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U.S. Seizes Bitcoin And Crypto Accounts Allegedly From ISIS, Al-Qaeda

U.S. Seizes Bitcoin And Crypto Accounts Allegedly From ISIS, Al-Qaeda

ISIS
U.S. seizes Bitcoin and crypto accounts allegedly from ISIS, which ran a covid-19 PPE scam site, ripping off people to finance terrorist attacks. Photo by Morning Brew on Unsplash

ISIS allegedly ran a covid-19 PPE scam site, ripping off people desperate for hard-to-find protective equipment such as masks and using the proceeds to buy cryptocurrency and finance terrorist attacks, the U.S. government reported.

The U.S. seized about $2 million, more than 300 bitcoin and ethereum accounts and four websites from known Islamic extremist groups including al-Qaeda, Hamas’ al-Qassam Brigades military wing and the Islamic State of Iraq and the Levant (ISIS), Bloomberg reported. The Justice Department said was “the government’s largest-ever seizure of cryptocurrency in the terrorism context.”

Court documents detail how an ISIS agent allegedly ran a scam website for covid-19 personal protective equipment known as FaceMaskCenter.com.

The action shows that the U.S. government can identify and infiltrate criminal or terrorist groups that think they’re operating anonymously — as many believe was promised by digital currency technology.

It is part of a wave of fraud that has flooded the internet since covid-19 pandemic began, according to Mark Turnage, CEO of DarkOwl, a security firm that’s tracked online pandemic-related scams for months.

“We’ve seen a massive volume of illegitimate materials like PPE being sold and never delivered,” Turnage said, according to Wired. “The fact that ISIS decided to get into this business too isn’t really surprising. Everyone’s a capitalist. They’re leveraging the pandemic too.”


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One of the great promises of cryptocurrency technology is anonymity, according to the Physics arXivBlog.

“The transactions are recorded and made public but they are linked only with an electronic address, so whatever you buy with your bitcoins, the purchase cannot be traced specifically to you.

“This is handy for some, but the anonymity is by no means perfect. Security experts call it pseudonymous privacy, like writing books under a fictitious name. You can preserve your privacy as long as the pseudonym is not linked to you.”

In a civil complaint, a confidential source linked an ISIS “facilitator” using the alias Murat Cakar with FaceMaskCenter.com and four Facebook accounts that advertised the site. The complaint alleges that he received $100,000 from Zoobia Shahnaz, an American woman who had planned to travel to Syria to join ISIS, and who pleaded guilty to material support of terrorism in 2018 after laundering ISIS funds with bitcoin.

FaceMaskCenter.com advertised FDA-approved N95 face masks, Tyvek suits, gloves, goggles, and thermometers. The site now shows a seizure notice from the Department of Justice, U.S. Treasury, and Department of Homeland Security, Wired reported.

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The U.S. also dismantled funding operations for al Qaeda and the Izz ad-Din al-Qassam Brigades that funneled cryptocurrency donations, solicited on the web and on Telegram, through BitcoinTransfer, a bitcoin exchange based in Syria.

Investigators from the IRS, FBI, ICE and the Justice Department’s National Security Division used undercover operations and other tactics to infiltrate the group’s campaigns, track their activities, pierce their digital currencies and take down their accounts, according to Bloomberg. Law enforcement agents even took over and operated one of the websites for 30 days.

“The action demonstrates how different terrorist groups have similarly adapted their terror-finance activities to the cyber age,” the Justice Department said in a statement. “Each group used cryptocurrency and social media to garner attention and raise funds for their terror campaigns.”