ISIS' finances drying up but extremists still pose danger

Coalition destroying oil wells and tankers, shutting down group's financial networks

WASHINGTON • The Islamic State in Iraq and Syria (ISIS) starts the new year with a drastically depleted bank account, counterterrorism officials say, following months of intensified efforts to deprive the militants of oil profits and other revenue used to finance military operations and terrorists attacks abroad.

Coalition aircraft in the past 15 months have destroyed more than 1,200 tanker trucks - including 168 vehicles struck in a single air raid in Syria in early December - while also using new weapons and tactics to inflict lasting damage on the terrorists' remaining oilfields, US and Middle Eastern officials say.

The military strikes are being paired with new measures intended to shut down financial networks used by ISIS to procure supplies and pay its fighters, according to the officials. Two weeks ago, the US and Iraqi governments announced the first coordinated effort to punish Iraqi and Syrian financial services companies used by the terrorists to conduct business.

The campaign has slashed profits from oil sales, traditionally the biggest revenue source for ISIS, US officials say, and deepened the economic pain for a terrorist organisation that until recently was regarded as the world's wealthiest.

One sign of the financial strain, the officials say, is a shrinking payroll: After cutting salaries by half a few months ago, ISIS now appears to be struggling to pay its workers and fighters.

KNEECAPPING

We are destroying ISIL's economic base. Their fighters are not getting paid.

MR BRETT MCGURK, US special envoy to the 67-nation coalition against ISIS, also known as ISIL, which stands for Islamic State in Iraq and the Levant.

"We are destroying ISIL's economic base," Mr Brett McGurk, the US administration's special envoy to the 67-nation coalition arrayed against ISIS, said at a news briefing recently, using one of the common acronyms for the militants.

Just a year ago, the militants were luring foreign fighters with promises of generous pay cheques, but today "that is not happening", he added. "Their fighters are not getting paid, and we have multiple indications of that."

Coalition planes have been bombing the group's oilfields and tanker fleet for more than two years, but the most notable successes in recent months have come from military operations that targeted individual oil wells, including well casings and other underground infrastructure, according to US and Middle Eastern officials familiar with the new strategy.

The tactics make it all but impossible for ISIS to repair the wells or extract oil through makeshift techniques, the officials said.

A more challenging target for American and Iraqi officials has been the network of small, loosely regulated exchange houses traditionally used by Iraqis and Syrians to wire funds and exchange local dinars for Western currency.

US Treasury officials have been working with their Iraqi counterparts for more than a year to identify and shut down key exchange houses used by ISIS to make purchases, collect oil receipts and pay its fighters and employees.

Keeping up the pressure on the extremist group's financial networks is particularly critical at a time when ISIS is suffering military defeats and territorial losses in Iraq and Syria, according to counterterrorism officials.

Even in a depleted condition, the militants' financial assets are judged to be more than sufficient for carrying out terrorist operations abroad. Indeed, ISIS' signature terrorist strikes - including the attacks in Paris on Nov 13, 2015, that killed 130 people - are believed to have cost no more than a few thousand dollars each.

Separately, ISIS yesterday claimed responsibility for twin blasts that tore through a central Baghdad market last Saturday that left at least 27 people dead and more than 50 wounded.

The terrorist group also claimed another bombing yesterday at a police checkpoint in southern Iraq that killed at least seven people, officials said.

Gunmen wearing suicide vests and driving an explosives-laden vehicle opened fire on the checkpoint near the town of Qadisiyah, which lies around 180km south of Baghdad. "The security forces fought back, killing the attackers and blowing up the car," an Interior Ministry statement said.

WASHINGTON POST, REUTERS, AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on January 02, 2017, with the headline 'ISIS' finances drying up but extremists still pose danger'. Print Edition | Subscribe