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Exploring Nigeria’s Vulnerability in cyber warfare

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In August 2012 Boko Haram reportedly hacked the personnel records databases of Nigeria’s secret service.  The individual who successfully compromised the covert-personnel data system indicated the breach was executed in the name of Boko Haram and as a response to Nigeria’s handling of interactions with the group

.[1]   The retaliatory attack revealed the names, addresses, bank information and family members of current and former personnel assigned to the country’s spy agency. The attack would not have tremendous significance in and of itself.  However, it represents a substantial shift in tactics for a group whose name connotes an anti-Western stance. Until recently Boko Haram attack strategy was far from technological.  However, since its association with Al Qaeda, Boko Haram has demonstrated a vastly changed approach to executing its attacks.  Attacks are now more violent and reflect the markings of training by al Qaeda personnel.  Given that cyber space has been part of the terrorists’ warfare tool kit since 1998 when the Tamil Tigers executed a distributed denial of service attack, [2] and al Qaeda has used the Internet as a vital communication vehicle since 1996, Boko Haram’s incorporation of cyber into its arsenal is almost inevitable.  More importantly though, Boko Haram’s access to an individual who can execute such a successful attack is indicative of the cyber arsenal workforce capability available to any group or nation that wants to employ it.  Boko Haram’s tactic advancement clearly demonstrates that Nigeria and its neighboring Sahel region neighbors are ripe for exploitation as a cyber warfare hub.

Cyber warfare is experiencing a boon.  The success of activities like Ghostnet, Stuxnet, Byzantine Hades, and Titan Rain has shown that the demand for such products will not slow anytime soon. Nation-states have begun to incorporate cyber warfare against opponents’ cyber space attacks into their national security strategy.[3] However, the reality is that nations executing these attacks do not always want to be identified as the perpetrators.  Case in point- after a student from the University of Electronic Science and Technology of China executed a vast nation-state intrusion called “Ghostnet,” several media accounts of the attack wondered if China was involved.  China denied any knowledge of the attacks and the sensitive information retrievals from 103 invaded national security databases remained unclaimed.   The Chinese continued their public stance of denying culpability when a report on corporate intrusions specifically named the Chinese Peoples Liberation Army’s Unit 61398.  According to the report investigators traced several intrusions into United States (U.S.) corporate and government secure information technology systems to the PLA unit.

Just as China prefers a public stance of denial, so might other nations. Public response to Ghostnet and Stuxnet made it apparent nations would not always want it known that they were perpetrators of an attack.  It was clear that for nation-states to continue to incorporate this new weapon, they had to accommodate the sensitive diplomatic nature of such attacks by finding an alternate approach.  But we have to acknowledge that their appetites for these attacks will not diminish.  If anything, they will grow. What could this mean? If we use Boko Haram as an example, we can suggest an alternate approach that leverages the chaotic political situation and burgeoning supply of talented cyber personnel within Nigeria and the Sahel.  Executing attacks from this third-party cyber location, offers attack perpetrators and the cyber arms industry the ability to outsource, just as manufacturing does.[4]

If we use the impact of improvised explosive devices on Afghanistan and and Iraq as an example, Nigeria and the Sahel can offer resources for “niggling” attacks that target nation-states with “improvised explosive device” level attacks.  These attacks would cause damage that is cumulatively significant, but individually not.[5] The costs could remain low, as the readily available workforce functions in a region with an average annual income of $1180 (U.S. dollars). The nation-states employing this workforce will have a great cost-benefit ratio and the workforce itself will achieve success in their chosen field.[6] While the Vice Chancellor of Osun State University is not pleased that the stated goal of computer science students was “making money in cyber crime”[7] the reality is perpetrators of cyber warfare can use the demographic of Nigeria and the Sahel to train recruits and execute attacks without impunity.  The Sahel has an economic environment that is conducive to cyber crime activities, an exploitable sophisticated cyber highway, and an area where officials are more focused on political distractors than enforcing information communication technology regulations.

Nation-state with Sufficient Political Distractors

Nigeria and its Sahel neighbors have many cultural influences, particularly from a tribal perspective.  In addition, there are many natural resources available for state use to contribute to the country’s gross national product. But while this should be a positive, they are heavily affected by the corruption and direct disregard demonstrated by government leaders.  As a result, unemployment is high, there is minimal foreign investment, and the black market runs the shadow economy with money laundering, bank fraud and identify theft running rampant.  These factors contribute significantly to many of the nations in the region ranking high on the Failed State Index, from a total perspective and reflecting a high economic decline total.[8], [9]

Modern Fiber-Optic Information Communication Infrastructure

In the year 2000 only 4.5 million of Africa’s one billion people were categorized as Internet users.  That was a little more than .42%. However, as the continent, its resources, and potential 2050 workforce were combined to become opportunities for investors, it became apparent to these investors, and the African nations where this workforce lives, that tremendous improvements to the continent’s information highway were imperative.

