Crowdfunding for Terrorism Financing

Paris, 31 October - Crowdfunding is a very useful way to reach a large audience to raise money for a charitable cause, to fund a start-up, or finance a creative project. Crowdfunding is a growing and evolving sector, with a significant international market. In 2022, there were over 6 million crowdfunding campaigns around the world. 

The vast majority of crowdfunding activity is legitimate, but events around the world have demonstrated that it can also be exploited for illegal purposes. This includes terrorists and terrorist groups who can exploit fundraising platforms and crowdfunding activities on social media to seek funding for their terrorist cause from a global audience.

The crowdfunding landscape is likely to evolve further, with the introduction of new payment technologies and the proliferation of online platforms supporting different types of crowdfunding activity. However, globally, there is insufficient understanding of the risks related to this sector, and because of this, regulation varies from country to country.

This FATF report analyses how terrorists misuse crowdfunding platforms. The report, which draws on experiences from the FATF Global Network, industry experts, academia and civil society examines the challenges faced in detecting and preventing terrorist financing through the crowdfunding ecosphere. Challenges include the complexity of crowdfunding operations, the use of anonymising techniques, and lack of training and terrorist financing expertise within the crowdfunding industry to detect suspicious activity.

The report highlights good practices, starting with the inclusion of crowdfunding in national terrorist financing risk assessments, outreach to the crowdfunding sector, and strong domestic and international information sharing mechanisms.