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House Homeland Security Committee Releases Report on ISIS Financing

October 14, 2016

This week, the United States House of Representatives Homeland Security Committee, chaired by Michael McCall (R-TX) released a report titled Cash to Chaos: Dismantling ISIS’ Financial Infrastructure. The report attempts to give an account of ISIS’ funding structures based on briefings, meetings with federal officials, press reports, and open source document analysis.

Much of the report focuses on ISIS’ major sources of funding from oil, black market commodities, nationalized industry, extortion rackets and kidnapping for ransom. However, the report also discusses the role of antiquities trafficking in ISIS’ funding and makes several recommendations in that regard.

While everyone can agree that countering ISIS’ financing is a key part of defeating the organization, effectively doing so requires accurate information in order to properly allocate resources. Unfortunately, with regards to its treatment of antiquities trafficking this report fails spectacularly in accurately assessing the problem.

For its information about antiquities trafficking, the report relies almost exclusively on reports from major media outlets such as the New York Times, Guardian, Wall Street Journal, and Washington Post. Unfortunately major media outlets have frequently been the purveyors of inaccurate information on this topic, and this has negatively impacted the report.

The report correctly identifies Lebanon, Turkey and Jordan as major transshipment points for antiquities smuggling. However, experts on the Syrian antiquities trade generally believe that much looted material either moves east rather than through closely monitored auction houses in London and New York, or that it is kept within the region in hopes of selling it in a few years when suspicions die down.

When it comes to estimating the value of antiquities looting to ISIS the report relies on outdated information, misrepresented statistics, and discredited figures. For example, the report states that:

Before the rise of ISIS, Syria’s antiquities and cultural heritage industry generated more than $6.5 billion annually and accounted for 12 percent of the country’s gross domestic product; thus, even if ISIS captured only a fraction of the market, it could have seen a windfall well into the tens of millions. [p.9]

The $6.5 billion figure comes from remarks made by State Department Assistant Secretary Anne Richard in 2013. It refers not to sales of antiquities but to the entire tourist industry of Syria, and was mentioned by Richard in the context of highlighting the importance of cultural heritage to postwar reconstruction. Since ISIS’ caliphate is a rather unattractive destination for foreign tourists, one can surmise that the fraction of this market captured by ISIS is zero.

Furthermore, the report goes on to say:

In one region in Syria, ISIS reportedly generated $36 million in revenue, partly attributed to its peddling of black-market antiquities. At one point, U.S. officials judged that ISIS was probably reaping over $100 million a year from such illicit trading. [p.9]

The often-repeated $36 million figure comes from Martin Chulov’s reporting in The Guardian. The figure has been widely questioned on this site and elsewhere. Chulov took his figure from captured documents shown to him by an Iraqi intelligence officer. It appears to show income from looting or ghanima, which in ISIS’ terminology means the expropriation of money and property from local populations. Looting of archaeological sites is classified as the extraction of al-rikaz or a “natural resources from the earth” akin to oil, gas, minerals and precious metals. Profits from digging are taxed at a 2o% to 50% rate, unlike ghanima which is expropriated wholesale.

The $100 million figure comes from a February 2015 report in the Wall Street Journal, citing “unnamed U.S. officials.” This is contradicted by figures provided by the US State Department, who estimated in September 2015 that ISIS “has probably earned several million dollars from antiquities sales since mid-2014.”

My own research based on available open source data concurs with this figure, estimating that ISIS has made a few million dollars from antiquities and that taxing looters accounts for less than one percent of the organization’s budget.

Unfortunately, the congressional staffers who wrote this report seem to have simply searched for reports published in major media outlets without critically examining them. Much of the media coverage of archaeological looting in Iraq and Syria has been drive by sensationalism. With reports like this there is a very serious danger that sensationalized articles and bogus figures could drive policy recommendations with regards to prosecuting the war against ISIS.

As it is, the report only makes modest recommendations with regards to policy. It argues that:

Domestic and international law enforcement agencies have not put high-enough priority on tracking black market sales of cultural artifacts and antiquities, which have become a significant source of terrorist revenue. [p. 4]

In response, the report recommends:

The Departments of State, Justice, and Homeland Security should, in coordination with INTERPOL and other relevant international organizations, as well as auction houses, spearhead a new initiative to crack down on illegal trade and trafficking in cultural property and antiquities in the United States and abroad. As part of this effort, various stakeholders should strengthen regulations that restrict the movement of artifacts smuggled out of warzones and take aggressive action to recover and return items to their respective countries of origin. The Committee is supportive of the approach taken in H.R. 2285 (Rep. William Keating [D-MA]), the “Prevent Trafficking in Cultural Property Act,” and urges the Senate to act on this bipartisan House-passed measure as soon as possible.

All of this is fairly common sense material, some of it partially accomplished earlier this year when Barack Obama signed a bill banning the importation or sale of archaeological material from Syria. The Prevent Trafficking in Cultural Property Act is mostly concerned with providing proper training to Customs and Border Protection in cultural property issues.

These are both worthwhile and commonsense efforts. The potential danger lies in if the publicity given to antiquities looting eventually causes a disproportionate amount of resources to be dedicated to stamping out this source of funding, which could better be used against larger sources of revenue. Nearly everyone can agree that the only long-term solution to the threat posed by ISIS is for the group to be defeated as rapidly as possible. We should then all hope for resources to be spent in the most optimal way to bring about this goal.

Article © Christopher Jones 2016.

3 Comments leave one →
  1. October 14, 2016 7:54 AM

    Thank you again for your efforts to set the record straight once again. It is indeed unfortunate that bad numbers continue to be recirculated to justify draconian legislation. See https://www.kirk.senate.gov/?p=press_release&id=1912. However, I would not blame it solely on poor research by overworked committee staff. Rather, the numbers appear to being fed to them by archaeological advocacy groups interested in shutting down all trade in cultural artifacts.

    One nit about the Syrian import restrictions. They don’t ban the sale of Syrian artifacts. Rather, they are an import ban directed at such artifacts that were illegally removed from Syria after the start of the Syrian civil war.

  2. C. Anzalone permalink
    October 14, 2016 4:32 PM

    A very interesting piece. One small note: I think you mean “ghanima/ghaneema,” which in Islamic legal terminology refers to spoils of war but which IS uses very liberally to also refer to properties seized from individuals it prosecutes and either imprisons or executes.

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  1. House Homeland Security Committee Releases Report on ISIS Financing — Gates of Nineveh: An Experiment in Blogging Assyriology | Talmidimblogging

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