Most of the funding obtained by extreme right-wing groups comes from legal sources, such as donations, membership fees, and commercial activities.
The FATF (Financial Action Task Force) has published a new report, for the first time focusing on ethnically or racially motivated terrorism financing, or EoRMTF.
The report was finalised at the fourth FATF Plenary under the German Presidency of Dr Marcus Pleyer on 21-25 June. The outcomes of the Plenary were published here.
The report focuses on the funding behind ethnically or racially motivated terrorism, also referred to as extreme right-wing terrorism, or ERWT.
It says extreme right-wing attacks have increased in recent years, highlighting the need to raise awareness about the complex phenomenon and its financing.
While most of these attacks were carried out by self-funded lone actors, they can also involve small and medium organisations, as well as transnational extreme right-wing movements.
Few countries have designated extreme right-wing groups or individuals as terrorist threats for various reasons. These include a lack of identifiable command and control structures, greater focus on more established foreign terrorist threats, and legal constraints linked to freedom of speech.
Extreme right-wing groups can obtain funding from criminal activity, but most funding comes from legal sources, such as donations, membership fees, and commercial activities, the report says – adding that these groups appear to be less concerned with concealing their transactions than in other forms of terrorism financing.
“These groups are becoming increasingly sophisticated in the way they move and use funds and there are growing transnational links between the groups,” the FATF says.
Extreme right-wing groups appear to also be disguising their financial activities by structuring transactions to avoid bank reporting thresholds, moving away from traditional financial institutions, or using vetting processes to receive donations.
Some extreme right wing groups also use virtual assets like Bitcoin to move funds, helping them maintain anonymity when making transactions. One group even created its own stablecoin where transactional data only lasted 24 hours before becoming untraceable.
The report notes that Covid-19 lockdown restrictions have significantly affected an important financial source for extreme right wing groups, namely the organisation of concerts and events.
However, the Covid-19 crisis has also provided a recruitment opportunity for violent extremist groups, which may mean that in the coming period they may be seeking new methods of funding or to increase their use of existing funding sources.
The report highlights the challenges in tackling EoRMTF and preventing attacks – including challenges related to how countries view the threat.
The report encourages countries to continue to develop their understanding of EoRMTF, including by considering it in their national risk assessments.
The FATF encourages public, private and international partners to work together to identify the threats and exchange best practices on combating EoRMTF.
The full report is available here.