20041007 In Hot Pursuit of Terrorist Funds

The final issue to touch on in this paper is the use of assets to provide financial benefits elsewhere.

The use of a certificate of deposit or a charge over a property may mean that funds are raised in another country. This is a very simple mechanism by which funds are raised for the benefit of future crime – but it is also used as a laundering mechanism. My final point is therefore one of some hope: this scheme – regardless of whether it is laundering or fund raising will bear similar hallmarks. There will be little more than a pawn-broking proposition – there may not be a good business plan, or the plan might fall apart rapidly leaving the lender to collect on the security. Whichever it is, this is an area where a lack of due diligence on the part of the lender may result in the lender being seen as having failed in his duty to detect and deter the funding of terrorism, simply because it is probably the only reasonably easy to spot transaction.