IRBIL, Iraq — Muhammed Jamal can understand why many want to join ISIS.
"You get paid the most, you have the most weapons, you are with the most powerful group," said Jamal, who as a Sunni Iraqi would have little trouble joining up with the group. ISIS has openly welcomed Sunni Muslims into its self-declared "Islamic State," stretching 12,000 square miles through Syria and Iraq. "I'm not a fighter, but if I was that is who I'd join."
Jamal fled Mosul, Iraq's second biggest city, when ISIS militants captured it in early June. "I left Mosul when ISIS came because I thought it would be bombings and war there and I wanted to protect my family," said Jamal, 31, who is now sheltering with several other Sunni families near the Kurdish city of Irbil. "But now I do think about going back. I don't agree with their position on religion, but if they have money and can give us jobs … that would be more than anyone else has given us in years."
At nearly $400 a month, ISIS pays its fighters nearly double what other groups in the region pay — from the moderate Free Syrian Army, to militant group Hezbollah, to even the Iraqi army — according to intelligence groups.
ISIS has grown from being a small offshoot of al-Qaeda in Iraq into the wealthiest terror group in the world, with revenue streams that have grown and matured as the organization has expanded its reach. Once reliant on handouts from wealthy donors in the Gulf, it is now believed to be wholly self-sufficient, garnering millions by trading in crude oil, selling artifacts on the black market, and running racketeering and kidnapping schemes. It is believed to have built itself a total wealth of over $2 billion — far beyond what any terror group before it has managed to muster. Western intelligence agencies, once focused on donors and looted cash from Iraq banks, now believe that ISIS has created a model that will ensure that the group can remain self-sustaining billionaires. Its wealth, say experts, is almost entirely produced locally, and therefore not as vulnerable to outside influence or sanctions.
"They did not get like this by accident," said Luay al-Khateeb, a visiting fellow at the Brookings Institution's Doha Center in Qatar and director of the Iraq Energy Institute. ISIS looked at other groups — al-Qaeda strategy of levying local taxes, Boko Haram in Nigeria's use of local resources, and FARC in Colombia's kidnapping of wealthy locals and foreigners — and then tried to perfect it.
"This is a process that began decades ago and has been honed to turn ISIS into a profitable enterprise," al-Khateeb said.
Oil refineries begin to dot the horizon just a few miles outside Irbil's city limits. Lines of trucks pummel the roads to these sites, where crude oil is transformed into refined product.
"There's more money there than in a bank, but nobody guarding it," said Abd Karouk, a captain in the Kurdish peshmerga, the fighting forces that have slowly begun to push back against ISIS's northern advance. "Why steal money when you can make it just as easily?"
With its control of seven oil fields and two refineries in northern Iraq, and six out of 10 oil fields in eastern Syria, ISIS is currently making millions daily from oil revenues. Al-Khateeb estimates that the fields ISIS captured in Iraq have a capacity of producing 80,000 barrels of oil per day, but that ISIS is currently extracting half that amount. Still, with the price of crude oil on the black market currently at $25–$60 a barrel, ISIS is likely making $2 million daily from its Iraqi oil fields alone, he said.
"From Syria they could be making double or even triple that," said al-Khateeb, though he added that exact figures were unknown since much of the oil in Syria was being sold back to the regime of Bashar al-Assad through middlemen, and the Syrian regime did not release details of its trade in oil. "It's a war of survival for the Syrian regime and they have no choice but to buy the oil — even though they know the money is going into ISIS hands."
The regional dependence on oil as a trade currency has led many governments to do business with ISIS, despite knowing that they were feeding the insurgency that could one day overwhelm them. Until recently Kurdish buyers in Turkey and Iraq were buying large quantities of oil from ISIS, thus channeling funds into the very group that is now seeking to destroy them. Kurdish municipal workers who deal with the local refineries say that ISIS was offering crude oil at nearly half the price of other oil on the market, so nobody really bothered to distinguish it from the tens of thousands of other barrels of oil that made their way into this region of northern Iraq.
Crude oil, said the Kurdish officials, can often come from dozens of different areas to get processed at one refinery. The dealing in oil is done by a mixed bag of local businessmen and foreign workers, many of whom are looking to simply get as many barrels of oil refined and shipped out per day as possible — with little to no oversight given to the origins of the barrels.
"It wasn't until ISIS was on our doorstep that we started to make efforts to stop this. We realized we were giving them the money that they would use to attack us," said Karouk.
Karouk and other local officials who spoke to BuzzFeed said they believed that by this week, very little ISIS oil was making its way to Kurdish refineries, although it was hard to strictly monitor what was being sold on the black market.
"There will always be a middleman looking to make a profit who will try to sneak some through. But we don't believe it is here in huge quantities anymore," Karouk said. Middlemen, he explained, were often opportunistic businessmen who bought the crude from ISIS and then mixed it with other products or presented it as having been purchased elsewhere.
Jordan and Turkey have likewise made efforts to stop the free flow of black market oil into their territories, though experts say they've had much less success than the Kurdish authorities.
