The U.S. government's effort to counter the Islamic State in Iraq and Syria (ISIS) is focused on "five mutually reinforcing lines of effort," one of which aims to stop ISIS's financing and funding. That may prove a difficult task, in large part due to the differences between the funding models employed by ISIS and al-Nusra Front (ANF) or other al Qaeda affiliates, but not one that is beyond the international community's capabilities.

Combating ISIS financing is an important component of the international campaign against the only group to be even too extreme for al Qaeda. Counter-terror finance tools have proven uniquely effective both as a means to stem the flow of funds to terrorist groups and as sources of actionable financial intelligence that can then be leveraged to even greater success. There is no doubt that in those areas where ISIS financing crosses international borders or leverages the international financial system (especially the formal financial sector, banks, but even alternative financial transfer mechanisms), the traditional toolsets developed in the years since 9/11 will continue to prove to be effective means of countering ISIS financing. This includes ISIS's income from illicit oil smuggling, donations from deep-pocket donors in the Gulf and elsewhere, kidnap-for-ransom payments, efforts to access the antiquities black market to sell looted ancient artifacts, and more.

But this is unlikely to be enough to fully "dismantle" ISIS. Unlike al Qaeda and other groups, ISIS — which used to call itself as al Qaeda in Iraq (AQI) and has now renamed itself the Islamic State and unilaterally declared the establishment of an Islamic caliphate — was financially self-sufficient for about eight years as a terrorist and insurgent group before committing itself to running a proto-state. And unlike other groups, which are reliant on state sponsors, major donors or abuse of charity, AQI was financially independent by virtue of engaging in tremendously successful criminal activity enterprises domestically within Iraq.

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Today, ISIS financing revenue comes primarily from the sale of illicit oil, from kidnappings for ransom, from the deep pockets of a small number of major donors and from a wide array of criminal enterprises such as extortion, looting antiquities and stealing livestock. The Department of the Treasury estimates that ISIS brings in several million dollars a week from oil sales, down from $2 to 3 million a day at its heyday. Kidnapping ransoms have yielded at least $20 million so far this year, wealthy donors have provided a few million more a year, while extortion rackets raised several million dollars each month.

It is true that ISIS criminal enterprises within Iraq are currently beyond the reach of traditional law enforcement and regulatory action. But even so, focusing on those areas that are vulnerable to current toolsets will effectively deny ISIS the money it needs to hold and administer its Islamic State. Meanwhile, while military tools would under other circumstances be the last thing one might think of as a logical means of combating crime, the fact is that airstrikes against ISIS have already significantly undermined some of the group's criminal enterprises and further strikes should continue that trend.

And, while the prospects of real political reform in Iraq seem bleak today, should the Iraqi government at some point reprioritize governance and the rule of law over sectarianism and corruption, then perhaps local Iraqi law enforcement could — at some future point — investigate and prosecute ISIS criminal enterprises as the domestic criminal activities they are.

The Treasury Department's ISIS strategy focuses on imposing financial sanctions on anyone who trades in ISIS's stolen oil, inducing our foreign partners to put an end to kidnap-for-ransom payments, targeting external donor networks for sanctions, restricting ISIS's access to the international financial system, and employing targeted sanctions against ISIS's leadership and facilitators. This is a wise place to start — leveraging the tools Treasury currently has in its toolkit — but what's next?

Looking forward, expect Treasury and its interagency and international partners to tweak existing tools and develop new ones as they adapt to the evolving illicit financial threat that is ISIS. This is something Treasury does well, thinking outside the box to develop the strategies needed to deal with tomorrow's threats. Treasury's Terrorism and Financial Intelligence branch did just that to address al Qaeda financing after 9/11; it did so in an even more substantial way in 2005-2006 when it developed tools and strategies to contend with Iran's illicit financial conduct, support for terrorism, and nuclear proliferation; and it did so once more when it created the Iraq Threat Finance Cell (ITFC) to analyze financial pocket litter and intelligence collected in counterinsurgency raids and used that new information as targeting data feeding the next round of raids.

To be sure, there is no silver bullet to disrupt ISIS financing, let alone to ultimately defeat the organization. ISIS presents a unique set of circumstances, which is sure to lead to new rounds of counter-terror finance innovation in response. So, since ISIS currently does not rely heavily on external donors, there have only been a total of four ISIS-related Treasury designations to date (only two of which targeted financiers). Moving forward, expect to see Treasury instead leverage intelligence to target the middlemen, traders, transport companies and anyone else to helps produce, refine, transport or sell ISIS oil. At the same time, expect continued vigilance targeting major donors in the Gulf, not only because they remain major sources of revenue for other groups like ANF, but because continued success targeting oil and other revenue will likely force ISIS moneymen to turn to deep-pocketed donors to make up the difference.

In the meantime, there is circumstantial evidence that Treasury's full-court press approach against ISIS is already working far away from Iraq's borders. Consider the case of a jihadist on trial in Germany for joining a group in Syria allied to ISIS who struggled to send funds to the Middle East, largely because of measures Treasury and others have already put in place. Court proceedings and "local media reports," according to The Telegraph, "painted a picture of jihadists forced to send a member to Europe for supplies because it had become too hard for them to transfer money without being traced." But that's not all: When some group members sent funds around the world via Western Union, others were afraid to pick up the money for fear that the wire transfers were being monitored. Meanwhile, while ISIS's big money comes from oil sales, we are seeing success there too: ISIS oil revenue has already reportedly been curbed by some two-thirds from about $3 to $1 million a day.

Criminal enterprise still accounts for significant ISIS revenue today, complementing the group's other lucrative sources of income, and Treasury tools are not well-suited to this particular task. But on its own, criminal enterprise is an insufficient source for funding for a group committed not just to terrorist and insurgent activity but to capturing, holding and administering territory, which involves significant expenditures and therefore requires more significant revenue streams.

So, by focusing now on ISIS's income from oil, kidnaping for ransom and major donors, and coupling that with expanded efforts to deny the group the ability to store, transfer or access money in the international financial system, Treasury could severely undercut ISIS funding streams. That may not destroy ISIS, the terrorist and insurgent group, but it certainly could undermine the Islamic proto-State.

A portion of this piece was included in Levitt's Nov. 13 testimony before the House Financial Services Committee.

Levitt is the Fromer-Wexler Fellow and director of the Stein Program on Counterterrorism and Intelligence at the Washington Institute for Near East Policy. Follow him @Levitt_Matt.