Patrick McHenryChairman

Washington, March 20, 2018 -

The Subcommittee on Terrorism and Illicit Finance met today to examine transnational criminal organizations (TCOs) and their relationship to terrorist organizations, the international economy, and the US national defense.

“Transnational criminal organizations operate on a global scale, crossing international boundaries to further their pursuit of power, influence, and profits. TCO’s are able to access global supply chains across the land, sea, air, and cyber domains to move goods, people, services, money, and data,” said Subcommittee Chairman Steve Pearce (R-NM). “The massive profits also ensure that these criminal groups are powerful enough to influence the political, judicial, and law enforcement branches of more vulnerable countries, providing them the protection to continue their illegal schemes and further expand their influence. Today’s hearing was an opportunity to dissect the connection of transnational terrorism, crime, and corruption. I thank everyone for joining the Subcommittee to examine the nexus of terrorism, drug trafficking, and organized crime to better understand how powerful criminal organizations exploit the financial system for their illicit gain.”

Key Takeaways

• The diversified illicit activities underpinning TCOs are wreaking havoc on the international economy.

• Terrorists are increasingly turning to TCOs to gain logistical and financial support for their activities in unstable regions of the world.

• The U.S. government should institute a national strategy for combating the financing of TCOs to inform and supplement other policy tools aimed at dismantling transnational organized crime.

Topline Quotes from Witnesses

“The convergence of threat networks contributes significantly to the deterioration of the fabric of society and the state. As [tco] grows, so does terror finance, and ultimately the state either becomes complicit in illicit activity or weakens to the point of ineffectiveness. The crime-terror convergence must be considered a tier-one national security priority for both the United States and our global partners. Synchronizing our anti-terrorism legal frameworks and enhancing our Counter Threat Finance (CTF) collaboration with trusted partners and allies strengthens the ‘friendly network’ needed to combat the crime-terror convergence.” – Joseph Humire, Executive Director, Center for a Secure Free Society

“The threats to this great country are moving at lightning speed and we need a sense of urgency at this point. There is an old saying that, "opportunities come and go". Well, even though in my view we lost a golden opportunity during Project Cassandra and other investigations, I know our work force is resilient and can get right back on track with leadership and direction. It makes no sense to dwell on the past and play the blame game, but rather fix the issues and move forward to protect the citizens of the United States of America.” – Derek Maltz, Executive Director, Government Relations, Pen-Link, Ltd.

“Over the past 15 years, the U.S. has increased efforts to detect the financing of terrorism and crime, impose economic sanctions, and raised awareness among the private and civic sectors about how bad actors can exploit the international financial system to fund their networks and deadly operations. The new National Security Strategy, E.O. 13773 to counter transnational organized crime, and economic sanctions against Iran, North Korea, and Venezuela demonstrate how financial and economic measures can enhance U.S. security and prosperity. As these illicit networks evolve, we must constantly update our modes of detecting, disrupting, dismantling and deterring our adversaries with the financial instrument of national power. Only through proactive interagency coordination, public-private partnerships, and international cooperation can we effectively counter terrorism, crime and corruption around the world.” – Celina B. Realuyo, Professor, Practice of National Security Affairs, William J. Perry Center for Hemispheric Defense Studies, National Defense University