"This is coming in on trucks, through several middlemen," said al-Khateeb. "It is being sold on the black market and few companies are bothering to verify where the crude oil is coming from."
Al-Khateeb said the next step was for ISIS to seize control of refineries to take control of the process of turning the crude oil into a refined product to cut out the middlemen. Keeping up production levels, however, would require either local hands with experience, or imported staff with expertise.
"They are looking towards a long-term economic model," he said.
Archeologists trying to explain the extent to which ISIS has looted archaeological sites often rely on Google Earth to make their point. Zooming over areas of northern Syria and western Iraq currently held by ISIS, one British archaeologist told BuzzFeed, "What's happened here is historical devastation."
"We are talking about areas that were part of the cradle of civilization being pillaged, artifacts going back thousands of years that should be studied in museums are instead disappearing to the black market," said the British archaeologist, who works as part of a team that tries to verify whether antiquities reaching London are legally sourced. He asked not to be named as he did not want to expose his wealthy clients who guard their privacy. "We are also seeing unheard of numbers of stolen goods making their way into auction houses which are considered reputable."
According to documents recently published by The Guardian, ISIS has managed to net up to $36 million from smuggling plundered artifacts in one region of Syria alone. Experts estimate the total amount of smuggled goods could be worth 10 times that, while UNESCO recently estimated that the global trade in conflict antiquities could be worth more than $2.2 billion.
ISIS makes money not only from smuggling antiquities like vases, mosaics, and other artifacts looted from the areas they control, but also by levying a tax on traffickers who want to move illegally obtained artifacts through the areas they control.
Khalil, a 31-year-old former storekeeper, sits in the courtyard of a funeral home in the Kurdish city of Dohuk that is now being used as a processing center for tens of thousands of Iraqis who have fled the advance of ISIS. His family's name — which he does not want publicly shared in order to protect them — is one of several dozen listed by local workers here as having missing members in the hands of ISIS.
"Every day we are registering more people who have been kidnapped by ISIS," said Jalal Lazgeen, a local volunteer with the Dohuk municipality. "We do not yet know what it will take to get them back."
There are no reliable estimates for how many people ISIS has kidnapped or held hostage as part of local racketeering schemes in the last two years. They often target wealthy businessman or politicians in the areas they conquer, although human rights groups say they have recently turned toward targeting women and children from ethnic minorities in northern Iraq as well. While Kurdish experts say the group could have made upwards of $10 million on kidnapping schemes this summer alone, others say the figure is likely much higher.
"Most of these ransoms are quietly paid off, and the figures are kept secret to protect others who are still being held," said one western security adviser, who works on the cases of foreign journalists and aid workers currently being held by ISIS. "Of course a foreign national can command a much higher ransom than a local businessman."
Earlier this week, ISIS revealed that it was holding a 26-year-old American aid worker and demanded a $6.6 million ransom for her release. Negotiators who had worked on the case of U.S. journalist James Foley, who was killed last week, said that ISIS had previously demanded $132.5 million for his release.
"These are the highest-profile cases, in which they demand the most, but there are plenty of local schemes being run daily in which they are earning millions," said the security adviser. In one case published earlier this year by Human Rights Watch, 24 Yazidi border guards were kidnapped together on June 13. Twenty days later, a ransom payment of $1.2 million was transferred to ISIS in exchange for the men.
Khalil said he did not know what ISIS would ask for his missing sisters and cousins. Whatever it was, he said, they would do whatever it took until they could pay.
"What choice do we have? We will pay, and we will find the money however we can," he said.
"This is the thing about what ISIS is doing — they are tried and tested methods that have been developed over decades by terror groups all over the world," said al-Khateeb, who has focused on the oil profits being made by the group, but has also watched the development of their kidnapping schemes and black market sales of antiquities. "They've basically taken what other terror groups did and honed and sharpened those skills."
Earlier this year, ISIS released a glossy report called "Terror Incorporated," outlining for the first time its objectives, accomplishments, and future goals in its own words. The report reads like a company evaluation for investors, boasting of its successes.
"What we see here is not some rag-tag group getting lucky," said one American defense official currently based in Amman who spoke to BuzzFeed by telephone on condition of anonymity as he was not authorized to speak to media. He called the report "terrifying."
"What we see here is a well-structured group on the rise," the official said, who, like many U.S. officials in the region, has been criticized for failing to foresee the meteoric rise of ISIS. "Even for those keeping a close eye on the rise of ISIS, the last few months have been shocking us in just how well-organized and self-sufficient they have become."
What ISIS will do next is anyone's guess, he said, adding that not everyone agreed with the recent assessments by the Pentagon ISIS would turn its attention to attacking the U.S. and Europe, possibly using the passports of hundreds of foreign fighters who have joined its ranks.
"What we know about them is that they won't do anything that isn't a logical step forward for them to grow and expand their influence," said the defense official. "How they use their influence and wealth is still left to be seen."