Hamas' Financial Network: Complex Strategies and Growing Challenges

Hamas, the Palestinian group that governs the Gaza Strip, has long been known for its ability to navigate a complex web of financial networks. These networks serve the dual purpose of supporting its activities while also helping it evade international sanctions. However, recent actions by Israeli authorities and heightened international scrutiny are making it increasingly challenging for the group to access and move funds.

A recent move by Israeli police garnered attention when they froze a Barclays bank account believed to be linked to Hamas fundraising and blocked cryptocurrency accounts used for gathering donations. Although specific details about the extent of these actions remain undisclosed, they offer a glimpse into the intricate financial system that underpins Hamas.

Hamas maintains a substantial budget, estimated at over $300 million, primarily derived from a combination of sources. These sources include taxes on businesses, financial aid from countries like Iran and Qatar, and contributions from various charitable organizations. The U.S. State Department has also pointed out that Hamas raises funds in Gulf countries and receives donations from Palestinians, expatriates, and its own charities.

One notable aspect of Hamas' financial strategy has been its use of cryptocurrencies. Cryptocurrencies have been seen as an effective tool for evading financial restrictions. However, earlier this year, Hamas announced it would distance itself from cryptocurrencies due to financial losses, with the main reason being the traceability of cryptocurrency transactions. Despite this setback, experts acknowledge that Hamas has been one of the more successful users of cryptocurrencies for financing terrorism.

Recent reports indicate that Hamas had a surge in cryptocurrency fundraising after bouts of violence in the region. For example, after the fighting in May 2021, cryptocurrency addresses associated with Hamas received more than $400,000. However, since the recent escalation in violence, Hamas-linked support groups have only managed to move a relatively small amount through cryptocurrency. Israeli authorities have been targeting these activities, having seized cryptocurrency worth "tens of millions of dollars" from Hamas-linked addresses in recent years.

Hamas' allies, including Iran and Qatar, have utilized various methods to send funds to Gaza. Iran is reported to provide up to $100 million annually in support to Palestinian groups, including Hamas. They employ a range of tactics, such as shell companies, shipping transactions, and investments in precious metals. The Iranian government has not responded to requests for comment regarding these allegations.

On the other hand, Qatar has been a significant financial supporter of Gaza, having sent hundreds of millions of dollars since 2014. To facilitate this aid, Qatar's funds pass through Israel. Funds are electronically transferred from Qatar to Israel, where Israeli and U.N. officials hand-carry cash over the border to Gaza. The cash is then distributed directly to needy families and public servants in Gaza, with a comprehensive system of verification involving Israel, the U.N., and the U.S.

Despite the efforts to restrict Hamas' access to formal financial channels, experts predict that the group will continue to find ways to circumvent these measures. Hamas has a history of adapting its financial strategies to respond to challenges, and with the recent upheaval in the region and increased international scrutiny, the financial networks of Hamas are coming under greater scrutiny. The group's ability to sustain its operations amidst these challenges remains a topic of ongoing concern for international authorities.

By fLEXI tEAM