Blockchain intelligence firm Chainalysis worked with the U.S. Department of Justice to shut down rings raising money for al-Qaeda and Hamas’ al-Qassam Brigades, it was announced today.
The operations seized more than $1 million in Bitcoin from both terror groups and the unlicensed money services business they worked with, the company said.
“Terrorist networks have adapted to technology, conducting complex financial transactions in the digital world, including through cryptocurrencies. IRS-CI special agents in the DC cybercrimes unit work diligently to unravel these financial networks,” said Treasury Secretary Steven Mnuchin in an Aug. 13 release. “Today’s actions demonstrate our ongoing commitment to holding malign actors accountable for their crimes.”
The IRS criminal investigations division has worked with Chainalysis on a number of other high-profile Bitcoin-tracking cases, including the operation that led to the closure of child pornography site Welcome to Video. The FBI and Homeland Security were also involved in the terrorism cases.
“We’re proud to say that Chainalysis tools aided in the investigation of the two campaigns relying on cryptocurrency donations,” Chainalysis said in an in-depth blog post and an associated intelligence brief. “These cases show that the financial facilitators and infrastructure that terrorist groups have traditionally used to move money, such as unlicensed MSBs and hawala networks, have begun to adopt cryptocurrency. Blockchain analysis enables further investigation into the donation campaigns that terrorist groups conduct on social media, as well as the larger underlying financial networks that facilitate their operations.”
Chainalysis has come in for harsh criticism from the cryptocurrency community recently for working with governments and law enforcement. It kicked off when Andreas Antonopolous called the company “fundamentally immoral” and accused it of being “in an arms race against privacy.”
Hamas
The al-Qassam Brigades campaign started in early 2019, when went on social media and then its official websites to request Bitcoin donations to fund its terror campaign, according to the DoJ.
“The al-Qassam Brigades boasted that bitcoin donations were untraceable and would be used for violent causes,” the DoJ said. “Their websites offered video instruction on how to anonymously make donations, in part by using unique bitcoin addresses generated for each individual donor. However, such donations were not anonymous.”
This allowed the agencies to seize 150 cryptocurrency accounts laundering money for the organization and to seize and covertly operate the alqassim.net website.
Al-Qaeda
Al-Qaeda turned to social media platforms including Telegram to run a campaign based in Syria. Calls were made specifically seeking funds to buy weapons.
Chainalysis said more than $280,000 worth of bitcoins were laundered through through unlicensed Syrian money services business since the end of 2018. The DoJ is still trying to seize funds from al-Qaeda connected bitcoin addresses, and the Syrian address where the bitcoins were funneled remains active.
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