
How Are Pak Terrorists Moving Money? Hints From An FATF Report
FATF Has To Do Its Job
For those not in the know, the FATF is an intergovernmental body formed in 1987 by the G-7 countries, the European Commission and eight others (who are curiously not listed), to combat money-laundering, including "terrorist financing and the financing of proliferation of weapons of mass destruction".
This has nothing to do with morality, but with the fact that terrorist financing can include all manner of crimes, including human and narcotics trafficking, among other things; it can essentially infect the international banking system to the detriment of each state.
The FATF does periodic reviews of each country. India joined in 2010, and in 2024, it got an 'outstanding' report for its financial stability and probity. The body, however, warned it against the use of 'non-profit' associations for terrorist financing. A number of NGOs were shut down, causing a hue and cry of 'illiberalism'.
Pakistan, on the other hand, has been put on the 'grey list' several times, which means its financial systems have significant deficiencies. It was on the list in 2008, then in 2012, and then again in 2018 till 2022, during which period Islamabad sentenced Lashkar-e-Taiba (LeT) leader Zaki ur Rehman Lakhvi for five years Hafiz Saeed to 33 years in prison. The country also set in place the Anti-Terrorism Act (Amendment) Bill, 2020, which brought Pakistan's legal definition of terrorism up to international standards and aligned its laws with global norms on terrorist financing.
However, Pakistan's clean-up is far from done. It has just gone deeper underground.
Digital Routes
This is, however, not just about Pakistan and its backing of jihadist groups. Sure, in a move that would have Rawalpindi in panic, the report names and shames the LeT and the Jaish-e-Mohammad (JeM), as well as their so-called charitable arms. But it digs deep into the world of terrorist finance and warns that these actors have developed a 'persistent ability' to exploit the financial system of a majority of countries reviewed. The extent of the sophistication is apparent in the use of digital platforms like social media messaging apps and crowdfunding sites. Then there are shell companies, legal companies, and even trusts.
But here's the clincher. Terrorist financing is most effective when they control territory or are proximate to terrorist areas. That means taxes, diversion of humanitarian aid and access to natural resources.
The Thing About State Sponsorship
The key point in the document is that it flags, for the first time, state-sponsored terrorism, though it admits it has not yet developed a typology for this. It refers to reports of states helping designated terrorist groups to circumvent sanctions regimes, and interestingly notes, "When an organisation is not designated at the multilateral level, it is more likely to engage in financial activities, including fundraising".
That's one in the jaw for those analysts who wonder why we bother to get designations at the United Nations, a body largely seen as toothless. Sanctions are powerful instruments, if imposed strongly. True, Pakistan is not explicitly named, but the very recognition of this issue is vital for Indian investigators and diplomats. The report notes significantly that donations are coordinated through encrypted mobile communications, money services businesses, cash, or in virtual assets. In short, they "demonstrated remarkable adaptability" to beat the system. In addition, there is "an enhanced focus on technology and communications, with increased investment in secure communications devices, software, and cybersecurity measures". Now think about that in terms of Pahalgam, where the communications gear - the so-called 'ultra-sets' - operated only on radio waves. No wonder a trail was difficult to find.
Moving The Money
There's another frightening observation. Networked organisations such as the Islamic State and al Qaeda rely on regional entities for moving funds. That includes the AQIS (al Qaeda in the Indian subcontinent), which, just after India's Operation Sindoor, called upon all Muslims in India to launch a jihad. That's strange in itself, since the group was last heard of operating out of Assam in 2022 in conjunction with Bangladeshi groups. That's networking across three international borders.
Then there are the Islamic State's 'offices' such as the Maktab al Siddiq, which move funds through India and Bangladesh, among others, in hawala transactions. No, hawaladars are no longer handling greasy notes. Many, including in Afghanistan, are using cryptocurrency. The hawala trail itself has been replicated into a blockchain-based pseudo-anonymous transfer system, where a new user has to be vetted before they fit into the system, making it virtually impossible for an investigator to penetrate it. It's like a vast spider's web.
Techno Parks for Terror
Apart from all of the above, some unusual features have been identified. Terrorists now also bank on monetisation of social media platforms like Zoom or YouTube. There's also 'X', which provides services for its 'blue tick', and which, in turn, allows users to 'tip' other accounts using various payment methods. Research has found blue-ticked accounts tied to sanctioned entities and individuals.
Then there's YouTube's 'Super chat' feature, which allows viewers to purchase highlighted messages in live streams. Easy to support your favourite jihadi even while increasing their visibility. There are prepaid cards, pre-loaded, allowing easy transfer, and 'open loop' cards, which means money can be drawn across the world. It's enough to make an investigator cry into his coffee.
