The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has recently sanctioned Tawfiq Muhammad Said Al-Law, a hawala operator involved in Hezbollah crypto funding. Al-Law is accused of providing digital wallets to Hezbollah related to commodities sales benefiting the Quds Force, a branch of the terrorist organization Islamic Revolutionary Guard Corps that supports terrorist groups abroad. He is also accused of conducting cryptocurrency transfers for the Qatirji Company, a trucking business known for shipping weapons from Iraq to Syria. The U.S. remains committed to disrupting the illicit activities of the IRGC-QF and its proxy groups by taking action against individuals like Al-Law who facilitate terrorist financing.
Chainalysis, a blockchain intelligence firm, has shed light on Hezbollah’s crypto funding patterns, indicating that the organization receives funding through cryptocurrencies. Funds are often moved from financial facilitators to hawala services and over-the-counter brokers before ending up at Hezbollah-controlled addresses on mainstream exchanges. Hezbollah, founded in Lebanon in 1982 and largely funded by Iran, is known for its strong opposition to Israel. Chainalysis identified Al-Law in June 2023 following Israel’s seizure of over $1.7 million in cryptocurrency from Hezbollah, pointing to his role in helping the organization build its crypto funding infrastructure.
In response to the growing concern over terrorist organizations using cryptocurrencies for funding, the U.S. Financial Crimes Enforcement Network (FinCEN) is investigating donations totaling $165 million received by the Palestinian militant group Hamas before its October 7 attack on Israel. U.S. lawmakers, including Senator Elizabeth Warren, have called for increased legislation on digital assets to prevent terrorist groups from obtaining cryptocurrency funding. Warren’s Digital Asset Anti-Money Laundering Act has received bipartisan support as a measure to address the issue. The U.S. government is offering a $10 million reward for information that could disrupt Hezbollah’s financial system through its Rewards for Justice Program.
The actions taken by OFAC against Al-Law and other entities involved in terrorism financing demonstrate the U.S. government’s commitment to disrupting the flow of funds to terrorist groups. By targeting individuals and organizations that provide support to terrorist activities, the U.S. aims to weaken these groups and prevent them from carrying out further attacks. The use of cryptocurrencies by terrorist organizations has presented new challenges for law enforcement agencies, prompting calls for stronger regulations and oversight in the crypto space to prevent illicit activities and protect national security interests.
The global campaign to disrupt terrorism funding and prevent the use of cryptocurrencies for illicit purposes continues to gain momentum as new threats emerge. As technology advances, so do the tactics used by terrorist organizations to finance their operations. Governments and law enforcement agencies are working together to combat these challenges through targeted sanctions, investigations, and legislative measures designed to enhance oversight of the financial system. The case of Al-Law and his involvement in Hezbollah’s crypto funding operations highlights the need for increased vigilance and coordination in the fight against terrorism financing.
