Stolen real estate – like blood diamonds – funds deadly conflicts
The use of conflict resources to finance wars is spreading to new products, with far more serious consequences.
One example is the successful trafficking of conflict diamonds – colloquially known as blood diamonds – which has led to the use of other landscape-based resources to fund armed conflict. War timber, oil, minerals and wildlife now also contribute to the financing of war, with innovation underway.
A new form of conflict resource is real estate – farms, houses, apartment buildings, villages, towns and cities in any country. And my research has shown that the trafficking of this commodity has a much greater impact on civilian populations, the ability to wage war, peacemaking and peacebuilding.
Different from mobile conflict goods like timber, real estate includes real estate assets that are not themselves extractable – but the rights to them are. The theft of these rights – by force, law, threat, deception, forced or forced sale – in war zones can generate the revenue needed to fund armed conflict.
While overall estimates of funding obtained through real estate theft and trafficking have yet to be made because we didn’t know what to look for until recently, there are clues as to how it works.
The real estate windfall
In Nineveh, Iraq, 26 real estate records seized by ISIS from a real estate office contained deeds worth around US$90 million worth of real estate, with ISIS beginning to resell one of them left before his defeat.
Separately, ISIS’s income from renting 8,000 confiscated public buildings in Mosul alone amounted to $15 million a year. And although this sum is only the second one stolen from the central bank of Mosul in 2014, it is not a one-time gain in financing the way the stolen money is, because the rent accumulates each year.
In Idlib, Syria, the Islamist group Hay’at Tahrir al-Sham confiscated homes belonging to Christians, generating US$70,000 in annual rent in 2019.
During the Colombian war of the FARC (Fuerzas Armadas Revolucionarias de Colombia), the trafficking of land rights to finance the activities of the militias involved the illegal transaction of four to six million hectares of land stolen from small farmers. And in Sudan, the government paid the Janjawid militia in real estate by allowing them to keep the land they attacked.
My research is part of ongoing examinations of the many ways real estate is tampered with in war zones. The trafficking involves national and international companies; political and business interests; individual speculators, fighters and local leaders; and local and regional clans, lineages, tribes and sects.
Much more threatening
Real estate traffic is an alarming trend because it has different characteristics that make it much more threatening than other properties.
For diamonds or timber, the cash value is only realized once as the commodity leaves the conflict area with the buyer.
For real estate, however, properties used to fund one side in a conflict can be stolen and sold to fund the other side as territory is won and lost in a war. Trafficked rural land can also generate additional income through the cultivation of illegal crops, speculation and rental.
It is also common in war zones to fraudulently sell the same property to multiple buyers without their knowledge. This is not possible with most conflict products because a buyer takes physical possession of the product the moment it is purchased.
In addition, real estate does not need to be converted into cash to support wartime activities due to its high value in paying combatants, as a reward, recruiting tool, inducement and punishment for people. and groups.
Recruits and fighters are given houses and farms in return for joining an armed group and serving in combat, and local leaders are given real estate to incentivize their loyalty to armed groups. At the same time, real estate can be expropriated from anyone whom an armed group seeks to punish.
Trafficked real estate can also increase in value by being repurposed by an armed group – such as houses and shops can be built on otherwise vacant land which can then be sold. This happened in the Colombian and Syrian conflict zones.
Real estate is not geographically remote, limited in quantity, or difficult to locate. It does not depend on laborious or expensive extraction methods nor does it require specific means of transport and complicated payment methods by external agents.
Armed real estate
Real estate trafficking also has very real wartime military uses, such as confiscating the real estate documents of those who fled the Syrian war. These confiscated documents – registers, deeds, titles and legal archives – are then used to locate opposition areas to then attack and engage in political and ethnic cleansing.
The extraction and sale of minerals or timber can certainly have post-conflict repercussions in terms of resources that are no longer available for development. But their sale does not generate a permanent dislocation of the population, deep grievances and land conflicts within civil society as real estate trafficking does. These long-term impacts pose the real risk of reigniting a war.
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Real estate also provides self-sufficiency in financing, a top priority for armed groups, as it frees them from outside influence, a feature of selling other products mainly to foreign buyers.
Indeed, when it comes to real estate traffic, the buyers are usually residents of the war zone.
For these reasons, there is great concern that such a funding model will be particularly beneficial to terrorist groups.
Nevertheless, there are some encouraging signs. Ongoing research on real estate as a product of conflict suggests that countermeasures initiatives can be implemented in much the same way as those that have successfully thwarted much of the trafficking in diamonds, timber and minerals.
These may include different forms of detection using financial tracking and the use of local knowledge, the use of existing countermeasures for war crimes and human rights violations and the expansion of countermeasures. measures that some local communities employ.