Financial Crime World

The Dark Side of Social Media: Terrorism Financing on Crowdfunding Platforms

The Role of Social Media in Terrorism Financing

Social media platforms can play a significant role in terrorism financing (TF) by:

  • Reinforcing Extremist Beliefs: Spreading ideologies that promote violence and extremism, leading users to specific fundraising causes they may not have been exposed to otherwise.
  • Fundraising for Terrorist Organizations: Raising funds for terrorist organizations through crowdfunding campaigns or online donations.

The Challenges of Crowdfunding in TF

The report highlights the following points related to crowdfunding:

Interaction of Crowdfunding with Virtual Assets (VA)

  • Unique Investigative Challenges: The use of virtual assets like Bitcoin and other types of VAs in crowdfunding poses unique challenges for investigators due to their anonymous nature.
  • Concealing Fund Origins and Destinations: Services like tumblers and mixers can be used by threat actors to further conceal the origin and destination of funds linked to TF.

Regulatory Challenges

  • Inconsistent AML/CFT Regulation: Anti-money laundering and counter-terrorist financing (AML/CFT) regulation is not consistent across the globe, and donations-based crowdfunding often falls outside of these regulations.
  • Difficulty in Detecting and Deterrent Action: Law enforcement agencies face challenges in proving that funds were used for terrorism-related offenses due to the complexity of crowdfunding operations and lack of data.

Need for Public-Private Information Sharing

  • Continuous Outreach and Awareness-Raising: Countries should engage in continuous outreach and awareness-raising to private sector stakeholders to improve detection of potential TF activity.

Recommendations for Mitigating TF Risks

Jurisdictions and all stakeholders involved in the crowdfunding industry are recommended to:

  • Identify and Understand TF Risks: Identify and understand the terrorism financing risks associated with this activity.
  • Implement Proportionate Risk-Based Measures: Have proportionate risk-based measures in place to mitigate potential abuses.