Those improvements started with the Eastern Africa Submarine System (EASS) fiber-optic cable proposal in 2003.[10]   Other improvements were the 2009 fiber-optic submarine cable system Seacom, the 2010 Western Africa cable system, and the 2014 projected finish “connectivity” project. The continent now boasts over 15% Internet users, with some individual states experiencing much higher usage.[11] World bank nations that recognized this need and invested in the highway’s improvements include Brazil, Russia, India and China (BRIC). South Africa joined the effort when it became a part of BRIC in 2010.

With these state of the art advancements, countries like Mozambique, Tanzania, Kenya, Somalia and the Sudan enjoy connectivity via mobile telephone technology to almost anywhere in the world.  The continent is now seen as an attractive foreign investment destination pursued by more than the initial chance takers. Residents of almost any state can access mobile technology, changing the definition of “remote Africa” and the number of marginalized populations.

But these same potential economy-boosting continental links also serve as the tool for cyber criminals to advance their entrepreneurial skills.

Cyber Warfare Attacks

The attacks executed by the perpetrators of Stuxnet, Ghostnet, and even Flame, were initially conceived and deployed incognito.  Flame functioned for almost two years before discovery; and when found, the United States did not initially acknowledge its role.  The negative international response to Flame and Ghostnet was enough for nation-states to realize that today’s military strategy-international diplomacy equilibrium demands a more discreet employment of this new weapon.  One that does not jeopardize current diplomatic relations or upset conventional weapons partners. The nations left vulnerable after each of these attacks also recognized that they would be at a disadvantage if they did not begin to include strategic cyber offensive and defensive operations into their national defense blueprint.  While the Flame attack was directly attributed to the United States, the Ghostnet attack was never conclusively identified as China directed. The young researcher identified as Ghostnet’s perpetrator was a well-known hacker who never implicated any other person or entity in the effort.

What if a nation-state employed the tactic and this type of workforce on a future attack?  That is: if a nation-state employed a third-party entity that is willing to NOT implicate the nation-state, could that nation-state successfully execute such a cyber warfare attack and not have to face the wrath of its international partners?

Rafal Rohozinksi, one of the investigators of Ghostnet and cofounder of Information Warfare Monitor, has suggested that such outsourcing could become a wave of the future.  Rohozinksi cites the factors that could contribute to the trend.  Nations need an alternative that offers anonymity, preserves current diplomatic balances and employs resources that are outside the nation’s jurisdiction.  To ensure anonymity remains throughout the event and its investigation, local resources from a jurisdiction that not prone to enforcing International Communications Technology (ICT) rules and regulations.[12]

According to a 2011 Harvard School of Public Health assessment Africa is expected to contribute 49% of the world’s 2050 population growth.[13] Rohozinski insists this 2050 workforce will have a demographic that is conducive to cyber crime: young, talented, from a developing nation, possessing a value system that has previously, and would in the future, support participation in or instigation of acts of cyber crime.[14]

If Rohozinski is correct, then we have to recognize that developing nations without strong ICT rules and regulation enforcement, nations with civil unrest or nations that lack services could serve as third party locations and perpetrator source.

The perpetrator source could easily begin with the University students who have professed a desire to work in the cyber crime industry.  These University students have already participated in attacks that focus necessary to execute such missions, one potential source of such attacks could very well be outside the borders of the

Taken together these factors make Africa attractive to almost any investor, especially any who inhabit the shadowy world of cyber crime. To hacking investors the limited resources needed to establish a presence is particularly inviting.  There is already an experienced cyber crime workforce, a reduced enforcement of ICT rules and regulations, a strong malware history and an economic environment that makes the potential very attractive.  As a business venture, there are few negatives.

Which Cyber Crimes?

Criminal use of the region’s Information highway already include electronic mail scams, scam letters that range from purchase of real estate, disbursement of money from wills, to sale of crude oil at below market prices. Communication usually occurs through electronic message via fax, e-mail or cell phone. Verification is difficult so victims ultimately pay the fees without evidence to validate the claim of the perpetrator.

While these types of cyber crime are perpetrated on a large scale in countries like Nigeria, the crimes themselves are not target specific.  The perpetrators initiate several scams at a time so that the perpetrator financially benefits, on average, from some, if not all, of the scams.  No one victim is regarded as the single important prey.

 Given the ideal conditions the region offers for third party cyber warfare attacks, several questions must be answered for national security strategists to understand the threat they could potentially face: would these same Nigerian or Sahel region cyber crime perpetrators initiate their perfected scams for another entity? Are they willing to expand their skill set and advance into target specific entities?  Finally, if they were willing to initiate target specific entities, would they execute an attack on infrastructure?  If they initiate the crime, is there a limit to the type of crimes they will launch?

