Exploring the shadowy world of terrorist financing.

• Position: SECURITY BEAT: Homeland Defense Briefs

The number of convictions for financing terrorist activities worldwide can be counted on one hand, a leading authority on the subject claimed.

Rooting out such activities is like finding the proverbial needle in a haystack, "but the field is full of haystacks," said Cliff Knuckey, former chief of Scotland Yard's anti-money laundering unit, who now consults for RISC Global, a London-based security firm.

Money laundering is the process for turning bad money into good money, while terrorist financing is often the process of turning good money to bad, he said.

Terrorist financing has been going on in one form or another since World War II, but received little attention until 9/11, he said at the GovSec conference.

Terrorists are constantly changing their tactics for raising money, Knuckey said. The top down distribution of funds, as practiced by the wealthy Osama bin Laden, is largely a thing of the past. Individual cells are raising their own funds. And it doesn't cost much. The Madrid bombings in 2004 cost the perpetrators about $2,000. The London bombings last year cost about $1,000, Knuckey said.

New tactics for raising funds include cooking the books at legitimate businesses, such as Halal butchers in Europe, to funnel money to cells...