Europol has cautioned that the use of digital currencies, cryptocurrencies, and virtual asset service providers has allowed terrorist organisations to "increasingly exploit crowdfunding operations" while retaining anonymity.
In its most recent EU Terrorism Situation and Trend Report, the agency stated that the increased availability of crowdfunding websites, which provides the opportunity to reach a large number of donors and quickly raise substantial sums of money, "makes this forum attractive to terrorist and extremist organisations."
“The use of digital currency, cryptocurrency and virtual asset service providers (VASPs) enables terrorist and extremist groups to increasingly misuse crowdfunding activities, while maintaining a higher level of anonymity for donors and recipients,” said Europol.
Instances of terrorist groups exploiting non-profit organisations to gather funds under the pretext of philanthropic drives were also uncovered.
This includes a case in Spain in which three defendants were detained for funding terrorism after money obtained under the guise of humanitarian help for Syrian orphans was redirected to finance al-Qaeda terrorists in Syria.
Despite these new ways, Europol stated that the old banking system "remains one of the top options for sending money overseas," as terrorist organisations continue to use national and transnational banks to move funds to accounts outside the EU.
The organisation also disclosed that FinTech firms have been "increasingly scrutinised by EU authorities" in cases of terrorist funding, with Spain reporting a shift from money business services to crypto-assets beginning in 2020.
In 2021, EU Member States reported 14 arrests due to terrorist funding and 388 arrests for terrorism-related offences.
Individual contributions continue to be one of the leading sources of funding for terrorist and violent extremist organisations across the entire ideological spectrum, according to Europol.
By fLEXI tEAM