Terror financing increases amid Coronavirus, widespread use of crypto

Money laundering and terror financing have flourished in the previous one year as governments and nations across the world directed their concentration only on combating the novel Coronavirus pandemic. The new era of the digital asset in the form of crypto has surged terror financing.

Crypto is encountering a rise in the market value in spite of the sharp decline in economic activities all around the world because of the pandemic.

The sudden change in the scale and pattern of financial transactions in the wake of the pandemic has offered an opportunity to terrorists and criminals.

Though money laundering and terror financing are different tasks, both are linked to each other as they unlawfully support the lacunae and weakness of the financial system to carry out criminal activities.

Meanwhile, terrorist financing and the global money-laundering monitor Financial Action Task Force (FATF) maintain Pakistan in its ‘grey list’ for failing to weed out money laundering and terror financing. FATF noted that while Pakistan completed all but 1 out of 27 items, but in its Anti Money Laundering (AML) and Counter Terror Financing (CTF) effort, it has failed to appropriately prosecute and investigate commanders and senior leaders of UN-designated terrorist groups.

In a report, FATF observed that almost 360-degree change in the behavior because of the pandemic – ‘whether the behavior of companies, people or governments have in turn presented criminals with new opportunities to commit crimes and launder the profits.

The International Monetary Fund (IMF) has highlighted that terrorism financing and money laundering activity in one nation can have serious cross-border and even global adverse effects.

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