US Treasury's Adeyemo sees more actions against Hamas in coming days, weeks

U.S. Deputy Treasury Secretary Wally Adeyemo told Reuters NEXT on November 9 that the US and its allies in the coming days and weeks will impose more sanctions to deny funds to Hamas after its attack last month on Israel, including cracking down on its use of crypto assets.

"We're going to see actions taken by our allies and partners," Adeyemo said. "Some of them will be publicly announced, some of them people will not see in terms of shutting down charities or going after individuals who may be helping to facilitate payments for Hamas."

Since the Palestinian militant group's deadly October 7 attack on Israel, Washington has imposed two rounds of sanctions on Hamas. It has targeted the group's investment portfolio and issued an alert to financial institutions on countering Hamas financing while senior officials have discussed the group's access to funds on trips abroad.

Separately, the Treasury's top sanctions official, Brian Nelson, on Thursday met with the private sector, including cryptocurrency firms and payment processors, on countering Hamas's fundraising techniques.

Nelson, the Treasury Under Secretary for Terrorism and Financial Intelligence, heard from the money service businesses, payment processors and blockchain analytic companies on techniques used by the militant group to raise and move funds, the department said in a statement.

Nelson "pledged continued engagement with those who have taken proactive steps to investigate, identify, and disrupt Hamas-related activity," the Treasury said.

Adeyemo said that while crypto was not where the majority of Hamas' assets come from today, "Over time, if the crypto industry doesn't put in place safeguards, and take seriously their anti-money-laundering responsibilities, Hamas and others will grow in their use of cryptocurrency."

This was part of the motivation behind the Treasury-run Financial Crimes Enforcement Network's (FinCEN) proposing a rule under Section 311 of the anti-terrorism USA Patriot Act to designate cryptocurrency "mixing" transactions as of primary money laundering concern, requiring financial institutions to monitor and report them.

Such transactions combining pools of assets or delaying transaction processing can hide the beneficial ownership of crypto assets, Adeyemo said.

Adeyemo said the efforts to cut off Hamas funding will increasingly focus on facilitators in third countries, and it will take coordination with allies and partners to shut off those avenues. His recent trip to Europe centered on fostering more cooperation in this area.

"What I want those who seek to harm Israel or harm the region or to harm us to know, is that we're going to continue to act as long as you act, to cut off your access to financing," Adeyemo said.