U.S. Treasury Intensifies Efforts to Disrupt Hamas’s Financial Operations: Unveiling the Fifth Round of Sanctions
Overview
In a decisive move to combat terrorism and disrupt the financial networks supporting Hamas, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has announced the fifth round of sanctions against the designated terrorist organization. This latest action, taken in collaboration with the United Kingdom and Australia, targets Hamas’s financial exchanges in Gaza, their owners, and associates, particularly those facilitating cryptocurrency transfers from the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) to Hamas and Palestinian Islamic Jihad (PIJ).
Shamlakh Network: Unraveling the Conduit of Funds to Hamas and PIJ
At the heart of Hamas’s financial operations lies the Shamlakh family, whose members have emerged as the primary conduit for funds flowing from the IRGC-QF to Hamas and PIJ in Gaza. Zuhair Shamlakh, a prominent Gaza-based financial facilitator, has played a pivotal role in transferring tens of millions of dollars from Iran to Hamas through his companies, Al-Markaziya Li-Siarafa (Al-Markaziya) and Arab China Trading Company.
Al-Markaziya, under the ownership of Zuhair and managed by his family members, has served as a direct channel for millions of dollars transferred from the IRGC-QF to Hamas and PIJ. In April 2023, the Israeli Defense Ministry’s National Bureau for Counter Terror Financing (NBCTF) took decisive action, seizing 189 cryptocurrency accounts associated with three Palestinian currency exchanges, including Al-Markaziya.
Other key players within the Shamlakh network include Ahmed Shamlakh, Alaa Shamlakh, and Imad Shamlakh, each contributing to the illicit flow of funds from Iran to Hamas and PIJ. Ahmed and Alaa facilitate money transfers to Hamas through their connections to money changing companies, including Al-Markaziya. Imad, on the other hand, has enabled the transfer of Chinese yuan from bank accounts in China to accounts controlled by Hamas in Gaza.
Herzallah Network: Unveiling Hamas’s Crypto-Based Money Laundering
Hamas has also employed various methods to illicitly transfer funds to the West Bank from Gaza, including the use of cryptocurrencies. Herzallah Exchange and General Trading Company LLC (Herzallah Exchange) has emerged as a key player in facilitating these transactions, including cryptocurrency exchanges, and has engaged in money laundering activities for both Hamas and PIJ.
Samir Herzallah and Brothers For Money Exchange and Remittances (Samir Exchange) has also been implicated in facilitating money transfers for Hamas, handling millions of dollars worth of funds since at least 2014. Thair Abd Al Raziq Shukri Hirzallah, a Gaza-based financial facilitator, has previously coordinated transfers of millions of dollars to Türkiye and handled financial transactions for both Hamas and PIJ.
Sanctions Implications: Disrupting Financial Flows and Imposing Consequences
As a result of these sanctions, all property and interests in property of the designated individuals and entities are subject to blocking and must be reported to OFAC. Additionally, any entities owned 50% or more by one or more blocked persons are also considered blocked.
Non-U.S. financial institutions and individuals engaging in transactions or activities with sanctioned entities and individuals face the risk of sanctions or enforcement actions. The prohibitions encompass making contributions or providing funds, goods, or services to or for the benefit of any designated person.
Treasury’s unwavering Commitment: Humanitarian Assistance and Countering Terrorism
Despite these sanctions, the Treasury remains steadfast in its commitment to enabling the flow of legitimate humanitarian assistance to vulnerable populations while concurrently denying resources to malicious actors. OFAC sanctions programs incorporate provisions for legitimate humanitarian support, including authorizations for certain humanitarian transactions in support of nongovernmental organizations’ activities.
Additional Resources: Delving Deeper into the Sanctions and Humanitarian Assistance
For more comprehensive information on the designated individuals and entities, visit the Treasury’s website. Furthermore, the Treasury provides additional resources on countering the financing of terrorism, including compliance communiques and guidance on providing humanitarian assistance to the Palestinian people.
Join the fight against terrorism by reporting any suspicious activity or transactions related to Hamas’s financial networks. By working together, we can disrupt the flow of funds to terrorist organizations and contribute to a safer world.