Iraqi laborers work at the Rumaila oil refinery in Zubair near the city of Basra, Iraq, in a 2009 file photo.

Iraqi laborers work at the Rumaila oil refinery in Zubair near the city of Basra, Iraq, in a 2009 file photo. AP Photo/Nabil al-Jurani, File

The United Nations Must Clamp Down on ISIS Oil Profits

With little power to stop Islamic State administrators from taxing subjugated populations, the world community must focus on limiting petrochemical revenues.

If there is one element in the Syrian civil war that Presidents Barack Obama and Vladimir Putin agree on, it is the need to deprive the Islamic State of money. The group, by far the richest terrorist organization on the planet, is estimated to hold at least $2 billion — half of which it plundered from Mosul banks last year. U.S. Treasury Department officials say ISIL makes another $500 million annually from smuggling oil. Combined with the sale of cultural artifacts and antiquities and taxing its subjected people, the organization pulls in over a billion dollars annually.

Common sense says this money will go to finance attacks in Europe; consolidate its presence in Syria and Iraq by buying off potential adversaries; increase its rank-and-file through relatively high payments; and complicate the efforts of Syrian rebel groups to prevent defections.

But what can the United States and its allies and partners do about it?

Even before Operation Inherent Resolve began in August 2014, the Obama administration was well on its way to clamping down on ISIL by designating it a terrorist organization ineligible to move money through the international financial system. But the U.S. can only do so much. This is why the U.N. Security Council, under China’s presidency during February, held a special session to clamp down on the financial industries, crude oil smuggling, banking, and donations that have kept the Islamic State alive and kicking. That meeting quickly culminated in a unanimous UNSC resolution on ISIL’s financing. Neither Moscow nor Washington, however, are satisfied with the effort. Oil continues to be smuggled across state lines and sold to the Assad regime in an arrangement that has benefited both sides in the Syrian civil war.

U.S. and Russian officials are now negotiating a new resolution that will be presented to the full council membership on Dec. 17. “Cutting ISIL off from the international financial system and disrupting its financing are critical to effectively combatting this violent terrorist group,” U.S. Treasury Secretary Jacob Lew said in a press release announcing the upcoming meeting. “A united international front is vital to achieve that goal, and this meeting marks an important step in coordinating our efforts.”

Although the resolution is still being drafted, it’s safe to assume that the text will include extensive reporting requirements to the Security Council from the U.N. Counterterrorism Committee, member states, and the Secretary General on implementation and determinations on whether any state is struggling or refusing to cooperate with its provisions. Unfortuntately, the international community ultimately has little power to stop these kinds of practices. Unlike the old Al-Qaeda under the stewardship of Osama bin Laden, the Islamic State is not dependent on wealthy donors from the Persian Gulf opening up their wallets and sending money across state lines, where counter-financing measures like sanctions on specific banks would be effective in slowing down. The Islamic Stateis a self-sustaining money machine with an extensive system of taxation, monetary fees and penalties, and extortion within the territory it controls combines to form the most important financial lifeline for the organization.. Absent a full-fledged, coordinated ground offensive in Syria and Iraq, where the objective is clearing and holding the territory that ISIL currently administers as its caliphate, those taxes and fees will continue to line its coffers.

In short: the U.N. system simply doesn’t have the authority to compel ISIL to cease taxing or fining the people it subjects. But it can dent its oil revenues by barring limiting the routes that smugglers use to transport the oil to Turkey and the Kurdish regions and deter U.N. member states from importing the oil that is produced.

And the Security Council can authorize the U.N.’s various counterterrorism committees to monitor activity in member states bordering Syria to ensure that, at the very least, ISIL’s oil trade is contained to one country.

The reporting requirements in the February resolution are relatively lax and focus more on best practices and U.N. procedure. Instead of simply requiring member states to update the U.N. on what actions they are taking to implement the resolution, any draft resolution considered next week must enact an accountability mechanism. If states or their nationals are participating in any way with purchasing or transporting the crude oil that ISIL produces — and if there is reasonable, articulable evidence to this effect — the committee responsible for monitoring should disclose that information to the Security Council and recommend penalties if the violations continue into the future.

Last but not least, the U.N. Security Council should include a provision in any resolution that “calls upon” the Turkish Government to devote more staff and electronic surveillance to guard its 500-mile border with Syria, including the 60 miles of border that remain open to ISIL oil exports. The U.N. Counterterrorism Committee should be encouraged to report to the Security Council as to Turkey’s behavior on this front, with the possibility of more stringent measures being debated in the future if the Syria-Turkey border remains a hindrance to the counter-ISIL effort.

Any unified effort from the international community should be welcomed, and the Dec. 17 meeting in New York certainly won’t hurt the war effort. Yet we must be cognizant of reality: the Security Council doesn’t have a lot of leverage over the situation. What leverage the body does have must be maximized to the greatest possible extent.