1. Terrorists regularly adapt how and where they raise and move funds and other assets in order to circumvent safeguards that jurisdictions have put in place to detect and disrupt this activity. Identifying, assessing and understanding terrorist financing (TF) risk is an essential part of dismantling and disrupting terrorist networks [In October 2018, FATF completed work to identify good approaches and tools for disrupting terrorist financing activity based on specific examples provided by 33 jurisdictions from across the Global Network. FATF delegations have disseminated the relevant outcomes to competent authorities.]. An understanding of TF risk should also inform national counter terrorist financing (CFT) strategies and assists in the effective implementation of a risk-based approach (RBA) towards CFT measures.

2. Countries often face particular challenges in assessing TF risks due to the low value of funds or other assets used in many instances, and the wide variety of sectors misused for TF purposes. The cross-border nature of TF can pose additional challenges for identification of risk. Moreover, the operational needs for attacks can include routine transactional activity (e.g. car rental, purchasing a kitchen knife). Lower capacity jurisdictions often face further challenges due to a lack of TF expertise or personnel, and information gaps on unregulated or unsupervised activities.