There is already a perception/acceptance of students who “steal trade secrets, research documents or supplier’s agreements.  A cyber warfare or cyber espionage Internet malware, its indicators and its codes are available on the web, but are the already cyber crime literate workforce members motivated to execute these types of attacks? If the Boko Haram attack is an indication, they very well may be.  An almost unencumbered access to high quality information communication technology, combined with the computer literate young of 2050, make it wise for potential target nations to understand the threat this region could represent for them.  They must accept the reality that the opportunity this new industry offers the Sahel’s employment-opportunity-constrained workforce, and the potential to earn a living far above the current $1180 (U.S dollars) annual income, make the Sahel’s attractiveness as a cyber warfare third-party haven almost irresistible. [15]

Conclusion

The Sahel is already home to a variety of illicit activities, and adding cyber warfare to that list is not far fetched. Nation-states could benefit from expanding their repertoire of weapons, terrorist actors could include it in this arsenal against the West, and both would achieve their goals and objectives without significant infrastructure modifications. This could redefine cyber crime if both the nation-state and the terrorist actors, reconcile their value system with incorporating this approach to expanding their warfare arsenal.

These perpetrators of ill intent (whether nation-state or terrorist actor) recognize that, in today’s world, their victims do not have the option of “no presence on the web.” They can, therefore, inflict damage, pinpoint attacks, and execute attacks without significant cost. Their potential victims must therefore learn how to counter this attack approach while minimizing negative impact on the already fragile economies of the Sahel and, even, Nigeria.

The nations in the region, themselves, have to also include this consideration as they develop their law enforcement approach to information communication technology regulation enforcement.  Each nation already has shadow economies from the illicit crime and that economy feeds, houses, and clothes many of its citizens.  The governments of the area have to form a coalition with investing countries and identify alternates for these potential “failed state mercenaries and their robust cyber warfare attack tools.  We underestimated Boko Haram in the past.  We should not underestimate the bellwether Boko Haram’s cyber attack may represent.

(*)Exploring Nigeria’s Vulnerability in cyber warfare

By Denise N. Baken and Ioannis Mantzikos

Speech prepared for Society for the Study of Terrorism Conference 27-28 June 2013, University of East London

Bibliography

Adedayo, Olugbenga. “Secondary School Students’ Perceptions of Incidences of Internet Crimes Among School Age Children in Oyo and Ondo States, Nigeria (dissertation).” University of Ibadan, Nigeria, 2008. http://www.kaspersky.com/images/secondary_school_students_perceptions_of_incidences_of_internet_crimes_among_school_age_children_in_oyo_and_on-10-75860.pdf.

Adeniran, Adebusuyi. “The Internet and Emergence of Yahoo boys sub-Culture in Nigeria.” International Journal of Cyber Criminology 2, no. 2 (December 2008): 368–381.

Adigun, Bashir. “AP Exclusive: Nigeria Secret Police Details Leaked.” Salon, August 30, 2012. http://www.salon.com/2012/08/30/ap_exclusive_nigeria_secret_police_details_leaked/.

“Africa Internet Usage, Facebook and Population Statistics.” Internet World Stats: Usage and Population Statistics, June 30, 2012. http://internetworldstats.com/stats1.htm.

Baken, Denise, and Ioannis Mantzikos. “Cyberspace Improvised Explosive Device and the Failed State Catapult-The Strategic Symbiotic Relationship Failed State Status Offers Nation-State Cyberwarfare Arsenals.” In New-Old Salafi/Al Qaeda Threats.
Washington, DC: Association fro the Study of the Middle East and Africa, 2012.

Denning, Dorothy. “Cyberterrorism – Testimony Before the Special Oversight Panel on Terrorism Committee on Armed Services U.S. House of Representatives.” Georgetown University, May 23, 2000. http://www.cs.georgetown.edu/~denning/infosec/cyberterror.html.

Li, Hao. “World Population to Top 9 Billion by 2050, 49% Growth from Africa.” International Business Times, July 29, 2011. http://www.ibtimes.com/world-population-top-9-billion-2050-49-growth-africa-820105.

Mills, Elinor. “Report: Countries Prepping for Cyberwar.” CNN, November 17, 2009. http://articles.cnn.com/2009-11-17/tech/cnet.cyberwar.internet_1_south-korea-cyberwarfare-cyberattack?_s=PM:TECH.

Osman, Osman Dahir. “Submarine Fiber Optic Route to Somalia.” Hiiraan Online. September 27, 2007. http://www.hiiraan.com/news2/2007/sept/submarine_fiber_optic_route_to_somalia.aspx.

Panel on Cyber Crime. 41st St Gallen Symposium. University of St. Gallen, Switzerland, 2011. http://www.youtube.com/watch?v=DpRYXRNWka0&feature=youtube_gdata_player.

Shuaib, Shuaib. “allAfrica.com: Nigeria: Cyber Crime, Our Biggest Problem – VC.” News. allAfrica.com, September 1, 2010. http://allafrica.com/stories/201009010416.html.

