Shocking Revelation: $165M in Cryptocurrency Transactions Under Investigation for Possible Ties to Terrorist Group, Says High-Level Official

Federal authorities announced Wednesday the opening⁢ of an investigation into potential ties between⁤ an international extremist group​ and ​several cryptocurrency ‍exchanges⁢ that provide banking services to customers from⁣ foreign countries. The U.S. Treasury Department’s Financial Crimes Enforcement Network ​(FinCEN) identified ​approximately millions in suspicious transactions involving digital ⁢assets and most of the reporting institutions provided only partial reports. In ​addition, millions in ‍cryptocurrency transactions went unreported.

Financial institutions have reported $165 million in suspicious crypto transactions that ⁢may be tied ⁤to Hamas, an international extremist group, according to the U.S. Treasury department that combats‍ terrorism financing.

According to a letter ⁢signed by Deputy Treasury Secretary Adewale Adeyemo, the ⁣Financial Crimes Enforcement Network (FinCEN) analyzed suspicious activity reports filed ⁤between January ‍2020 and ‌October‌ 2023 and found more than 200 cryptocurrency addresses may have⁢ been⁢ involved in these transactions. The letter, directed to the‌ leaders of the Senate Banking​ and ‍House Financial Services Committees, requested support‌ in passing legislation to expand the Treasury Department’s ‌oversight of digital asset transactions.

The U.S. ⁢Treasury Department ‌is concerned that as traditional ⁢financial services are cut off from extremist groups, they may turn to virtual​ assets as ‌an alternative funding source. While there is limited ​evidence of terrorists exploiting ‍cryptocurrencies, there have been instances of such activity. ​In October 2020, a group of lawmakers wrote a​ letter to ⁢the Treasury Department asking for information‍ on the extent to ‍which Hamas used ⁤crypto in their attacks on Israel last ​October.

In response to this request,⁢ the ⁣Treasury‍ Department is seeking ⁢greater authority to pursue ​illicit activity in ‍the virtual asset ecosystem, particularly beyond U.S.‌ borders. This would include expanding the⁣ coverage ⁢of new entities in the virtual asset ecosystem that‍ may be operating in areas of ​ambiguity with ⁣regards ⁢to their obligations under the ‍Bank​ Secrecy Act. Additionally, the Treasury’s Office of Foreign Assets⁤ Control ⁢may ‌be given the authority ⁤to deploy​ secondary sanctions against virtual asset ⁢firms doing business with sanctioned entities.

However, the Treasury Department acknowledges ⁤that not all transactions reported as potential ​terrorist funding may ⁣actually be linked to these groups. There is a⁣ risk of over-attributing transactions to extremists⁢ when only ⁣a‌ portion of the reported activity ‌may ⁤have constituted such activity. The current analysis is ongoing and seeks to better understand the potential threats posed by cryptocurrencies and crypto services.

In⁣ conclusion, while ⁢there is limited evidence of cryptocurrencies ⁢being exploited by terrorist groups, ‌there is a concern that as traditional financial services are cut ⁣off, they may turn to virtual assets as an ⁢alternative form of funding. The Treasury Department is seeking greater authority ⁣to pursue illicit‍ activity in⁤ the virtual asset ecosystem and is‌ working ⁣towards clarifying and expanding coverage of new entities in this space.

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