 2007. The phrase “disproportionate” use of force is a widely contested term and is often the cause of serious debate, especially in regards to Israeli responses to Palestinian or Lebanese violence.

  109. Nichole Argo, “The Role of Social Context in Terrorist Attacks,” The Chronicle of Higher Education, January 13, 2006.

  110. On the intensity of the resistance, see Metz and Millen, Insurgency and Counterinsurgency in the 21st Century and Louise Richardson What Terrorists Want, New York: Random House, 2006. On the increase in the likelihood of suicide attacks, see Robert Pape, Dying to Win: The Strategic Logic of Suicide Terrorism, New York: Random House, 2006; For a theoretical and empirical treatment of military occupations, see David M. Edelstein, “Occupational Hazards: Why Military Occupations Succeed or Fail,” International Security, Vol. 29, No. 1, pp. 49–91.

  111. Christopher Paul, “How Do Terrorists Generate and Maintain Support?” in Paul K. Davis and Kim Cragin, eds., Social Science for Counterterrorism: Putting the Pieces Together, Santa Monica, Calif.: RAND Corporation, 2009, pp. 113–150.