“The Failed States Index 2012 Interactive Grid.” FFP The Fund for Peace, June 18, 2012. http://www.fundforpeace.org/global/?q=fsi-grid2012.

“UNICEF – At a Glance: Nigeria – Statistics.” UNICEF. Accessed February 20, 2013. http://www.unicef.org/infobycountry/nigeria_statistics.html.

[1] Bashir Adigun, “AP Exclusive: Nigeria Secret Police Details Leaked,” Salon, August 30, 2012, http://www.salon.com/2012/08/30/ap_exclusive_nigeria_secret_police_details_leaked/.

[2] Dorothy Denning, “Cyberterrorism – Testimony Before the Special Oversight Panel on Terrorism Committee on Armed Services U.S. House of Representatives,” Georgetown University, May 23, 2000,
http://www.cs.georgetown.edu/~denning/infosec/cyberterror.html.

[3] Elinor Mills, “Report: Countries Prepping for Cyberwar,” CNN, November 17, 2009, http://articles.cnn.com/2009-11-17/tech/cnet.cyberwar.internet_1_south-korea-cyberwarfare-cyberattack?_s=PM:TECH.

[4] Denise Baken and Ioannis Mantzikos, “Cyberspace Improvised Explosive Device and the Failed State Catapult-The Strategic Symbiotic Relationship Failed State Status Offers Nation-State Cyberwarfare Arsenals,”
in New-Old Salafi/Al Qaeda Threats (presented at the 5th Annual ASMEA Conference-History and the “New” Middle East and Africa, Washington, DC: Association fro the Study of the Middle East and Africa, 2012).

[5] Ibid.

[6] Shuaib Shuaib, “allAfrica.com: Nigeria: Cyber Crime, Our Biggest Problem – VC,” news, allAfrica.com, September 1, 2010, http://allafrica.com/stories/201009010416.html.

[7] Baken and Mantzikos, “Cyberspace Improvised Explosive Device and the Failed State Catapult-The Strategic Symbiotic Relationship Failed State Status Offers Nation-State Cyberwarfare Arsenals.”

[8] The Failed State Index rates several indicators, one of which is economic decline.  The maximum number a country receive for any indicator is 10.

[9] “The Failed States Index 2012 Interactive Grid,” FFP The Fund for Peace, June 18, 2012, http://www.fundforpeace.org/global/?q=fsi-grid2012.

[10] Osman Dahir Osman, “Submarine Fiber Optic Route to Somalia,” Hiiraan Online, September 27, 2007, http://www.hiiraan.com/news2/2007/sept/submarine_fiber_optic_route_to_somalia.aspx.

[11] “Africa Internet Usage, Facebook and Population Statistics.”

[12] Panel on Cyber Crime, 41st St Gallen Symposium (University of St. Gallen, Switzerland, 2011), http://www.youtube.com/watch?v=DpRYXRNWka0&feature=youtube_gdata_player.

[13] Hao Li, “World Population to Top 9 Billion by 2050, 49% Growth from Africa,” International Business Times, July 29, 2011, http://www.ibtimes.com/world-population-top-9-billion-2050-49-growth-africa-820105.

[14] Panel on Cyber Crime.

[15] “UNICEF – At a Glance: Nigeria – Statistics,” UNICEF, accessed February 20, 2013, http://www.unicef.org/infobycountry/nigeria_statistics.html.

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Terrorism

U.S.: From mass airstrikes to targeted terrorist attack

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The U.S.-led military operation “Inherent Resolve” has begun in August 2014. Its ostensible purpose was a struggle with the gaining ground ISIS at that moment. As the operation develops, Australia, France, Great Britain, Saudi Arabia, the Netherlands, Belgium and other countries joined the American airstrikes.

United forces, with purposes to show power and strengthen its influence in the region carried out more than three thousand airstrikes in the first year, resulting in thousands of victims among civilians. It is worth to note that member states of the coalition didn’t try to hide the fact that their actions caused the death of thousands of people. In 2018, British authorities justified civilian deaths by the fact that militants used them as human shields and it was impossible task to minimize losses.

According to “Airwars”, the British non-government organization, from 2014 till 2019 up to 13,190 civilians were killed in Iraq and Syria as a result of the international coalition actions.

However, despite all the “efforts” and the Pentagon’s loud statements about the fight against international terrorism, the fact of the continuously growing territory controlled by the militants testifies the opposite. In addition, since 2015, facts of provided by Washington direct support to terrorists have begun to be revealed. U.S. and its allies produced weapons were repeatedly found in the territories liberated from jihadists. So, for example in 2017 during armed clashes with government troops militants used anti-tank TOW-2 and SAMS air defense systems of the U.S. production. Also, American medicines, communication tools and even component kits for UAVs were found in positions abandoned by terrorists.

