How the islamic state makes its money – the washington post gas vs electric heat


Weapons, vehicles, employee salaries, propaganda videos, international travel — all of these things cost money. The recent terrorism attacks in Paris, which the Islamic State has claimed as its own work, suggest the terrorist organization hasn’t been hurting for funding. David Cohen, the Treasury Department’s Undersecretary for Terrorism and Financial Intelligence, described the Islamic State last October as probably the best-funded terrorist organization we have confronted — deep pockets that have allowed the group to carry out deadly campaigns in Iraq, Syria and other countries.

But where does the Islamic State get all this money? It turns out that the group’s methods of financing are very different from other prominent terrorist organizations, and much more difficult for the United States and other countries to shut down. Unlike many terrorist groups, which finance themselves mainly through wealthy donors, the Islamic State has used its control over a territory that is roughly the size of the U.K. and home to millions of people electricity cost per watt to develop diversified revenue channels that make it more resilient to U.S. offensives.

Normally, U.S. efforts to cut off funding for terrorists focus on tracking and stopping the flow of funds through the international system. Since 9/11, the United States, other countries, and international organizations such as the International Monetary Fund and the United Nations have set up initiatives to detect and stop the flow of funds to terrorists. Leaders of the Group of 20 issued a statement on Sunday calling for better coordination to cut off funding channels to terrorist organizations, including exchanging information and freezing terrorist assets.

While the Treasury Department says these efforts have disrupted terrorist networks and saved lives, the Islamic State is a different animal. The Islamic State often avoids international finance, instead generating and spending funds within its own territory or immediately along its porous borders. As for disrupting the revenue that ISIL generates from extortion and other local criminal activities, we recognize that Treasury’s tools are not particularly well-suited to the task j gastroenterol hepatol, Cohen said in October, using another name for the Islamic State.

Estimates of the precise amount that the Islamic State earns from these activities tend to vary a lot and fluctuate over time, but what is certain is that the group is heavily diversified — meaning that if one funding source is shut down, the group can turn to others to generate revenue. Its main methods of generating money appear to be the sale of oil and antiquities, as well as taxation and extortion. And the group’s financial resources have grown quickly as it has captured more territory and resources: According to estimates by the Rand Corporation, the Islamic State’s total revenue rose from a little less than $1 million per month in late 2008 and early 2009 to perhaps $1 million to $3 million per day in 2014.

The Islamic State has other expenses, besides the cost of carrying out terrorist attacks and waging war. The terrorist group runs schools, a religious police force, food kitchens, an Islamic court system and even a Consumer Protection authority. It reportedly pays fighters roughly $400 a month, which is more than the Iraqi government offers some staff. The Islamic State sets and approves annual budgets, and it uses a chief financial officer-like figure to manage its accounts. It’s also fastidious about documenting a return on investment for its funders. The Islamic State has established a central bank and even planned to mint its own currency — although in practice the group generally uses local currency, such as the Iraqi dinar and the Turkish lira.

Its control of an expansive territory obviously gives the Islamic State a valuable source of funding and flexibility. However, some U.S. officials have argued that having territory might also be seen as a weakness for electricity resistance questions the group. Maintaining a state of 8 million to 10 million people, waging war around its borders, and financing and carrying out international attacks are costly and difficult tasks. Without adequate funds to provide services to the local population, people in Islamic State territory might turn against the group, provoking a backlash that might end its grip on power, the thinking goes. In addition, reports from territory held by the group paint a picture of a brutal, two-tiered society, in which terrorists and their families live well and most others suffer. Under this pressure, the economy struggles to function, leaving the Islamic State with less and less to tax and to sell.

Oil: The oil fields that it has captured in Syria and Iraq have been a major source of funding for the gas bloating pregnancy terrorist group. Although it’s relatively easy for the United States and other countries to prevent large-scale exports of oil from Islamic State territory, it’s much harder to control the black market oil trade that reportedly flourishes along the porous borders of territory controlled by the Islamic State and surrounding countries.

The terrorist group mostly refines oil in small, mobile refineries, then ships it by truck to the Turkish border, where oil brokers and traders buy or barter for it. Because the trade is illegal, the oil is sold at a steep discount that can fluctuate wildly. Smugglers reportedly use mobile messaging services like Whatsapp to coordinate exchanges of products. Some traders may even have been selling oil from the Islamic State back to the regime of Bashar al-Assad, which the Islamic State is fighting in Syria, according to the Boston Globe.

Oil sales initially provided much of the Islamic State’s revenue, but that has declined since the U.S. and others launched an extensive campaign of airstrikes on the group’s oil and gas facilities, according to a report by the Congressional Research Service in April. By October 2014, the U.S. had reportedly destroyed about half of the group’s refining capacity. The United States has also tried to identify and target oil brokers and encourage Turkey to clamp down on smuggling on its border.

The Islamic State’s oil and gas revenue has also suffered because the engineers and other technical experts necessary to make these products have either fled the area or been killed. The terrorist group has been trying hard to recruit skilled people, as a recording by Islamic State leader Abu Bakr al Baghdadi calling for scientists, engineers, doctors and people with administrative expertise in July 2014 shows.

The Islamic State levies taxes on things including goods sold, utilities such as electricity and water (when they run, that is — in some areas, the electricity is only on for an hour a day), telecommunication companies, cash withdrawals from bank accounts, employee salaries, trucks entering Islamic electricity generation in india State-controlled territory at checkpoints, looting archaeological sites and non-Muslim communities in general. A report by Thomson Reuters estimates that this system of extortion and taxation could generate as much as $360 million per year for the terrorist organization.

Some estimates say that the Islamic State received up to $40 million in 2013-2014 from businessmen, wealthy families and other donors in Saudi Arabia, Qatar, Kuwait and the United Arab Emirates. Many of these elite donors chose to fund the Islamic State because of fear and animosity for Iran and Syrian President Bashar al-Assad. A report by the Brookings Institution in 2013 observed that donors in Kuwait were channeling hundreds of millions of dollars to various Syrian rebel groups t gastrobar.

After then-Secretary of State Hillary Clinton and others in the international community criticized these countries for financing terrorists, Saudi Arabia criminalized financial support in 2013 for the Islamic State, al-Qaeda and other terrorist organizations. The United Arab Emirates also appears to have made headway in limiting terrorist financing, according to Brookings. But other funding channels, including through unregistered charitable organizations that funnel money to the Islamic State, are still open.

Sales of antiquities: As the Islamic State has gained territory, it has taken control of museums, private collections and archaeological sites, such as the 9th century B.C. grand palace of Assyrian king Ashurnasirpal II. This has given the terrorist group an expansive supply of precious art and historical artifacts. Earlier this year, the group had at least 4,500 cultural sites under its control, according to the Paris-based Financial Action Task Force.

In November 2014, Matthew Levitt of the Washington Institute for Near East Policy told a House committee that the sale of antiquities — both those stolen from collections and those that were newly excavated — was the group’s second-large source of revenue after illicit oil sales. Other U.S. estimates put the total volume of trade in antiquities at more than $100 million a year.