Informist, Wednesday, Jul. 9, 2025

NEW DELHI – The Financial Action Task Force has flagged concerns over the growing popularity of online modes of terrorist financing. The agency has uncovered instances of funding using social media, e-commerce platforms and messaging channels, and online transactions with virtual assets using virtual private networks or VPN, the FATF said in its report titled 'Comprehensive Update on Terrorist Financing Risks'.

In its report, the FATF said that the terrorist outfit Jaish-I-Mohammed had procured material from the e-commerce platform Amazon to orchestrate the suicide bombing attack in Pulwama in 2019, which claimed the lives of 40 Indian security personnel. "Investigations revealed the cross-border movement of a large quantity of explosives into India. Notably, a key component of the improvised explosive device used in the attack--aluminium powder--was procured through Amazon," the report said. "This material was used to enhance the impact of the blast."

Digital platforms such as social media, messaging applications, and crowdfunding sites are increasingly abused for terrorist financing, particularly when they offer integrated payment services that bypass due diligence, the report said. "Although the level of abuse of virtual assets (VAs) by terrorists remains difficult to measure precisely, their use is increasing, with some groups systematically leveraging VAs and employing obfuscation techniques and/or shifting towards alternatives VAs promoted as more private and secure."

The Islamic State of Iraq and the Levant or ISIL had transacted using VPN to facilitate the attack on security personnel at Gorakhnath Temple in 2022, according to FATF. The financial investigation revealed that the attacker transferred INR 669,841 through PayPal to foreign countries in support of ISIL, using international third-party transactions and using VPN services to obscure the Internet Protocol address, the report said. "He also received INR 10,323.35 from a foreign source," the report added.

"ISIL has been reported to have used the exchange of video gaming points to fiat currency, demonstrating the potential for abuse within these digital environments. Similarly, Al-Shabaab is reported to have abused an online gambling platform registered in the Caribbean for terrorist financing, underscoring the risk that arises across distant jurisdictions and the resulting challenges for detection and enforcement," the agency said in its report. "There have also been reports of minors being involved in in-game transactions ultimately benefiting terrorists."

The FATF, without naming any country, has also said there have been instances of state sponsorship of terrorism. "A variety of publicly available sources of information and delegations' inputs to this report indicate that certain terrorist organisations have been and continue to receive financial and other forms of support from several national governments," the report said.

India, after the terrorist attack in Pahalgam in April, vouched for the inclusion of Pakistan in the terrorist financing watchdog's grey list. The FATF had excluded Pakistan from the list of countries under increased monitoring or grey list in October 2022. End

Reported by Krity Ambey

Edited by Ashish Shirke

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