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Extremism and terrorism motivated by far-right ideologies has captured the attention of policymakers and much of the public as an urgent threat to peace, security and democracy across much of the Western world. Through an analysis of the operational and organisational financing behaviours of the contemporary far right, this paper finds this financing threat to be largely incompatible with the counterterrorist financing (CTF) regime and identifies several shortcomings in the regime as it stands.
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The vast majority of far-right violence emits meagre financial signals before an attack is carried out, which is incongruous with a CTF regime that depends on financial institutions to spot overt red flags in transaction data. Further, the CTF regime’s reliance on terrorism designations and resultant sanctions to financially isolate groups is at odds with the far right, whose organisational structures are unprecedentedly fluid and adaptable to such restrictive measures. In the absence of clearer direction from states, the private sector (especially operators of online platforms) has responded to pressure to independently ‘cut off’ perceived far-right ideologues and agents from accessing their services. Although laudable in their intention, such responses have precipitated several adverse consequences, including the spoiling of opportunities to collect financial intelligence on individuals and networks that could feed into more effective disruption efforts.
In recalibrating the CTF regime to make it more suitable for the far-right threat of today, this paper makes the following recommendations:
- To increase the likelihood of pre-attack financial signals being identified by financial institutions and used for preventative purposes, states should broaden public–private collaboration in the form of multiagency ‘fusion cells’ involving social services, health, education, security intelligence services and financial institutions for real-time intelligence sharing on persons of interest.
- To maximise the near-term effectiveness of far-right terrorism designations for disrupting finance, states should provide their private sector (particularly financial institutions) with detailed lists (including names and identifying information) of real or legal persons linked to designated far-right groups to aid implementation.
- In recalibrating their national CTF regimes to meet the threat posed by the far right, states should reclaim authority and safeguard freedom of expression by denying private sector actors a free pass to make decisions, largely on the basis of reputation, about what constitutes violent extremism, as opposed to merely distasteful ideology.
- In building CTF regimes fit to combat far-right financing, states should include oversight mechanisms to forestall the abuse of anti-financial crime measures for authoritarian ends. Responding to far-right mobilisation using financial tools could also set dangerous precedents for authoritarian onlookers if not done transparently.
Senior Research Fellow
Centre for Financial Crime and Security Studies