The negative reaction of the international community began to rise in this context and Washington had no choice but to change the strategy of its activity in Syria. The practice of mass airstrikes was replaced by targeted terrorist attacks against government forces by their backed militants.

For implementing of such kind of actions, U.S. retained its military presence in Homs province where their military base Al-Tanf is deployed. A huge amount of evidence U.S. servicemen training armed groups fighters is widely accessible. Moreover it’s known that 55 km zone around Al-Tanf has been inaccessible to government troops for years and Syrian army attempts to enter the area were suppressed by the U.S. airstrikes.

At the same time, IS militants have been spotted moving in this region without encumbrance and used the base as a safe zone for regrouping. Terrorists slipped in Deir ez-Zor, Palmyra, as well as Daraa and As-Suwayda from this area. In addition, the U.S. has created the Jaysh Maghawir al-Thawra group to fight government forces in the eastern section of the border between Syria and Iraq. Initially, the armed group was created to fight against government troops, but after a number of defeats they started to protect the area around the Al-Tanf.

Up to the date Washington continues to insist on Bashar al-Assad government “illegitimacy” and actively supports so-called moderate opposition. Pursuing its selfish economic and political goals, the United States counters to the international law, completely ignoring the tens of thousands victims among civilians and millions of refugees flooded Europe. Although the role of the White House and its allies in supporting terrorist groups is difficult to overestimate, the United States obviously will not consider it enough.

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FATF: A Sword of Damocles or a tool of financial discipline?

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Pakistan has been groaning under the Financial Action Task Force restrictions. There is marked contrast between Pakistan’s and India’s view of Pakistan’s current status, compliant or tardy with regard to most of the conditions. Pakistan oozes optimism that it has complied with most of the conditions.  India however is pessimistic about Pakistan’s ability to get over the bar anytime soon.

Anti-money-laundering legislation

One hurdle to meet the FATF conditionalities was to have a permanent mechanism to nab and prosecute the offenders. Pakistan’s federal cabinet has already approved a new set of rules to amend Anti-Money-Laundering (Forfeited Properties Management) Rules 2021 and the AML (Referral) Rules 2021. Thus, Pak government is now all set to set to introduce new rules on forfeiture, management and auction of properties and assets relating to Anti-Money Laundering (AML) cases and transfer of investigations and prosecution of AML cases from police, provincial anti-corruption establishments (ACEs) and other similar agencies to specialised agencies to achieve remaining benchmarks of the Financial Action Task Force (FATF).

These rules and related notifications for certain changes in existing schedule of Anti-Money Laundering Act 2010 (AMLA) would come into force immediately to be followed by appointment of administrators and special public prosecutors for implementation.

These legislative steps would help the FATF determine whether Pakistan has complied with three outstanding benchmarks, out of 27, that blocked its exit from the so-called grey list in February this year. The FATF has planned several meetings in the second week of June, ending in the FATF plenary on June 21-25.

The three outstanding action points (out of total 27) include (i) demonstrating that terrorist financing (TF) investigations and prosecutions target persons and entities acting on behalf or at the directive of the designated persons or entities; (ii) demonstrating that TF prosecutions result in effective, proportionate and dissuasive sanctions; and (iii) demonstrating effective implementation of targeted financial sanctions against all designated terrorists, particularly those acting for them or on their behalf.

Within framework of the amended rules, the Pak government would appoint dozens of administrators with the powers to confiscate, receive, manage, rent out, auction, transfer or dispose of or take all other measures to preserve the value of the properties and perishable or non-perishable assets (including those at go downs, maalkhanas or any other place) to be confiscated under the AML 2010 rules or court orders pursuant to proceedings under AMLA 2010.

The regional directors of the Anti-Narcotics Force would be designated as administrators for the ANF, customs collectors for the Federal Board of Revenue, directors of directorates of intelligence and investigation of the Inland Revenue Service for the IRS, zonal directors for FIA and additional directors of recovery, disposal and assets management cells for National Accountability Bureau.

Valuation of inventories

The AML (Forfeited Properties Management) Rules 2021 specify how the inventories would be measured, described or defined, protected and evaluated for auction and how to complete all processes thereto, including constitution of auction committees and how properties would be quantified or classified like if a property is of residential, commercial or industrial nature and what should be its market value or sale price etc.

For example, the movable case property worth more than Rs100,000 would be kept in the locker or vault in the State Bank of Pakistan, district or tehsil treasury or any nationalised bank. For withdrawal of such movable properties, the agency concerned would designate two officers of grade-17 or above and prior written permission of next supervisory officer of the agency would be required.

Each agency would establish a central asset recovery office to ensure assets recovery and management of the forfeited property and keep a designated central account with the SBP maintained by the ministry of finance where proceeds of property would be remitted by all agencies after attainment of the finality of forfeiture order by a court. All investigating and prosecuting agencies would exchange financial intelligence and information about the properties with other stakeholders for expeditious confiscation and forfeiture under the AMLA 2010.

