Multi-million dollar plan to block terror funding in South-East Asia

$4.6 million will be invested to block funding to Islamic State-aligned terrorist groups in South-East Asia, through a Federal Government initiative to be led by financial intelligence agency AUSTRAC.

Minister for Justice Michael Keenan said the Government will work closely with neighbouring countries to stamp out efforts by ISIL to establish a local presence, following its decline in the Middle East, and to strengthen security for Australia and the region.

"This money will be used to detect and disrupt funding to Islamic State-aligned terrorist groups, and I look forward to our international partners joining a new regional Counter ISIL financing group," Mr Keenan said.

"AUSTRAC will be building on work already underway with our regional partners, including through the Counter Terrorism Financing Summit.

"AUSTRAC will also work with its industry partners in the Fintel Alliance-a world-first private-public partnership with major financial institutions-to prevent funding destined for ISIL being moved through Australia's financial institutions and harden regional financial institutions against this threat."

The $4.6 million package over three years will help AUSTRAC and its partners use non-traditional approaches to identify methods of funding by Islamic State in the region, develop countermeasures, and support the work of defence, law enforcement and intelligence agencies.

"The Australian Government is committed to working closely with our regional counterparts to address the threat of returning foreign fighters and home grown terrorism in the region.

"The need for greater cooperation with our neighbours has never been more critical," Mr Keenan said.

"The AFP has also increased their engagement with the Philippines, with four dedicated officers now based in the country, focused on countering the threat of ISIL in the region. Another two officers will arrive by the end of next month."

This investment by the Turnbull Government will also support our national security efforts to combat ISIL, by building AUSTRAC's capability to detect funding being used for terrorist plots in Australia and promoting this radical ideology, as well as locally raised funding destined for ISIL overseas.

"No single country can defeat ISIL alone, but together we create a united force that can defeat this threat."

"This is why Australia is taking a leadership role and joining forces with our regional neighbours to do everything within our powers to stop ISIL from getting a stronghold in our backyard.