#FinCEN issued an alert on October 20th to financial institutions, urging them to identify and report "suspicious activity" related to funding terrorist groups, with a specific focus on Hamas . The alert pointed out that Hamas has been using virtual currency and fictitious charities to raise both fiat and virtual currency for its activities. Financial institutions were advised to watch for clients engaged in transactions with businesses in Hamas-associated jurisdictions, entities on the Office of Foreign Assets Control's list of Specially Designated Nationals, and those soliciting cryptocurrency donations through social media. This warning comes after FinCEN proposed designating #crypto -mixing services as a primary concern related to money laundering and terrorism financing. U.S lawmakers and officials have also intensified efforts to combat "crypto-financed terrorism" following reports of Hamas using #cryptocurrency for fundraising, with over 100 lawmakers requesting an explanation of the administration's strategy to address this issue. The U.S Department of the Treasury's Office of Foreign Assets Control ( #OFAC ) imposed sanctions on a Gaza-based virtual currency exchange and other Hamas operatives in response to these concerns. This is not the first time FinCEN has issued such a warning; a similar alert was issued in March 2022 concerning Russian entities attempting to evade sanctions using #cryptocurrencies during the invasion of Ukraine.

The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) said it has seen a rise in the number of Bitcoin transactions used in connection with human trafficking and online child exploitation cases.

Of the 2,311 Bank Secrecy Act (BSA) reports received, 2,157 reports referenced Bitcoin as the primary convertible virtual currency used for human trafficking and online child exploitation cases. From this FinCEN said it then identified over 1,800 unique wallet addresses related to suspected online child exploitation cases and human trafficking offences.

Earlier this month, the U.S. Department of the Treasury released its 2024 National Risk Assessments on Money Laundering, Terrorist Financing, and Proliferation Financing, outlining the most significant threats facing the United States in illicit finance.

The Treasury Department issued a stark warning regarding the escalating utilization of cryptocurrencies by criminals, fraudsters, and other illicit entities. The report detailed updates to the anti-money laundering and counter-financing of terrorism framework, addressing issues such as the fentanyl crisis, terrorist attacks, ransomware potency, professional money laundering, and digital payments’ growth.

FinCEN is appealing to the public to report any cases of child exploitation and human trafficking to law enforcement. The U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) tip-off line is: 1-866-DHS-2-ICE (1-866-347-2423) and outside the US authorities can be contacted by calling 802-872-6199.
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