Transfer of cases to competent authorities

The Anti-Money Laundering (Referral) Rules, 2021 are being introduced to enable transfer of the cases from one set of investigation agencies to another. If police, the ACEs or any other governmental organisations, other than investigating and prosecution agency under the AMLA, finds that an offence under the AMLA 2010 has been committed and such agency lacks jurisdiction to take cognizance of it, the head of such would refer the matter to the head of the agency concerned having jurisdiction to investigate.

Police, the ACEs or other governmental organisations would continue an inquiry or an investigation of the offence and would take necessary measures to preserve and retrieve the relevant information and evidence and case properties till formal acceptance by the investigating and prosecuting agency concerned as set out in the relevant clause of the AMLA and formal handing over and taking over of complete record.

After acceptance of the case by the competent investigating and prosecuting agency, police or ACEs etc would hand over complete record, including case files, record of proceedings and seizure memos along with relevant evidence, property and other material seized and the accused in custody, if any. Such investigating and prosecuting agencies would resume all the proceedings under the said act including to examine, re-examine persons concerned and other oral and documentary evidence and would expeditiously take steps as necessary for just finalisation of the proceedings.

Adequate number of special public prosecutors would be appointed for the Anti-Narcotics Force and Counter Terrorism Department (CTD) besides a separate panel of lawyers for customs and the Internal Revenue Service of the Federal board of Revenue. Also, law officers not below the rank of assistant director legal would be appointed for the Federal Investigating Agency and special public prosecutors for the National Accountability Bureau.

Pakistan also has to issue “National Policy Statement on Follow the Money (NPSFM)”. Through this statement and rules listed above, Pakistan’s compliance with FATF recommendations in Post Observation Period Report (POPR) would further improve with corresponding enhancement in the ratings or effectiveness of the FATF’s relevant Immediate Outcomes. Pakistan’s POPR would be reviewed by the FATF’s Asia-Pacific Joint Group (A-PJG), and based on the report of this group, the FATF would decide further course of action on Pakistan’s progress on the POPR in its plenary scheduled in June 21-25, 2021.

The NPSFM commits Pakistan to tackling money laundering and terrorist financing as a matter of priority during investigations, prosecutions, and subsequent confiscation in all money laundering, terrorism financing and high risk predicate crimes by adopting universal approach to combating money-laundering and terror-financing through generating sound and effective financial intelligence reports for the consumption of law enforcement agencies and maintaining risk-sensitive anti-money-laundering  regime to enhance cooperation and coordination amongst the such  stakeholders both domestically and internationally.

The government is also committed to protecting the financial system and the broader economy in Pakistan from criminality through a robust financial system to ensure that dirty money does not find its ways into the financial system. The government would ensure a robust beneficiary identification system, deterring financial crime as it deprives criminals of the proceeds of their crimes and removes financial support for terrorism and further ensures that targeted financial sanctions are implemented in letter and spirit.

Further, it would ensure a transparent, robust and efficient approach to investigating money laundering and terrorist financing and to the seizure, confiscation and management of criminal assets by supporting relevant agencies in cooperatively achieving this goal.

Compliance

 The Asia Pacific Group (APG) on Money Laundering has improved Pakistan’s rating on 21 of the 40 technical recommendations of the Financial Action Task Force (FATF) against money laundering and terror financing, but retained it on ‘Enhanced Follow-up’ for sufficient outstanding requirements.

The second Follow-Up Report (FUR) on Mutual Evaluation of Pakistan released by the APG — a regional affiliate of the Paris-based FATF — also downgraded the country on one criterion. The report said Pakistan was re-rated to ‘compliant’ status on five counts and on 15 others to ‘largely compliant’ and on yet another count to ‘partially compliant’.

Overall, Pakistan is now fully ‘compliant’ with seven recommendations and ‘largely compliant’ with 24 others. The country is ‘partially compliant’ with seven recommendations and ‘non-compliant’ with two out of total 40 recommendations. All in all, Pakistan is now compliant or largely compliant with 31 out of 40 FATF recommendations.

The Asia Pacific Group announced,

“Overall, Pakistan has made notable progress in addressing the technical compliance deficiencies identified in its Mutual Evaluation Report (MER) and has been re-rated on 22 recommendations,”.

It said recommendations 14, 19, 20, 21 and 27 had been re-rated to comply. These pertain to money or value transfer services, higher risk countries, reporting of suspicious transactions, tipping-off and confidentiality and powers of supervisors.

The APG said Pakistan was re-rated to largely compliant with 15 recommendations — 1, 6, 7, 8, 12, 17, 22, 23, 24, 25, 30, 31, 32, 35 and 40. These include assessing risk and adopting a risk-based approach, targeted financial sanctions relating to terror and terror financing, targeted financial sanctions related to proliferation, non-profit organisation, politically exposed persons and reliance on third parties.

