The U.S. government imposed sanctions on two French citizens in September for their ties to the Islamic State. One of them, Emilie Konig, who traveled to Syria in 2012 to fight for IS, "directed individuals in France to attack French government institutions." It is unknown whether Friday's Paris attacks are connected to this in any way. But even if there is a connection, traditional terror finance tools, such as designations, do little to counter this kind of attack.
The coordinated terrorist assault on Paris on Friday night appears to have been disturbingly inexpensive. Suicide belts, automatic weapons, and ammunition were the extent of the gear the eight-man team required. Beyond that, they probably only required food, communication, shelter, and travel. If anything, the most expensive aspect of the operation was incurred long ago: the indoctrination and military training. Remove that from the terrorism finance calculus, and the Paris operation likely cost under $250,000.
Urban warfare is a cheap and deadly form of terrorism. This has been made clear repeatedly in recent years. The 2008 Mumbai attacks carried out by Lashkar-e-Taiba, the 2013 Westgate Mall attack in Kenya carried out by al-Shabaab, and the 2015 attack on Western tourists in Tunisia by Islamic State supporters were all attacks that required various levels of training but minimal funding.
As the wealthiest terrorist group in history, IS would clearly not struggle to finance such an inexpensive attack. But it also would not be difficult for eight men – more if we include the others arrested in Belgium – to pool together enough cash as an independent cell, and to do so outside of the electronic banking system, where funds can be tracked.
If the U.S., France, and other Western allies are serious about disrupting IS financing, they will need to address the systemic challenges, including ongoing donations from deep-pocket donors in the Gulf, as well as the oil and antiquities trade across the Islamic State's borders. But even that may not be sufficient. The Islamic State raises most of its funds through racketeering and taxes. Land is therefore its most valuable resource. But to deprive the Islamic State of that likely requires new military strategies beyond the tactical bombing campaign that has been waged to date.
Jonathan Schanzer, a former terrorism finance analyst at the U.S. Department of the Treasury, is vice president for research at Foundation for Defense of Democracies.