Identifying funding streams for the terrorist organization Hamas in response to its Oct. 7 attack on Israel is the goal of an alert issued Friday by the Treasury’s financial crimes enforcement unit.
According to Treasury Department’s Financial Crimes Enforcement Network (FinCEN), it is urging financial institutions to be vigilant in identifying suspicious activity relating to financing Hamas and reporting it to FinCEN.
The agency said its alert contains red flags that FinCEN has identified to help detect, prevent, and report potential suspicious activity related to Hamas’s terrorist financing activity.
The Treasury said it is taking all steps necessary, including issuing the alert and engaging with foreign counterparts, to deny Hamas the ability to raise and use funds worldwide for its terrorist activities.
“Hamas raises funds to support its operations and members in a variety of ways, including through: support from Iran; private donations; a global portfolio of investments; diverting aid and support from legitimate charities; the control of border crossings and avenues of commerce; racketeering business frameworks; extortionary practices around local populations; and fundraising campaigns involving virtual currency and fictitious charities raising both fiat and virtual currency,” FinCEN said in its alert.
Financial institutions, including virtual asset service providers (VASPs), should identify and report suspicious transactions associated with Hamas’s financing as quickly as possible, FinCEN said.
It noted that Hamas moves funds through the smuggling of physical currency as well as a regional network of complicit money transmitters, exchange houses, and Hizballah-affiliated banks.
FinCEN said it also reminds financial institutions that Hamas and many entities and individuals associated with Hamas are subject to extensive sanctions by the U.S.
The seven “red flags” included in the alert are designed to help financial institutions identify suspicious activities related to Hamas’s terrorist financing activity. FinCEN said.
“As no single red flag is determinative of illicit or suspicious activity, financial institutions should consider the totality of available facts and circumstances, such as a customer’s historical financial activity, whether the transactions are in line with prevailing business practices, and whether the customer exhibits multiple red flags, before determining that a behavior or transaction is suspicious,” FinCEN said.
FinCEN Alert to Financial Institutions to Counter Financing to Hamas and its Terrorist Activities