Also, re-rating was done on designated non-financial business & professions (DNFBP) in terms of due diligence and other measures, transparency in beneficial ownership of legal persons and related legal arrangements, responsibilities of law enforcement and investigation authorities, cash couriers, sanctions and other forms of international cooperation.

Another re-rating to partially compliant status was done on recommendation 28 that pertained to regulation and supervision of DNFBPs. The two recommendations on which Pakistan was downgraded to ‘non-complaint’ were 37 and 38 due to insufficient progress and pertained to mutual legal assistance (MLA) with other countries and freezing and confiscation of assets and accounts.

Negative impact of rigorous compliance

The managers of financial institutions in Pakistan are implementing the FATF conditions  without understanding their purpose. They are harassing honest investors. For instance, the manager of the national Saving Centre Poonch house Rawalpindi refuses to issue an investment certificate  unless the applicant submits a host of documents. These documents include a current bank statement, source-of-income certificate besides biodata along with a passport-size photograph. They call for the documents even if the applicant submits a cheque on his 40-year-old bank account.

Deviation from objectives

The financial Action Task Force has ostensibly noble objectives. It provides a `legal’, regulatory, framework for muzzling the hydra-headed monster of money-laundering. It aims at identifying loopholes in the prevailing financial system and plugging them. But, it has deviated from its declared objectives. It has became a tool to coerce countries, accused of financing terrorism or facilitating money-laundering. The FATF is more interested in disciplining a state like Pakistan, not toeing US policies, than in checking money-laundering. The tacit message is that if Pakistan does not toe USA’s  Afghan policy, and lease out air bases for drone attacks, then it will remain on FATF grey list.  

The consequences of being in the grey list may entail economic sanctions and difficulties in obtaining loans from international donors like the International Monetary Fund, World Bank and Asian Development Bank. The trade-and-aid difficulties may retard economic progress of a country.

Favoritism towards India: India has a much larger Gross Domestic Product (US$2875 billion , 2019),  than Pakistan’s paltry US$ 264 billion (2020).Similarly India has a much larger and wealthier Diaspora than Pakistan particularly in the Middle East and the USA.

The hawala (hand to hand transactions) and other money transfer practices among Indians and Pakistanis are similar. Yet the FATF keeps Pakistan always in focus and looks the other way when it comes to India.

Pakistan is a bête noire and India a protégé at the FATF only because of stark geo-political interests. Otherwise the money laundering situation in India is no less gruesome in India than in Pakistan. India has even been a conduit of ammunition to the Islamic State study conducted by Conflict Armament Research had confirmed that seven Indian companies were involved in the supply chain of over 700 components, including fuses or detonating cords used by the so-called Islamic State to construct improvised explosive devices.

Concluding remark

Political considerations, not primary objectives, override voting behavior at the FATF.

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Terrorism

The Autopsy of Jihadism in the United States

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The American counter-terrorism establishment is shocked to know that its current terrorist threat, contrary to conventional wisdom, is not foreign but “a large majority of jihadist terrorists in the United States have been American citizens or legal residents”.

A terror threat assessment by NewAmerica, a think tank comprehensive, up-to-date source of online information about terrorist activity in the United States and by Americans overseas since 9/11, 20 years after 9/11 reported: “…while a range of citizenship statuses are represented, every jihadist who conducted a lethal attack inside the United States since 9/11 was a citizen or legal resident except one who was in the United States as part of the U.S.-Saudi military training partnership”.

The ultimate irony is NewAmerica quoting a terrorist to underline the seriousness of the threat: “Yet today, as Anwar al-Awlaki, the American born cleric who became a leader in Al Qaeda in the Arabian Peninsula, put it in a 2010 post, ‘Jihad is becoming as American as apple pie’.”

Since 9/11 and today, the United States faced just “one case of a jihadist foreign terrorist organization directing a deadly attack inside the United States since 9/11, or of a deadly jihadist attacker receiving training or support from groups abroad”. The report recalls: “That case is the attack at the Naval Air Station Pensacola on December 6, 2019, when Mohammed Al-Shamrani shot and killed three people. Al Qaeda in the Arabian Peninsula claimed the attack and according to the FBI, evidence from Al-Shamrani’s phone  he was in contact with an AQAP (Al Qaeda in the Arab Peninsula) militant and AQAP prior to his entry to the United States…”

In the last two decades, “jihadists” have killed 107 people inside the United States. Compare this with deaths occurring due to major crimes: 114 people were killed by far-right terrorism (consisting of anti-government, militia, white supremacist, and anti-abortion violence), 12 and nine people, respectively, killed in attacks “inspired by black separatist/nationalist ideology and ideological misogyny”. Attacks by people with Far-Left views have killed one person. It just goes to show that terrorism inside the United States is no longer the handiwork of foreign or “jihadi” ideologies, but is “homegrown”, the report points out.

