US Treasury Sanctions Gaza-Based Crypto Operator
The Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury has imposed sanctions on a crypto operator allegedly linked to the Palestinian militant group Hamas.
The move by OFAC comes as a result of greater scrutiny of terrorist financing following an attack by Hamas on Israel in early October, in which a number of Israelis lost their lives.
“Buy Cash Money and Money Transfer Company”
The entity targeted by these sanctions is a Gaza-based virtual currency exchange known as the “Buy Cash Money and Money Transfer Company.” It is operated by Khan Yunis, a resident of Gaza. According to the Treasury Department, both the exchange and Khan Yunis are alleged to have ties to Hamas. Ahmed M.M. Alaqad, the owner of the business, has also been named in the sanctions.
The primary objective of these sanctions, as stated by the Treasury Department, is to disrupt the sources of revenue for Hamas. The attack on Israel served as a trigger for these actions. Treasury Secretary Janet Yellen emphasized the determination to prevent Hamas from raising funds for further acts of terror and violence against the people of Israel.
This includes imposing sanctions and cooperating with international allies and partners to identify, freeze, and seize any assets related to Hamas in their respective jurisdictions. Yellen stated:
“The United States is taking swift and decisive action to target Hamas’s financiers and facilitators following its brutal and unconscionable massacre of Israeli civilians, including children.”
Crypto sector risk
It’s not the first time that crypto platforms have been implicated where terrorist financing is concerned. Earlier this year it emerged that Bitfinex Turkiye, the Turkish local exchange business of global crypto platform Bitfinex, was alleged to have been used for the purposes of money laundering by Hamas. Additionally, leading crypto platform Binance has found itself facing similar allegations.
In the immediate aftermath of the recent attack, Israeli authorities moved to close down accounts they claimed were linked with Hamas on crypto platforms like Binance and elsewhere. The Israelis have continued where they left off in this respect, with a report emerging earlier this week that over one hundred accounts on Binance have been ordered to be shut down, with a further two hundred accounts facing scrutiny.
While crypto may not account for a sizable proportion of terrorist financing means, these events open up a point of attack for those who oppose the further roll-out of decentralized money and systems.
Fighting illicit finance through sanctions
Notably, the US Treasury has been employing sanctions as a tool to cut off financial support to entities suspected of being involved in terrorism or other illicit activities. In a similar vein, earlier in October, the Treasury announced sanctions against crypto wallets associated with Chinese chemical manufacturers, concurrently with an indictment from the Department of Justice related to the production of the drug fentanyl.
Earlier this year, blockchain analytics firm Elliptic indicated that most Chinese suppliers of fentanyl precursors were accepting payments for the illicit material in cryptocurrency.
It’s worth mentioning that this move by OFAC not only targets Hamas but also includes other entities allegedly connected to the Buy Cash Money and Money Transfer Company, including an al-Qaeda affiliate and the Islamic State of Iraq and Syria (ISIS).
