US Gov't Sting Operation Confiscates $1 Million in Terrorist Bitcoin Scheme

In an elaborate sting operation, the U.S. Justice Department announced that it had dismantled hundreds of cybercurrency accounts operated by Hamas, al-Qaeda and ISIS to fundraise for their violent actions.

The impressive operation even involved covertly taking over a Hamas Bitcoin account and diverting the funds to the U.S. government.

In the end, the U.S. seized more than a million dollars, 300 cryptocurrency accounts, four websites and four Facebook pages related to the terror fundraising campaigns.

In making the announcement, U.S. Attorney General William Barr noted the coordinated and innovative efforts of numerous branches of the government involved in the effort. Barr specifically thanked investigators from the Internal Revenue Service, Department of Homeland Security and Federal Bureau of Investigation as well as prosecutors from the D.C. United States Attorney’s Office and National Security Division.

Hamas

The government’s first operation was against Hamas’ military wing, the al-Qassam Brigades. Beginning in 2019, the al-Qassam Brigades posted calls on their social media page for Bitcoin donations. The campaign was later moved to its websites — alqassam.net, alqassam.ps and qassam.ps.

On these sites, Hamas not only boasted that the donations would be for violent causes, they said the money would be untraceable. The websites offered video instructions on how to anonymously make donations, in part by using unique Bitcoin addresses generated for each individual donor.

However, the U.S. government managed to track and eventually seize 150 cryptocurrency accounts used by Hamas to launder the money. Search warrants have been issued to U.S.-based individuals who donated to these accounts.

During the investigation, the government was able to surreptitiously take over the infrastructure of the Hamas websites and actually became the operator of alqassam.net. Donations made through the website went directly to the U.S. government.

Al-Qaeda

The cyber-funding activities by al-Qaeda and its affiliated terrorist groups were mainly based in Syria and were intended to finance the purchase of weapons for these groups.

Al-Qaeda’s Bitcoin money laundering schemes used Telegram channels and other social media platforms to solicit funds. In many cases, they defrauded donors by posing as charities.

Al-Qaeda created complicated mechanisms to layer the transactions to conceal their true intent, however, the U.S. government was able to uncover their methodology. Based on the efforts of Homeland Security agents, the Justice Department is seeking forfeiture of 155 virtual currency assets tied to these al-Qaeda campaigns.

ISIS

The cyber-fundraising efforts by ISIS involved both the Justice Department’s initiatives to combat COVID-19 fraud with their efforts to curb terror financing.

The ISIS scheme cracked by the government was managed by ISIS operative Murat Cakar, whose responsibilities included overseeing select ISIS hacking operations.

In this case, the strategy involved selling fake personal protective equipment via a website called FaceMaskCenter.com to finance terror.

The website claimed to have FDA-approved N95 respirator masks for sale. The fake masks were offered in near-unlimited supplies (in spite of the fact they have been designated as scarce by the government).

The site offered to sell the masks as well as other protective equipment to customers across the globe. One of their customers included a United States resident who tried to purchase N95 masks and other protective equipment for hospitals, nursing homes and fire departments.

The Justice Department seized the website as well as four related Facebook pages used to facilitate the scheme, averting not only terror funding but the defrauding of institutions seeking medical-grade protective gear.

Turkey Meanwhile, it is worth nothing that while the U.S. government was busy fighting Islamist terrorists, U.S. “ally” and NATO member Turkey was reportedly busy offering citizenship to senior Hamas operatives who currently reside in Istanbul.

The operatives, who are considered “active” were released from prison and deported from Israel in a 2011 prisoner exchange for Israeli soldier Gilad Shalit.

The Telegraph reported that journalists from the paper saw the Turkish identity papers and found that at least one of the 12 senior Hamas members received Turkish citizenship and an identity number.

The citizenship also was reportedly extended to the families of the Hamas operatives.

As reported by The Jerusalem Post, a senior source told The Telegraph that the Hamas operatives “are not foot soldiers but the most senior Hamas operatives outside of Gaza. [They] are actively raising funds and directing operatives to carry out attacks in the present day.

“The Turkish Government gave in to pressure by Hamas to grant citizenship to its operatives, thereby allowing them to travel more freely, endangering other countries that have listed Hamas as a terror group,” the source noted.

Holders of Turkish passports are able to travel to Japan, South Korea, Singapore and Serbia, among other countries without having to obtain a visa.

Turkey is currently working on an agreement with the European Union for visa-free entry for its citizens.

Turkey and its president Recep Tayyip Erdogan have historically been one of the largest funders of Hamas.

Hamas leader Ismail Haniyeh is currently visiting Turkey. Haniyeh was Hamas’ ruler of the Gaza Strip between 2014 and 2017 and became Hamas’ political chief upon leaving office.