The report points out a poor understanding of the terror threat and its roots by the Trump administration. A week into his presidency, Donald Trump issued an executive order banning entry of citizens of seven Muslim countries into the United States. The countries were: Iran, Iraq, Syria, Sudan, Libya, Yemen, and Somalia. Th order cited “national security” as the reason, but gave no real justification.

Trump’s aides tried to find some justification for the order claiming that in the administration’s assessment the United States was and will be the prime target of terrorist organisations from these countries. The same report clarifies how wrong this assessment was: “None of the deadly attackers since 9/11 emigrated or came from a family that emigrated from one of these countries nor were any of the 9/11 attackers from the listed countries. Nine of the lethal attackers were born American citizens. One of the attackers was in the United States on a non-immigrant visa as part of the U.S.-Saudi military training partnership.”

President Trump had to swallow his pride and gradually revoke his order. In early March of 2017, he revised the order excluding Iraq from the ban list. That September, he dropped Sudan too, but added North Korea, Venezuela and Chad.

In the last two decades since 9/11, there have been 16 “lethal jihadist terrorists in the United States”. Of them, “three are African-Americans, three are from families that hailed originally from Pakistan, one was born in Virginia to Palestinian immigrant parents, one was born in Kuwait to Palestinian-Jordanian parents, one was born in New York to a family from Afghanistan, two are white converts – one born in Texas, another in Florida, two came from Russia as youth, one emigrated from Egypt and conducted his attack a decade after coming to the United States, one emigrated from Uzbekistan and one was a Saudi Air Force officer in the United States for military training”. Nobody from the banned countries, nobody foreign citizens; all were American citizens.

What is more embarrassing for the Trump administration is the report saying: “When the data is extended to include individuals who conducted attacks inside the United States that were foiled or otherwise failed to kill anyone, there are only four cases that the travel ban could have applied to. However, in at least two of those cases, the individual entered the United States as a child. In a third case the individual had a history of mental illness and assault not related to jihadist terrorism. In a fifth, non-lethal attack Adam al-Sahli, who conducted a shooting at a military base in Corpus Christi on May 21, 2020, was born in Syria but was a citizen because his father was an American citizen and thus would not have been subject to the travel ban.”

The NewAmerica assessment, in contrast to the executive order, finds concrete evidence to suggest that the terror threat is “homegrown”. It gives the example of Mohammed Reza Taheri-Azar, “a naturalised citizen from Iran”, who on March 3, 2006 drove a car into a group of students at the University of North Carolina, injuring nine people. “Taheri-Azar, though born in Iran, came to the United States at the age of two” and “his radicalization was homegrown inside the United States”. On September 17, 2016 Dahir Adan, a naturalized citizen from Somalia, injured 10 people while wielding a knife at a mall in Minnesota. He too had come to the United States as a young child.

There are more such instances: “On November 28, 2016 Abdul Razak Ali Artan, an 18-year-old legal permanent resident who came to the United States as a refugee from Somalia in 2014 — having left Somalia for Pakistan in 2007 — injured eleven people when he rammed a car into his fellow students on the campus of Ohio State University…However, it is not clear that the attack provides support for Trump’s travel ban.

In Artan’s case, he left Somalia as a pre-teen, and “if he was radicalized abroad, it most likely occurred while in Pakistan”, which is not included on the travel ban. The report says the chances of him being radicalised inside the United States are more. This is based on the fact that “in a Facebook posting prior to his attack, he cited Anwar al-Awlaki, the Yemeni-American cleric born in the United States, whose work — which draws largely upon American culture and history — has helped radicalize a wide range of extremists in the United States including those born in the United States”.

There are several other pointers to the “homegrown” theory. For one, a “large proportion of jihadists in the United States since 9/11 have been converts”. There are “jihadists” who are non-Muslims. These facts “challenge visions of counterterrorism policy that rely on immigration restrictions or focus almost entirely on second generation immigrant populations”, the report says, debunking the Trump executive order.

The NewAmerica report debunks the assumption that only “hot headed” people are attracted to jihadist extremism. It finds that “participation in jihadist terrorism has appealed to individuals ranging from young teenagers to those in their advanced years (and) many of those involved have been married and even had kids – far from the stereotype of the lone, angry youngster”.

Women have broken the glass ceiling of jihadist terrorism as “more women have been accused of jihadist terrorism crimes in recent years” inside the United States.

The expansion of the social media world has played a singular role in radicalising American youth. “Many extremists today either maintain public social media profiles displaying jihadist rhetoric or imagery or have communicated online using encrypted messaging apps. The percentage of cases involving such online activity has increased over time.” Al Qaeda terrorists became key figures in this proliferation. They “fine-tuned the message and the distribution apparatus” and “put out extremist propaganda via websites and YouTube videos”.

America’s jihadists were never an immigration problem, the biggest jihadist terror threat U.S faces today is “homegrown”.

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