It's trendy to blame the Islamic State on Saudi Arabia - either the shifty House of Saud turning a blind eye to crazed Sunni extremists wiring money up to Mosul, or directly backing the group as part of their nefarious plan for world domination. Neither theory makes much sense.
DOING THEIR BEST
Although the 9/11 Commission found no wrong-doing on the part of the Saudi government, Riyadh had already begun working with the Americans and the United Nations to implement a new set of money laundering and terror financing laws, which were ratified in 2003 by an intra-governmental ombudsman - the Financial Action Task Force, based in Paris.
A key policy was cracking down on so-called "Islamic charities" which were a typical vehicle to channel money abroad to terror groups. To this day, charities and NGOs are allowed only one bank account where all transactions are closely monitored. In addition, bank accounts for charities and NGOs are prevented from making any transactions to foreign bank accounts.
Saudi Arabia also created a "Financial Intelligence Unit" which deals with suspicious transactions using a team of analysts, working with a range of semi and fully automated systems, mandatory for all licensed financial institutions in Saudi Arabia. And the C.I.A. began collaborating closely with Saudi intelligence.
Progress was admittedly slow. By December 2009, Hillary Clinton still judged the Kingdom as "a critical source of terrorist funding."
FATF conducted a further review in 2010 which said KSA were still in line with international law - although did note administrative difficulties (for example some backlogs and out-of-date computer systems) and additionally recommended Riyadh implement a specific crime for terrorism financing.
The latter part was acted upon by Riyadh in December 2013 with the "Penal Law for Crimes of Terrorism and its Financing," with the legislature defining the offence as"any action that includes gathering, giving or allocating funds to any terrorist activity, collective or individual, domestic or perpetrated abroad."
The addition of a specific crime was also backed up by Riyadh's first list of designated terrorist organisations, which included Al Qaeda and its affiliates (including the Al Nusra Front, Al Qaeda-Iraq, and Al Qaeda in the Arabian Peninsula), Saudi Hezbollah and certain Houthi Groups in Yemen. The list also included the Muslim Brotherhood.
Lori Boghardt, an ex-CIA analyst at The Washington Institute for Near Eastern Policy, recently noted that "Riyadh could do much more to limit private funding. U.S. officials have hinted that a combination of politics, logistics, and limited capabilities have impeded more effective Saudi efforts."
But Boghardt also argued that the existence of social media fundraising campaigns for the Islamic State suggest private funders in Saudi Arabia were now finding it harder to get money to the bad guys.
Boghardt also noted the importance of illegal transfers being made in cash - which the Saudis have as much difficulty policing as anyone else. That said - at least a few of these transfers were almost certainly made in 2012 and 2013, especially via Turkey, as well as Saudi Arabia's northern border with Iraq.
Patrols have been stepped up and Riyadh are rumoured to have a network of agents in place within southern Iraq to try and disrupt these flows.
But Boghardt also provided some important wider context on why Saudi Arabia has little interest in funding IS - and every interest in stopping private donors slipping those truckloads of cash across the border.
Riyadh's concern about blowback -- namely, the belief that allowing citizens to support terrorist groups hostile to the al-Saud monarchy will eventually spawn attacks on Saudi soil -- helps drive the kingdom's counterterrorism approach.
SCARED TO DEATH
Top of mind in Riyadh is the menacing precedent of the Siege of the Grand Mosque in November 1979, which saw five hundred Salafi extremists take control of around one hundred thousand Muslim hostages who were at conducting their dawn prayers inside the Grand Mosque, Mecca.
The extremists, like those of the Islamic State, were numerous, well organized and well armed. They smuggled in their guns in coffins and underneath long robes, took control of the mosque, and declared that their leader, Juhayman ibn Muhammad ibn Sayf al Otaibi, was a new messiah.
The Saudis, deeply embarrassed, had to storm the mosque by force, ramming armoured personal carriers through the gates, firing shells into the minarets (where the extremists had positioned snipers) and gassing those remaining in the tunnels underneath. It took two weeks to re-gain control of Islam's most holy site.
In a recent interview, a senior Islamic State defector claimed that the next targets for his former organisation could well include Mecca and Medina.
In the second edition of the magazine Dabiq, published by an IS propaganda outfit, the threat was explicitly confirmed.
Separately, ISIL militants have announced that they may soon begin armed operations in Saudi Arabia, using arms and money supplied by al-Qaeda agents. Riyadh has every reason to fear al-Qaeda - the Kingdom suffered from a series of devastating Al Qaeda linked attacks from 2003 onwards.
In response - Riyadh have sent funding to the Lebanese Army and financed United Nations counter-terrorism efforts. In August, Saudi Grand Mufti Sheikh Abdul Aziz al-Sheikh denounced the Islamic State as "enemy number one" of Islam, adding that "The ideas of extremism, radicalism and terrorism ... have nothing to do with Islam and (their proponents) are the enemy number one of Islam."
Riyadh have also deployed thirty thousand troops to the Iraq border, which lies exposed to any potential ISIS advance. In May, the government claimed to have uncovered a significant terrorist cell and arrested fifty nine Saudi citizens over their alleged connections to terrorism in Iraq and Syria.
Last week, security authorities arrested eighty eight more. Saudi diplomats have even opened talks with their traditional nemesis Tehran, exploring an unlikely tactical alliance to defeat a common enemy.
When it comes to Syria - it's clear that the Kingdom has not shied away from arming some Islamist groups - though they have stopped well short of funding anyone linked to al-Qaeda or ISIS, or the groups themselves.
Indeed, Saudi Arabia began their funding for the Syrian opposition by offering support to the Free Syrian Army in 2012, and made clear during 2013, a year which saw their influence on the Syrian opposition eclipse that of Qatar, that they would be specifically excluding ISIS and al-Qaeda affiliate groups from access to money and training.
Some experts have noted that the Saudis prefer to back "regime defectors, independent tribesmen, so-called "quietist Salafis" and even liberals over the more extreme jihadi groups in Syria," while others assess Saudi Arabian strategy since the takeover from Qatar to be backing "the least Islamist component of the rebellion."
Indeed, Saudi Arabia has fallen out with Qatar of late, over whether Islamist groups should be backed by Gulf funding, partly because Riyadh favours a secular rather than an Islamist government in Damascus, should Assad fall.
There is no doubt that some of the arms and training Riyadh have channelled to the Syrian rebels may have ended up with the Islamic State, or al-Qaeda, but this is a criticism that could equally be levelled at any of the Western and Middle East powers now involved in the conflict.
But overall - Riyadh simply have no interest in funding the Islamic State themselves, nor in allowing funding from private donors to reach heavily armed extremists sat right on the Kingdom's doorstep. Though its popular to continue blaming them - it's a lazy analysis based on a bogus stereotype.
So how is IS being funded? Nowadays, it's the same as most states in the Middle East - oil. Might not be as glamorous as a good ol' fashioned conspiracy theory, but that's probably the truth.