Donation-based crowdfunding the future of terrorist financing or a method counteracted ex-ante by European authorities

Daniel Cookman

Journal of Money Laundering Control, 2024, vol. 27, issue 6, 1005-1012

Abstract: Purpose - This study aims to analyse the adequacy of current and proposed European legislative measures for the mitigation and prevention of the use of donation-based crowdfunding to enable terrorist-related financing. Design/methodology/approach - This study examines current and proposed European legislative and academic literature. To provide analysis on the current terrorist financing risks posed by donation-based crowdfunding. Findings - The activity of European donation-based financing is not in theory completely removed from AML/CFT prevention, mitigation and reporting standards. European credit institutions and payment service providers are required to implement AML/CFT internal controls that target their entire customer base, which includes situations whereby an individual and/or individuals elect to engage in donation-based funds transfer. Current European crowdfunding and proposed crowdfunding AML/CFT standards target investment and consumer credit provision by credit and financial institutions and credit and mortgage intermediaries. Donation-based terrorist financing will likely remain a consideration for subversive groups and lone wolf individuals seeking integrated financing. European credit institutions and payment service providers will be required to cooperate both internally and externally on a national and transnational basis to prevent the materialisation of donation-based financing risks, ex-ante. Originality/value - A desktop review composed by the author.

Keywords: Donations; Crowdfunding; Terrorist financing; Adequacy of measures (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jmlcpp:jmlc-12-2023-0199

DOI: 10.1108/JMLC-12-2023-0199

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