ISIS Still Flush with Up to $300M Cash as Loss of Caliphate Reduces Operational Expenses

ISIS has "transformed into a covert network," including in Iraq and Syria, and "remains a threat as a global organization with centralized leadership," the United National Security Council was told in a new report today.

"This threat is increased by returning, relocating or released foreign terrorist fighters," adds the report prepared by the Counter-Terrorism Committee Executive Directorate and the Analytical Support and Sanctions Monitoring Team along with the Office of Counter-Terrorism, other United Nations entities and international organizations.

The report notes that remaining ISIS senior leaders are trying to juggle "a number of essential tasks... such as finance, logistics, military, intelligence, security, doctrine and media."

ISIS has "substantially evolved into a covert network in Iraq, where it prioritizes local operations. It is in a phase of transition, adaptation and consolidation. It is organizing cells at the provincial level, replicating the key leadership functions. Provincial networks are expected to develop financial self-sufficiency, although limited funding is still disbursed from the centre."

"The network in Iraq is receiving some reinforcement via a net flow of ISIL fighters from the Syrian Arab Republic. The Syrian network is expected by some Member States to evolve in its turn to resemble that in Iraq."

One document, obtained by an unnamed member state, cited in the report describes ISIS objectives for the post-caliphate period: "to undermine stabilization and reconstruction activities, target infrastructure rebuilding efforts and in general thwart economic progress."

Globally, "member States remain concerned at the continued explicit intent of ISIL leadership to generate attacks, and the haphazard nature of inspired attacks, which makes defending against them difficult," the report continues.

"The fall in international attacks and plots has also been caused by attrition of key ISIL personnel. Damage to the ISIL brand may be another way in which its progressive military defeat has reduced its capacity to project an international threat," it said. "Nevertheless, ISIL remains by far the most ambitious international terrorist group, and the one most likely to conduct a large-scale, complex attack in the near future. It retains an interest in attacking aviation and in the use of chemical, biological, radiological and nuclear materials."

If ISIS "regains access to permissive space and reinvests in external operational planning, a resurgence of directed attacks should be anticipated," and the threat of foreign terrorist fighters leaving the conflict zone -- particularly their dependents -- "is particularly challenging -- radicalized women and traumatized minors may also pose a serious threat."

The terror group is believed to still have access to financial reserves of between $50 million and $300 million -- and with the fall of the caliphate, ISIS has fewer operational expenses to sap their cash.

Some of that cash has been smuggled outside of Iraq and Syria, and some of it is believed to be invested in legitimate businesses. The report notes that the terror group's "financial assets have largely been concealed, with a strategic view to funding larger-scale attacks once the opportunity arises again."

ISIS cells around the globe, though, aren't dependent upon HQ for funding and raise their own cash through various criminal activities including kidnapping for ransom and extortion.

"There are reports that the group retains intelligence on local communities that could be used in future efforts to extort or otherwise extract financing from areas previously under its control," the report adds, while ISIS "is assessed to retain financial and information technology expertise that can be exploited to advance the group’s aims."

"Unregistered money-service businesses remain the primary means of transferring funds by ISIL, while gold exchanges are also reported to be a source of illicit financial flows to the group."