U.S. Treasury Warns ISIS Is Laundering Up to $25,000 Per Month Through Cryptocurrency

A faction of ISIS is using cryptocurrency to launder as much as $25,000 each month, according to the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN).

In a notice issued earlier this week, FinCEN alerted financial institutions that ISIS is increasingly relying on digital assets to fund its operations. “ISIS and its affiliates have increasingly adopted digital assets, including virtual currency, as a means of storing and moving funds,” the agency stated.

Providing further details, FinCEN cited a report from the United Nations, which in 2023 found that ISIS’s Al-Karrar office was transferring up to $25,000 in virtual currency each month to ISIS-K.

FinCEN Flags Concerns Over ISIS’ Use of Crypto

According to FinCEN, the group primarily utilizes Bitcoin and stablecoins such as Tether (USDT) to generate and transfer funds. Additionally, ISIS has promoted fundraising campaigns involving Ethereum, Monero, and Tron.

“Virtual assets have been sent directly to ISIS supporters located in northern Syria, often to Idlib, or indirectly via Türkiye, where ISIS is able to access them through virtual asset trading platforms,” the notice explained.

The agency also warned that insufficient anti-money laundering (AML) measures at certain cryptocurrency firms have facilitated these transactions. “ISIS exploits virtual currency exchanges with lax or non-existent AML/CFT controls to send, receive, and convert funds,” FinCEN stated.

U.S. Regulators Ease Crypto Oversight

This warning from FinCEN comes at a time when U.S. regulators have been easing restrictions on cryptocurrency oversight. Authorities have recently withdrawn certain AML enforcement actions against crypto firms, reducing regulatory scrutiny.

In a controversial decision last month, the U.S. government lifted sanctions on Tornado Cash, a cryptocurrency mixer that had been accused of laundering over $7 billion for cybercriminals, including hackers linked to North Korea.

Additionally, the U.S. Office of the Comptroller of the Currency (OCC) announced that national banks are now allowed to engage in cryptocurrency-related activities without first obtaining regulatory approval. This decision marks a reversal of a Biden-era policy that required banks to seek supervisory non-objection before participating in crypto transactions.

Meanwhile, former President Donald Trump’s family recently took control of World Liberty Financial, a cryptocurrency firm that has raised $550 million from investors. 

By fLEXI tEAM