Four suspects were charged for collecting and transferring $35,000 in cryptocurrencies to digital wallets and accounts associated with the Islamic State (ISIS).
According to a statement released by the US Department of Justice (DOJ) on December 15, a federal court in Brooklyn convicted Mohammad David Hashimi, Abdullah At Taqi, Khalilullah Yousuf, and Seema Rahman of conspiring to provide material support to the terrorist organization.
“As alleged, this crowdfunding network used cryptocurrency, Bitcoin wallets, GoFundMe, and PayPal to collect and raise blood money to support ISIS, not for needy families as they falsely claimed in their attempt to deceive law enforcement,” stated Breon Peace, the United States Attorney for the Eastern District of New York.
Communicated via encrypted chat
The evidence shows that the accused were members of a group chat on an encrypted messaging application that allowed communication between ISIS followers and other organizations that shared jihadist ideology.
In early April 2021, members of the chat discussed posting donation links. An unidentified chat participant wrote, "post all serious donation links that help our mujahideen ['Holy warriors']….For safety reasons, post just the links without telling for what the money is being used."
Yousuf posted a link to a particular crypto wallet, saying, "If anyone wants to donate to actual mujahideen in the battlefield…This brother is legit^^^." Another chat member shared a link to a PayPal campaign, both of which belonged to a person related to ISIS, known as Facilitator-1, according to the complaint.
"All we really need is maybe like 100,000 fighters and biidhnillah ['if Allah wills'] the Muslims could conquer the world because most of our enemies are cowards," Taqi allegedly wrote via an encrypted messaging platform to a confidential human source who, according to investigators, had been cooperating with them since October 2021.
Facilitator-1 and the Federal Bureau of Investigation’s (FBI’s) secret human source continued to correspond frequently. On June 8, 2022, the source urged the facilitator to provide evidence that the funds were being raised for actual ISIS members. The facilitator answered by sending an image of an ISIS flag covered in weaponry, including what looked like grenades.
According to the ISIS agent, he was responsible for the donations that arrived in the country. "I pass them to the Mujahideen in all the states," he allegedly told the FBI's human source.
Raised funds through funding platforms
Charges claim that the funds generated by the organization were used to pay ISIS fighters. In a period of one year and a half, the accused raised and transferred more than $35,000 to the ISIS agent using cryptocurrencies and digital payment platforms.
Defendants deposited cryptocurrencies to Facilitator-1's Bitcoin account, totaling more than $24,000.
Additionally, the accused sent over $1,000 to Facilitator-1's PayPal account. Rahman used the GoFundMe campaign to raise approximately $10,000, and she transferred the money to those associated with Facilitator-1 through Western Union.
To avoid suspicion, the group used false descriptions of their transactions. The group chat evidence shows that Facilitator-1 insisted on using charitable descriptions in the fundraising campaigns as a “deception for the infidels.”
According to the court documents, the campaigns used such descriptions as "Help raise funds for some needy families for Eid," "Widow in Need of Assistance," and "Ramadan Appeal for Gaza."
GoFundMe states in its policies that users cannot use services to promote “support of terrorism, hate, violence, harassment, bullying, discrimination, terrorist financing or intolerance of any kind” and claims to have a dedicated team to ensure safety.
Terrorist organizations adopting fintech
Terrorist organizations are adapting fast to the emerging technologies that help to evade sanctions and generate funds for their campaigns. In 2021, Israel’s National Bureau for Counter-Terror Financing seized an undisclosed amount of cryptocurrency held by several wallets associated with donation campaigns carried out by Hamas.
In September 2022, ISIS reportedly minted and tried to disseminate an NFT titled “IS-NEWS #01.” The NFT featured statements that applaud Afghan-based Islamic militants for attacking a Taliban position beside a photograph of the Islamic State symbol.
According to the Chainalysis report, criminal activity involving cryptocurrencies reached a record-breaking high in 2021, with illicit addresses obtaining $14 billion during the period of a year.
The number increased from $7.8 billion in 2020. However, the most considerable numbers are related to scams and stolen funds, while terrorism funding has a relatively small share.
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