Relation Between Money Laundering and Terrorist Financing:

It has been mentioned earlier in the section, Terrorist financing is quite similar to Money launder thus, it is important to understand relation between money laundering and terrorist organisation to have a better understand of terrorist financing and its activities

As it’s widely known all the terrorist organization have been related to the traditional washing schemes, which are related to money laundering while trying to stay undetected by, uses various methods for movement of their funds. The important reason behind why they use money laundering to transfer the money is because both of them are correlated to each other in the way they use fund, their source of the fund, and hiding the purpose and the ultimate beneficiary.

Money launderer has to deal with huge amount of money and has to launder it without getting unwanted attention. As mentioned in earlier section terrorist organization when it comes to the amount or value, they have to be able to have certain amount of fund to meet their direct Operational cost - where they need to maintain the infrastructure, paying salary, recruiting, training, etc. and the other is related to direct attack - buying weapon, communicating, traveling, fake document etc. Cost of operational activities of terrorist organization is much higher than direct attack cost itself, however purpose of the fund needs to be kept secret in both the cases of funding requirement. This gives an idea and general reason why they use money laundering techniques because they have to deal with significant amount of money along with making sure to not get detected by the authority as money laundering technique are designed to avoid unwanted attention.

Another reason why they behave like money launders, because they wanted to make sure that origin of the fund remain undetected, as mentioned in source of finance section, Terrorist organisation use various source of illegal or criminal activity, such as drug tracking, extortion, Oil sales and etc. and also fund themselves by black washing, where they found themselves from charities, state sponsorship, legitimated business and self-funding they don’t wanted their sources to get unwanted attention because even in case of legitimate business, they want to avoid attention as it can lead to prosecution of the individual or the entity involved in the transaction.

The last reason why they use laundering schemes is to avoid detection and concealment of their true intention. Technique mention with case study earlier gives us an idea that, how terrorist moving their fund and the above discuss help us to understand that why such activities are being used by the terrorists.