Following The Trail
However, investigators in Pakistan are particularly astute. One example cited in the FATF report is the evidence from a car bomb attack that was claimed by the Tehrik-e-Taliban Pakistan (TTP). The investigation involved tracing the owner of the car. which led to the authorities finding out that the person reactivated a dormant bank account, conducted some three transactions for large amounts, and then closed it entirely. Pakistan's Financial Monitoring Unit identified foreign remittances as well, and eventually arrested the lot. The point is, Pakistan can do a good job when it wants to.
But in the Pulwama attack of 2019, it didn't despite being given a chance. The report notes flatly how the investigations back then "revealed the cross-border movement of a large quantity of explosives into India". Notably, a key component of the improvised explosive device used in the attack - aluminium powder - was procured through Amazon. So, e-commerce sites are another area that could be misused. That's damning enough, though the FATF also notes how the authorities concluded' that the attack was by the JeM.
Today's Terrorism Is Complicated
Everything considered, this is a report that portrays the extent of the challenge security agencies face in preventing terrorism in the first place, and, in the second, grappling with the ensuing 'whodunnit'. It's virtually impossible to trace everything, and terrorist sponsors know it.
The immediate danger for New Delhi is the fact outlined clearly by the FATF: that the individual terrorist, inspired by a deluge of online propaganda, needs very little money to go ahead and hit its target. The Gokarnath temple attacker was arrested after some 44 international third-party transactions were found through forensic analysis of his phone. Today's terrorists have gone far beyond that.
Ultimately, the burden of finding proof has become an even bigger task, as also convincing some world leaders who often offer to 'mediate'. In the end, there is only one solution: the terrorist sponsor has to be shut down in its entirety. Forget the web, just smash the spider.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


Indian Express
30 minutes ago
- Indian Express
‘MVA failure to oppose Urban Naxal Bill in Assembly sent wrong message, it must hit streets now': CPI(M)'s Dhawale
The smooth passage of the Maharashtra Special Public Security (MSPS) Bill in the state Assembly recently saw the members of the Opposition Maha Vikas Aghadi (MVA), which includes the Congress, NCP(SP) and Shiv Sena (UBT), failing to even express their dissent against the legislation dubbed as 'Urban Naxal Bill', which seeks 'effective prevention of certain unlawful activities of Left-wing extremist organisations'. The only dissenter from the Opposition ranks on the floor of the House was CPI(M) MLA Vinod Nikole. The Bill's critics have warned that it grants sweeping powers to the State that could criminalise dissent and ideological activity under the pretext of curbing Naxalism, raising fears of arbitrary arrests. In an interview with The Indian Express, CPI(M) Politburo member and All India Kisan Sabha (AIKS) chief Ashok Dhawale says the MSPS Bill marks a 'direct assault on democratic rights and civil liberties', calling the MVA MLAs' silence in the House 'unfortunate'. Excerpts: The CPI(M) has come out strongly against the MSPS Bill. Could you explain the reasons behind your opposition? We are completely opposed to this Bill. At its core, it is a direct attack on democratic rights and civil liberties. The government is using the so-called 'urban Naxal' threat as a red herring, an excuse to target dissent and silence critics of the ruling BJP and their corporate backers. Maharashtra Chief Minister Devendra Fadnavis has publicly stated that the Naxal issue in Maharashtra is confined to just two tehsils in Gadchiroli. Union Home Minister Amit Shah also has publicly stated that the Naxalite Maoist problem has largely been eliminated nationwide. So, the question arises if the threat is under control, why this new law now? The government claims it is a security measure. Are you saying there is more to it? This law is not about security, it is about silencing voices. There are already enough draconian laws in place — UAPA at the national level, and MCOCA in Maharashtra. Some provisions in this new Bill are even more draconian than UAPA. So clearly, it's not about lack of legal tools. We believe this is being brought in to suppress growing people's movements in the state like the farmers fighting against land acquisition for the Shaktipeeth Highway, or resistance to corporate-led projects in Dharavi, Wadhwan port, and areas like Gadchiroli and Chandrapur. These projects, pushed by big corporates, especially mining projects in districts like Gadchiroli and Chandrapur for which land acquisition process has started, often violate forest and land rights. The Bill is a tool to criminalise these legitimate struggles. While you have criticised the Mahayuti government, several of your own allies in the MVA have been criticised for not opposing the Bill. What is your take? The record of the MVA who are our allies has been mixed. I would describe what happened in the Assembly as unfortunate. However, to be fair, several top MVA leaders joined earlier protests against this Bill. On June 3, there was a massive dharna at Azad Maidan, and leaders like Supriya Sule, Jayant Patil, and Uddhav Thackeray were present where they were categorical about their opposition to the Bill. On April 22, nearly 50,000 people protested against