US Department of Justice: Strike against terrorist financing with Bitcoin

The US Department of Justice announced on Thursday a great success in the fight against terrorist financing using cryptocurrencies such as Bitcoin. As part of a coordinated operation, US law enforcement agencies stopped three cyber campaigns that are said to have raised virtual money for Al-Qaeda, the Islamic State (IS) and the Hamas organization Qassam Brigades.

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“These actions represent the largest ever seizure of crypto money by the government in connection with terrorism,” announced the Department of Justice. The three funding campaigns were based, among other things, on advertising via social networks to collect donations via Bitcoin & Co. The operation shows that various terrorist groups have adapted their money acquisition to the digital age in a very similar way.

According to the announcement, US authorities confiscated over 300 accounts for cryptocurrencies, four websites and four Facebook pages, all of which were connected to the criminal ventures and some of which had been disguised as online sites of charitable organizations. The law enforcement officers had fallen into the hands of “millions of dollars”. According to media reports, it is around two million US dollars.

In one of the proceedings, the US authorities accuse a Turkish citizen of having sold counterfeit protective equipment such as allegedly state-approved N95 filter masks via the domain, thereby generating income for the IS. The defendant is also responsible for hacking operations on behalf of the terrorist organization.

The FBI, ICE Border Police, the Department of Justice’s National Security Division and the IRS reportedly used undercover agents and other tactics to infiltrate the suspects’ campaigns, track their activities, investigate their digital currency transactions and their accounts switch off. Law enforcement officers even took over the Kassam website and ran it themselves for 30 days.

“It should come as no surprise to anyone that our enemies use modern technology, social media platforms and cryptocurrencies to carry out their evil and violent intentions,” said US Attorney General William Barr. According to law enforcement officers, Bitcoin in particular has established itself as a means of financing in the “Darknet”. Payments with the cryptocurrency and the transaction partners involved can in principle be traced with a little effort. Contrary to what is often claimed, the bitcoin system is not anonymous, but pseudonymous. The blockchain with all payments can be viewed, transactions can be tracked.

According to current EU money laundering regulations, operators of exchange offices for virtual currencies and providers of electronic wallets must monitor their customers as part of the “normal due diligence” for financial houses. This includes storing the identity of the users and their wallet addresses in a central database. According to the EU Parliament, providers of crypto tokens should also use analytical tools “to evaluate possible criminal activities in connection with the destination and the recipient address”.


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