By Al-Fassel | 2024-01-31

The United States last week sanctioned Hamas-affiliated networks that have facilitated fund transfers from the Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF) to Hamas and Palestinian Islamic Jihad (PIJ) in Gaza.

The US Treasury on January 22 imposed a fifth round of sanctions on Hamas since the October 7 terrorist attack on Israel.

The latest sanctions target "networks of Hamas-affiliated financial exchanges in Gaza, their owners and associates, and particularly financial facilitators that have played key roles in funds transfers," the Treasury said.

Fund transfers include cryptocurrency transfers from the IRGC-QF to Hamas and PIJ in Gaza, it said.

The United Kingdom and Australia have concurrently placed sanctions on key Hamas officials and facilitators.

"Hamas has sought to leverage a variety of financial transfer mechanisms, including the exploitation of cryptocurrency, to channel funds to support the group's terrorist activities," said Treasury official Brian Nelson.

The Treasury Department, "in close coordination with our allies and partners, will continue to leverage our authorities to target Hamas, its financiers and its international financial infrastructure," he said.

"These sanctions send a clear message to Hamas -- the UK and our partners are committed to ensuring there is no hiding place for those financing terrorist activities," British Foreign Secretary David Cameron said.

"The UK is committed to working with partners to tackle Iran's destabilizing activities in the Middle East, including its long-term support to terrorist and militant groups," he said.

The sanctions build on the United States' recent joint designations with the United Kingdom on December 13 and November 14, targeting Hamas leaders and financiers.

Previous sanctions on October 27 and October 18 targeted sources of Hamas support and financing, and Hamas operatives and financial facilitators.

In May 2022, the United States also designated officials and companies involved in managing Hamas's secret international investment portfolio.

Fund transfers in the millions

The latest sanctions targeted members of the Shamlakh family who, over the last several years, "have become the main end point for funds transferred from the IRGC-QF to Hamas and PIJ in Gaza," the Treasury statement.

Gaza-based financial facilitator Zuhair Shamlakh is a moneychanger who facilitates fund transfers "in the tens of millions of dollars" from Iran to Hamas.

He has used his companies Al-Markaziya Li-Siarafa (formerly known as Al-Mutahadun for Exchange) and Arab China Trading Company to channel funds for the Ezzedine al Qassam Brigades, the military wing of Hamas.

In 2017, Zuhair worked with Muhammad Kamal al-Ayy to coordinate the transfer of millions from Lebanon to Gaza, the statement said. Al-Ayy was designated in August 2019 for supporting Hamas.

The United Kingdom's foreign office said Zuhair is a key figure involved in the group's shift towards cryptocurrencies.

Gaza- and Türkiye-based Al-Markaziya is owned by Zuhair and managed by his family members. In April 2023, the Israeli Defense Ministry’s National Bureau for Counter Terror Financing (NBCTF) seized 189 cryptocurrency accounts associated with three Palestinian currency exchanges, one of which was Al-Markaziya.

Gaza-based financial facilitators Ahmed Shamlakh, Alaa Shamlakh and Imad Shamlakh "serve as key players in the financial flow from Iran to Hamas and PIJ using their ties to money changing companies, including Al-Markaziya."

Ahmed is one of the owners or directors of Al-Markaziya, and Alaa is the sole employee and officer of Al-Markaziya's branch in Türkiye.

Imad has directly facilitated the transfer of Chinese yuan from bank accounts in China to accounts controlled by Hamas in Gaza. He has also facilitated multiple transfers, worth approximately 50,000 CNY ($7,000) each, to accounts in China likely for the benefit of Hamas.

Additionally, Imad has smuggled cash from Egypt to Gaza on behalf of the Islamic State of Iraq and Syria in the Sinai (ISIS-Sinai).

Evading monitoring

"Hamas has used multiple methods of illicitly transferring funds to the West Bank from Gaza in order to fund and support recruitment and the purchase of weapons there," the US Treasury said.

It has "co-opted and utilized" corrupt money exchanges in the West Bank and Gaza to launder funds, it added.

Since at least 2020, Hamas has used cryptocurrency to transfer funds in support of operational costs in the West Bank "as a means of mitigating the risks of physically moving cash, circumventing border crossings, and evading monitoring by authorities," it said.

Gaza-based Herzallah Exchange and General Trading Company LLC has worked with Hamas to facilitate transactions, including through the use of cryptocurrencies.

It acts as a primary money launderer for Hamas, and has also laundered money for PIJ.

Herzallah Exchange is owned by Muhammad Fallah Kamil Herzallah, Naim Kamil Raghib Herzallah and Salah Kamil Raghib Herzallah. Muhammad has facilitated the transfer of cash, while Salah acts as the financial manager of Herzallah Exchange.

Gaza-based Samir Herzallah and Brothers For Money Exchange and Remittances has also worked with Hamas to facilitate money transfers for the group, according to the Treasury.

It has facilitated millions of dollars worth of fund transfers from around the region for Hamas since at least 2014.

Gaza-based financial facilitator Thair Abd al-Raziq Shukri Herzallah has previously coordinated transfers of millions of dollars to Türkiye, and has handled financial transactions for both Hamas and PIJ.

Thair has worked with al-Ayy and Hamas financial official Fawaz Mahmud Ali Nasser, who was designated in August 2019 for providing support to Hamas.

"Iran and its proxies have sought to abuse regional economies and use seemingly legitimate businesses as cover for funding and facilitating their attacks," said the US Treasury's Nelson.

"The United States will continue to disrupt Iran's illicit activities aimed at undermining the stability of the region," he said.