this Bill across Maharashtra. Though that was a Left-led call, many MVA leaders joined in solidarity. However, we were disappointed that when the Bill was introduced in the Assembly, only our MLA Vinod Nikole of the CPI(M) stood up to oppose it. Not a single MLA from the MVA bloc spoke out. On the same day we had an online meeting with NCP (SP) leader Jayant Patil and we raised this issue with him. We were told that several MVA MLAs who were part of the Select Committee had already opposed the Bill in that House Committee. But we believe that not opposing it on the Assembly floor sent the wrong message. It has not gone down well with the people of the state. To their credit, the very next day in the Legislative Council, the MVA rectified this mistake, where they unitedly opposed the Bill and walked out in protest. That act did some damage control, and we welcomed it. What are your expectations from the MVA now? And, are you planning to take any legal recourse against the Bill? Of course, we will examine legal options, but we are realistic. Generally, courts do not interfere in legislative processes. So we are not placing much emphasis on legal challenges. The real battle is on the streets. The farm laws passed by Parliament were ultimately repealed through mass struggle. Similarly, if we want to defeat this draconian Bill, we need a broad-based, united mass movement. We are trying to bring all forces together to make that happen. Speeches alone will not see the end of this Bill. We, including the major constituents of the MVA, will need to hit the streets. We are trying to persuade them. Let us see what happens. Would you like some provisions of the Bill to be diluted, or you want the bill to be repealed? The government had called for suggestions and objections to this Bill and it received 12,500 suggestions. Out of these, 9000 suggestions sought a complete scrapping of the Bill while another 3,000 called for amendments. We believe that the Bill in its entirety is harmful for the citizens of the state. We are not protesting so that the government tweak this law — we want it to be thrown out entirely.


New Indian Express
39 minutes ago
- New Indian Express
Prof Jagneshwar Dandapat reappointed interim VC of Utkal University under amended Ordinance
BHUBANESWAR: Prof Jagneshwar Dandapat has been reappointed as the in-charge vice-chancellor (VC) of Utkal University. The Chancellor's office on Friday issued a notification in this regard. He will continue till joining of the new vice-chancellor or until further orders. Dandapat was appointed as the in-charge V-C on May 27 this year after Sabita Acharya's extended tenure ended on May 23. However, this was challenged by a lawyer Prabir Kumar Das who filed a PIL in Orissa High Court, alleging that the appointment violated Section 6 (10) of the Odisha Universities Amendment Act, 2024. The Orissa High Court on Wednesday disposed of the PIL following the state government's decision to cancel the appointment. The re-appointment is according to the Odisha Universities (Amendment) Ordinance, 2025. Section 6 (10) of the Ordinance has been amended to empower the Chancellor to appoint any person as V-C for the time being until a regular appointment is made. This also empowers the Chancellor to fix the tenure of the V-C.


Hindustan Times
3 hours ago
- Hindustan Times
Karnataka lowers SSLC pass marks to 33% starting academic year 2025-26
The Karnataka government has released a draft notification proposing a reduction in the pass percentage for the SSLC (Secondary School Leaving Certificate) examination from 35% to 33%, effective from the academic year 2025-26. The draft, titled Karnataka Secondary Education Examination Board First Regulations (Amendment) 2025, was issued on Thursday.(PTI/File photo) According to news agency PTI, the draft, titled Karnataka Secondary Education Examination Board First Regulations (Amendment) 2025, was issued on Thursday. As per the revised guidelines, students will now be required to secure a minimum average of 33% marks, calculated by combining scores from both internal assessments and external examinations, in order to be declared as having passed. (Also Read: Chinnaswamy stadium deemed 'unsafe' for mass gatherings after Bengaluru stampede: Report) The change has been introduced through an amendment to the Karnataka School Examination and Assessment Board Act, 1966, the report added. The official notification from the Department of School Education & Literacy specifies: 'Candidates shall secure an average of 33 per cent marks in internal assessment and external examination combined and shall be declared pass if they secure at least 206 marks out of a total of 625 marks, including at least 30 per cent marks in each subject out of the total marks of the respective subject.' The government has opened a 15-day window for the public to submit objections or suggestions regarding the proposed changes. KRIES schools shine At 91 per cent, the SSLC pass rate of Karnataka Residential Education Institutions Society (KREIS) schools for the academic year 2024–25 has far surpassed the state average of 62.34 per cent, Karnataka Social Welfare Minister H C Mahadevappa recently said. "We have embraced education as a noble instrument in our pursuit of social justice," Mahadevappa told PTI. KREIS is a network of residential educational institutions run by the Karnataka government, providing free residential education to socially and economically disadvantaged children. (With agency inputs) (Also Read: Dharmasthala mass burials: SIT begins operations from Belthangady)