The Department of Justice on Thursday announced the largest ever seizure of terrorist cryptocurrency accounts.
The DoJ said forfeiture complaints and a criminal complaint dismantled three terrorist financed cyber-enabled campaigns, involving the al-Qassam Brigades, Hamas’s military wing, al-Qaeda, and Islamic State of Iraq and the Levant (ISIS) that totaled more than $2 million.
Within the last month alone the DoJ has been extremely active in cracking down on crimes involving drug trafficking, money laundering, COVID fraud, human trafficking, child pornography, child trafficking and sexual assault against children and young adult teens.
U.S. President Donald J. Trump and Attorney General Wiiliam Barr, along with the rest of the Trump administration, are fulfilling their promise to make America safer against terrorism, curb corruption via money laundering and to crack down on criminals and protect the victims of human trafficking and fraud.
The complaints, unsealed in the District of Columbia, in an effort to curb the financing of cyberterrorism being financed through cryptocurrency. The seizure of the assets gained from these three organizations will hurt the efforts of the groups and send a message to any other cyberterrorism groups that the U.S. DoJ is monitoring their activities and will take action against them.
These groups all relied on sophisticated cyber-tools, including the solicitation of cryptocurrency donations from around the world and demonstrated how they have adapted their strategies to fit with the modern age of cyber networking through social media to finance their organizations.
This was a collaboration of multiple agencies including the Department of Homeland Security, The DoJ, the FBI, the IRS-CI Cyber Crimes Unit, The Treasury Department and several U.S Attorneys General.
Acting Secretary of Homeland Security Chad F. Wolf said: “After launching investigations that identified suspected online payments being funneled to and in support of terrorist networks, Homeland Security Investigations skillfully leveraged their cyber, financial, and trade investigative expertise to disrupt and dismantle cyber-criminal networks that sought to fund acts of terrorism against the United States and our allies. Together with our federal law enforcement partners, the Department will utilize every resource available to ensure that our Homeland is and remains secure.”
“These important cases reflect the resolve of the D.C. United States Attorney’s Office to target and dismantle these sophisticated cyber-terrorism and money laundering actors across the globe,” said Acting United States Attorney Michael R. Sherwin. “While these individuals believe they operate anonymously in the digital space, we have the skill and resolve to find, fix and prosecute these actors under the full extent of the law.”
“IRS-CI’s ability to trace funds used by terrorist groups to their source and dismantle these radical group’s communication and financial networks directly prevents them from wreaking havoc throughout the world,” said Don Fort, Chief, IRS Criminal Investigation
The DoJ has used similar tactics in the past to to monitor and take down drug dealers, on the dark web and child exploitation rings and sex traffickers who have also used social media to market and cryptocurrency to finance their operations.
Pursuant to judicially-authorized warrants, U.S. authorities seized millions of dollars, over 300 cryptocurrency accounts, four websites, and four Facebook pages all related to the criminal enterprise.
“It should not surprise anyone that our enemies use modern technology, social media platforms and cryptocurrency to facilitate their evil and violent agendas,” said Attorney General William P. Barr.
“The Department of Justice will employ all available resources to protect the lives and safety of the American public from terrorist groups. We will prosecute their money laundering, terrorist financing and violent illegal activities wherever we find them. And, as announced today, we will seize the funds and the instrumentalities that provide a lifeline for their operations whenever possible.”
Secretary of the Treasury Steve Mnuchin 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.”
“These important cases reflect the resolve of the D.C. United States Attorney’s Office to target and dismantle these sophisticated cyber-terrorism and money laundering actors across the globe,” stated Acting United States Attorney Michael R. Sherwin. “While these individuals believe they operate anonymously in the digital space, we have the skill and resolve to find, fix and prosecute these actors under the full extent of the law.”
The first action involves the al-Qassam Brigades and its online cryptocurrency fundraising efforts. In the beginning of 2019, the al-Qassam Brigades posted a call on its social media page for bitcoin donations to fund its campaign of terror.
The al-Qassam Brigades boasted that bitcoin donations were untraceable and would be used for violent causes. Their websites offered video instruction on how to anonymously make donations, in part by using unique bitcoin addresses generated for each individual donor.
Working together, IRS, HSI, and FBI agents tracked and seized all 150 cryptocurrency accounts that laundered funds to and from the al-Qassam Brigades’ accounts. Simultaneously, law enforcement executed criminal search warrants relating to United States-based subjects who donated to the terrorist campaign.
With judicial authorization, law enforcement seized the infrastructure of the al-Qassam Brigades websites and subsequently covertly operated alqassam.net. During that covert operation, the website received funds from persons seeking to provide material support to the terrorist organization, however, they instead donated the funds bitcoin wallets controlled by the United States.
The United States Attorney’s Office for the District of Columbia also unsealed criminal charges for two Turkish individuals, Mehmet Akti and Hüsamettin Karataş, who acted as related money launderers while operating an unlicensed money transmitting business.
The second cyber-enabled terror finance campaign involves a scheme by al-Qaeda and affiliated terrorist groups, largely based out of Syria.
These terrorist organizations operated a bitcoin money laundering network using Telegram channels and other social media platforms to solicit cryptocurrency donations to further their terrorist goals. In some instances, they purported to act as charities when, in fact, they were openly and explicitly soliciting funds for violent terrorist attacks. For example, one post from a charity sought donations to equip terrorists in Syria with weapons.
Undercover HSI agents communicated with the administrator of Reminder for Syria, a related charity that was seeking to finance terrorism via bitcoin donations. The administrator stated that he hoped for the destruction of the United States, discussed the price for funding surface-to-air missiles, and warned about possible criminal consequences from carrying out a jihad in the United States.
Al-Qaeda and the affiliated terrorist groups together created these posts and used complicated obfuscation techniques, uncovered by law enforcement, to layer their transactions so to conceal their actions. Today’s complaint seeks forfeiture of the 155 virtual currency assets tied to this terrorist campaign.
The final complaint combines the Department’s initiatives of combatting COVID-19 related fraud with combatting terrorism financing. The complaint highlights a scheme by Murat Cakar, an ISIS facilitator who is responsible for managing select ISIS hacking operations, to sell fake personal protective equipment via FaceMaskCenter.com.
The website claimed to sell FDA approved N95 respirator masks, when in fact the items were not FDA approved.
The site administrators offered to sell these items to customers across the globe, including a customer in the United States who sought to purchase N95 masks and other protective equipment for hospitals, nursing homes, and fire departments.
The unsealed forfeiture complaint seized Cakar’s website as well as four related Facebook pages used to facilitate the scheme which helped to avert the further victimization of those seeking COVID-19 protective gear, and disrupted the continued funding of ISIS.
The claims made in these three complaints are only allegations and do not constitute a determination of liability. The burden to prove the ability to seize assets in a civil forfeiture proceeding is upon the government and charges contained in criminal complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law as stated in the DoJ press briefing.