Counter Threat Finance for Strategic Competition
In strategic competition, malign state and non-state actor networks pose significant threats to key national security interests. To understand and combat these networks, counter threat finance, a tool historically used to address narcotics and terrorist financing, can be applied against state actors who use money to gain influence and increase power. Kevin D Stringer, Madison Urban and Andrew Mackay argue for expanding the authority and application of counter threat finance to address state adversaries, and highlight how this is an integral element of a nascent whole-of-nation economic statecraft strategy and an essential step towards gaining the edge in strategic competition.
Outside its community of practitioners, counter threat finance (CTF) is a little-understood national security instrument. However, as one author noted, ‘[f]inancing is the lifeblood of all organizations, and its interdiction or disruption can impair the ability of any entity to operate effectively’.Footnote1 Emerging from the counternarcotics and counterterrorism worlds, CTF has significant value and application in strategic competition against state adversaries, particularly China, Russia, Iran and North Korea. When integrated into a broader national security strategy and hybrid warfare campaign, CTF is an important tool that can be used to proactively shape contested environments, improve geopolitical and geoeconomic positions, and mitigate commercial and economic vulnerabilities from hybrid threats – a term used synonymously with irregular warfare activities. Finance is central to network operations, and CTF is a critical part of disrupting threat networks.
While the US and its partners primarily use CTF to target illicit non-state actors, it warrants greater adaptation to adversarial countries. In today’s global threat environment, CTF ought to be used against state adversaries that use both licit and illicit financial levers to shape, influence and control relevant populations, revenue streams, state and local governments, officials and supply chains. This article focuses on the US, and particularly the US Department of Defense (DoD) as a starting point, but future, planned research will consider the broader US interagency as well as allies’ and adversaries’ approaches to the topic – which is necessary to account for the various government siloes that confront threat finance. This article defines CTF, characterises its activities, situates it in the context of economic warfare, financial warfare, and anti-money laundering, and then offers a preliminary framework for its application against state actors. The conclusion proffers lines of study for further research as well as illustrates how CTF might best nest under a broader, whole-of-nation economic statecraft strategy.
