WASHINGTON – Federal authorities seized millions of dollars in cryptocurrency as part of an operation that dismantled online campaigns to raise funds for major foreign terrorist groups, the Justice Department announced Thursday.
The department said al-Qaeda, the Islamic State and the al-Qassam Brigades, Hamas’ military wing, solicited cryptocurrency donations from around the world using various online tools to fund their terror activities — a sign of how different terrorist groups have learned to leverage new technologies.
U.S. investigators have seized $2 million, with more still subject to forfeiture, and about 300 cryptocurrency accounts in what authorities described as an unprecedented and wide-scale seizure of cryptocurrency tied to foreign terrorist groups. Also seized are four websites and four Facebook pages that were used to solicit funds.
Michael Sherwin, U.S. attorney for the District of Columbia, said investigators can’t yet tie the solicitation of cryptocurrency to actual terror-related incidents, but officials said the funds seized represent a significant dent to the groups’ operations. Assistant Attorney General for National Security John Demers said the seizures deprived the groups of funds they would’ve used to buy weapons and equipment, train terrorists and travel to other countries.
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The investigation that led to the seizures involved undercover operations. Investigators worked with covert sources who were communicating with the terrorist groups and provided federal authorities with information on the cryptocurrency accounts, Sherwin said.
“It should not surprise anyone that our enemies use modern technology, social media platforms and cryptocurrency to facilitate their evil and violent agendas,” Attorney General William Barr said in a statement. “Terrorist networks have adapted to technology, conducting complex financial transactions in the digital world, including through cryptocurrencies.”
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The online tactics involved openly asking for donations to fund terrorist activities, duping people into donating to fake charities, and exploiting the coronavirus pandemic by purporting to sell personal protective equipment or PPE, said Don Fort, chief of the Internal Revenue Service Criminal Investigations.
Image of FaceMaskCenter.com, a fake website that purported to cell N95 respirator masks, as part of a terrorist campaign to raise cryptocurrency funds. (Justice Department)
The Islamic State, for example, targeted hospitals, nursing homes and fire departments in the United States by offering to sell bulk quantities of PPE using fake websites and social media accounts, according to two senior Justice Department officials. One website, FaceMaskCenter.com, claimed to have unlimited supplies of FDA-approved N95 respirator masks. Officials said the website was a scheme by Murat Cakar, an ISIS facilitator responsible for managing the organization’s hacking operations.
Some tactics were more blatant.
Officials said al-Qaeda operated a bitcoin money laundering network to solicit donations, at times acting as charities whose goal is to fund weapons for Syrian terrorists. Undercover agents who communicated with one such charity was told the goal is to destroy the United States, officials said.
The Justice Department said al-Qaeda used charities to seek cryptocurrency donations to buy weapons for Syrian terrorists. (Justice Department)
Believing in a false sense of anonymity provided by cyber tools, the groups did little to hide their efforts, officials said.
al-Qassam Brigades, for example, advertised on social media in early 2019 about using bitcoin for violent causes and boasted that the donations were untraceable. The group directed users to their websites, where they offered instructions on how to donate anonymously, and created several cryptocurrency accounts to receive funds, according to court records.
The funds were then converted into traditional currency or exchanged for gift cards, according to court records. Investigators were able to track 150 cryptocurrency accounts that laundered funds to and from the terrorist group’s accounts.
Two Turkish nationals who officials said acted as money launderers have been charged. The Justice Department is also investigating several people, including U.S. citizens, who knowingly donated funds for terrorist causes. One American is facing charges in an unrelated drug case, officials said.
This article originally appeared on USA TODAY: DOJ: Cryptocurrency seized in terrorist financing investigation