TNAG-2440-FCO40-3545-Visit-by-Alistair-Munro--Director--Terrorist-Finance-Unit-of-1992 — Page 24

CONFIDENTIAL

Scale and Nature of Terrorist Fundraising in Northern Ireland

1.

Racketeering has been a significant feature of life in Northern

Ireland since the early 1970's. It is orchestrated by terrorists,

and is the mainstay on which terrorist organisations, Republican and

Loyalist, rely to obtain the finance needed to carry out their

campaigns of violence. The intelligence agencies estimate that the

Provisional IRA (PIRA) raises over £8M annually from various sources

including members social clubs, frauds in the construction industry,

gaming machines, video piracy, taxis offering an alternative "bus"

service in Republican areas, and smuggling. In recent years PIRA

has increasingly attempted to "legitimise" its finances. The

finances of the other Republican terrorist groups are less well

organised than those of PIRA. There is less discipline amongst

loyalist terrorist groupings with the result that criminality with

the aim of personal gain has, until recently, underpinned

racketeering. There is a distinctive, heavy dependence on

extortion.

Large sums are involved but, unlike PIRA, loyalist

racketeering is not centrally managed.

Formation of the TFD

2. In September 1987 the then Secretary of State for Northern

Ireland decided that special measures were necessary to tackle the

growing problem of terrorist racketeering and 'legitimisation' of

terrorist finances. He established a multi disciplinary task force

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of financial experts the Terrorist Finance Unit (TFU)

recently named the Anti Racketeering Unit (ARU). It was

until

23/1597

CONFIDENTIAL

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