27th May 2021

The Counter ISIS Finance Group Discusses MSBs

The Counter ISIS Finance Group (CIFG), which was established in 2015 and is one of five working groups of the Global Coalition to Defeat ISIS, convened virtually for its fourteenth meeting on May 17–18. The conference, which was jointly hosted by the US, Italy, and Saudi Arabia, brought together leaders from over 50 member states, observers, and independent experts to discuss ongoing efforts to disrupt ISIS revenue streams.

According to a joint statement issued by the group, the first day included a discussion of the terrorist group’s current financing methods — including its use of regional money services businesses (MSBs) to conduct international funds transfers — and efforts to counter those activities. This was followed by an announcement from the US, where it detailed targeted sanctions against a Turkey-based MSB, the Al-Fay Company, and two individuals associated with the MSB, Idris al-Fay and Ibrahim al-Fay. Another MSB operator, Alaa Khanfurah, was also designated.

The US Treasury’s Office of Foreign Assets Control (OFAC) says those sanctioned were assisting ISIS in transferring funds to Syria and Iraq.

More specifically, the US maintains that Idris al-Fay had been using the Al-Fay Company as an intermediary to distribute money for ISIS and facilitate transfers between ISIS and foreign donors. His brother, who managed the company in Idris’s absence, also routed international funds through currency exchanges and hawalas, with ISIS elements being the ultimate recipients. Separately, Alaa Khanfurah was designated for similar activity conducted through his own MSB.

Then, in conjunction with its announcement, the US urged CIFG member states to take complementary actions. It’s unclear whether CIFG member states will follow suit — and if they do, what form those actions will take.

Nevertheless, that ISIS and its supporters use MSBs to move funds and finance terrorist activities isn’t new. Indeed, MSBs are especially vulnerable to exploitation, given the nature of their business, which typically involves one-off or sporadic all-cash transactions. Yet the designations, against the backdrop of the CIFG’s meeting, do serve to highlight this ongoing threat, which is likely just as the US intended.

The second and last day of the meeting continued to discuss other terrorist financing threats, including ISIS’s exploitation of charitable organizations, its use of madrassa networks across South and Southeast Asia, and its use of other informal funds transfer strategies to support their activities.

The CIFG plans to re-convene in person later this year, although a date and details have not yet been confirmed.