Financial Crime World

Regional Powers Help Transfer Money to Hamas, FinCEN Warns

The Financial Crimes Enforcement Network (FinCEN) has issued an advisory warning about the use of money transfer companies and other financial intermediaries by Hamas to move funds across borders. The agency highlighted the involvement of several regional powers in facilitating these transactions, posing significant risks to global security and financial stability.

Regional Powers Involved

  • Algeria
  • Lebanon
  • Saudi Arabia
  • Sudan
  • Türkiye
  • United Arab Emirates (UAE)

FinCEN’s analysis of Bank Secrecy Act (BSA) data reveals that money is being transferred through these countries to fund Hamas’ activities. The agency noted that Iran has been providing significant financial support to Hamas since 2018, with estimates suggesting up to $100 million per year.

Disrupting the Flow of Funds

  • The US Treasury Department has sanctioned numerous financial intermediaries and facilitators linked to Iran and Hamas.
  • FinCEN warned about the use of “sham” charities by Hamas, which claim to provide humanitarian assistance but actually funnel money to terrorist organizations.
  • The agency highlighted the exploitation of crowdfunding and social media platforms by these groups to raise funds under the guise of humanitarian aid.

Cryptocurrency and Virtual Assets

  • FinCEN detected significant activity involving cryptocurrency and virtual asset service providers (VASPs) in facilitating transactions for Hamas.
  • While some VASPs have suspended their services due to law enforcement action, there is evidence that Hamas has adapted and continues to use alternative methods to safeguard the anonymity of its donors.

Houthis also Targeted

FinCEN has also highlighted the involvement of the Houthis, an Iran-backed Islamist movement in Northern Yemen, in using money transfer companies to move funds across borders. The agency warned that this activity poses significant risks to global security and financial stability.

  • FinCEN’s analysis revealed that the Houthis have been using money transfer companies to fund their military campaign in Yemen, which has led to significant humanitarian crises and displacement of civilians.

Conclusion

The international community must work together to disrupt the flow of funds to terrorist organizations like Hamas and the Houthis. FinCEN urges financial institutions to remain vigilant and report suspicious activity promptly. Effective regulation and oversight by financial institutions are crucial to preventing the misuse of financial systems.