While actual terrorist operations require only  comparatively modest funding, international terrorist groups need  significant amounts of money to organize, recruit, train, and equip new  adherents and to otherwise support their activities. U.S. Efforts to Combat Terrorist Financing Abroad Include a Number of Interdependent Activities

U.S. government agencies participate in a number of interdependent efforts  to address the transnational challenges posed by terrorist financing,  including terrorist designations, intelligence and law enforcement,  international standard setting, and training and technical assistance. The effort does not have key  stakeholder buy-in on roles and practices, a strategic alignment of  resources with needs, or a process to measure and improve performance. U.S. Effort Does Not Strategically Align Resources with Need

The U.S. government does not strategically align its resources with its  mission to deliver counter-terrorism financing training and technical  assistance. Treasury Faces Two Accountability Issues Related to Its Terrorist Asset Blocking Efforts

Treasury faces two accountability issues related to its terrorist asset  blocking efforts. First, Treasury’s OFAC reports on the nature and extent of  terrorists’ U.S. assets do not provide Congress the ability to assess OFAC’s  achievements. Second, Treasury lacks meaningful performance measures  to assess its terrorist designation and asset blocking efforts. OFAC officials  said they have initiated efforts to develop an OFAC-specific strategic plan  and performance measures. Objectives, Scope, and Methodology

Chairman of the Senate Caucus on International Narcotics Control, Charles  E. Grassley; Senator Richard J. Durbin; and Chairman of the Senate  Committee on Homeland Security and Governmental Affairs, Senator  Susan M. Collins, asked us to (1) provide an overview of U.S. government  efforts to combat terrorist financing abroad and (2) examine U.S.  government efforts to coordinate the delivery of training and technical  assistance to vulnerable countries. In addition, they requested that we  examine specific accountability issues the Department of the Treasury  (Treasury) faces in its efforts to block terrorists’ assets held under U.S.  jurisdiction. We assessed documentation and interviewed officials from:  the Department of Homeland Security (Immigration and Customs   the Department of Justice (Criminal Division’s Asset Forfeiture and  Money Laundering Section, Counter Terrorism Section, and Office of  Overseas Prosecutorial Development, Assistance and Training; Federal  Bureau of Investigation);  the Department of State (Bureau for International Narcotics and Law  Enforcement Affairs, Office of the Coordinator for Counter-terrorism,  Bureau of International Organizations, U.S. Mission to the United  Nations, U.S. Agency for International Development; three U.S.  embassies abroad)  the Department of the Treasury (Office of Technical Assistance, Office  of Foreign Assets Control, Financial Crimes Enforcement Network, the  Executive Office for Terrorist Financing and Financial Crime, IRS’s  Criminal Investigation Division);  the Financial Action Task Force on Money Laundering (FATF);  International financial institutions including the International Monetary  Fund (IMF), World Bank, Asian Development Bank (ADB); and Inter- American Development Bank;     the United Nations (UN), including the Counter Terrorism Committee  and relevant UN Security Council resolutions sanctions committees and  monitoring mechanisms; and  the Organization of American States. Our report concludes that the  U.S. government lacks an integrated strategy to coordinate the delivery  of training and technical assistance because key stakeholders do not  agree on roles and practices, there is not a clear presentation of what  funding is available for counter-terrorism financing training and  technical assistance, and a system has not been established to measure  performance and incorporate this information into its planning efforts. The report, as mandated, was intended to  provide only a snapshot view in time of terrorist assets held in the United States by  terrorist countries and organizations.’” “Substitute  with the following language: ‘OFAC officials have advised that OFAC’s  new performance measures are expected to be completed by December 1, 2005, and its  new strategic plan is expected to be completed by January 1, 2006.’” “In the second paragraph, the following language: “We also recommend that the Secretary of  Treasury provide more complete information on the nature and extent of asset blocking in  the United States in its Terrorist Assets Report to Congress and establish milestones for  developing meaningful performance measures on terrorist designations and asset blocking  activities…..”  Should be replaced with the following language:  .
Why GAO Did This Study

Terrorist groups need significant amounts of money to organize, recruit, train, and equip adherents. U.S. disruption of terrorist financing can raise the costs and risks and impede their success. This report (1) provides an overview of U.S. government efforts to combat terrorist financing abroad and (2) examines U.S. government efforts to coordinate training and technical assistance. We also examined specific accountability issues the Department of the Treasury faces in its efforts to block terrorists' assets held under U.S. jurisdiction.

What GAO Found

U.S. efforts to combat terrorist financing abroad include a number of interdependent activities--terrorist designations, intelligence and law enforcement, standard setting, and training and technical assistance. First, the U.S. government designates terrorists and blocks their assets and financial transactions and supports similar efforts of other countries. Second, intelligence and law enforcement efforts include operations, investigations, and exchanging information and evidence with foreign counterparts. Third, U.S. agencies work through the United Nations and the Financial Action Task Force on Money Laundering to help set international standards to counter terrorist financing. Fourth, the U.S. government provides training and technical assistance directly to vulnerable countries and works with its allies to leverage resources. The U.S. government lacks an integrated strategy to coordinate the delivery of counter-terrorism financing training and technical assistance to countries vulnerable to terrorist financing. Specifically, the effort does not have key stakeholder acceptance of roles and procedures, a strategic alignment of resources with needs, or a process to measure performance. First, the Department of Treasury does not accept the Department of State leadership or the State-led Terrorist Financing Working Group's (TFWG) procedures for the delivery of training and technical assistance abroad. While supportive of the Department of State's role as coordinator of TFWG efforts, the Department of Justice officials confirmed that roles and procedures were a matter of disagreement. Second, the U.S. government does not have a clear presentation and objective assessment of its resources and has not strategically aligned them with its needs for counter-terrorist financing training and technical assistance. Third, the U.S. government, including TFWG, lacks a system for measuring performance and incorporating results into its planning efforts. The Treasury faces two accountability issues related to its terrorist asset blocking efforts. First, Treasury's Office of Foreign Assets Control (OFAC) reports on the nature and extent of terrorists' U.S. assets do not provide Congress the ability to assess OFAC's achievements. Second, Treasury lacks meaningful performance measures to assess its terrorist designation and asset blocking efforts. OFAC is in the process of developing more meaningful performance measures aided by its early efforts to develop an OFAC-specific strategic plan. Officials stated that OFAC's new performance measures will be completed by December 1, 2005, and its strategic plan will be completed by January 1, 2006; however, they did not provide us with documentation of milestones or completion dates.