Will Federal Prosecutors Open a Second Front on Hamas?

Even as the Israel Defense Forces are hunting Hamas at Gaza, lawyers at Manhattan, half a world away, are reportedly readying a case against the terrorist outfit. Semafor reports that prosecutors at the Southern District of New York are “racing to build a case against Hamas.”That, Semafor’s editor, Ben Smith, writes, comes from “two people familiar with the case but not directly involved in it.” They divulge that the focus has been fixed on the group’s byzantine finances. Dozens of FBI agents and lawyers are reportedly involved in developing the case.The possibility of a criminal case against the group that perpetrated the atrocities of October 7 brings into sharp relief the scale of the challenge in bringing Hamas to heel or extirpating it outright. While Israel has dedicated itself to dismantling the group at Gaza and eliminating its leaders across the globe, laying hands on its bank accounts is another matter altogether. Hamas’s reserves are considerable. The Department of State estimates that Iran supplies Palestinian groups, including Hamas, with $100 million annually. A New York Times investigation discloses that a private equity firm used by Hamas to finance its operations held, at its peak, more than half a billion dollars, with investments across Sudan, Turkey, the United Arab Emirates, and Algeria.In 2016, the Mossad shuttered a terrorism-finance investigative team, code-named “Task Force Harpoon.” The one-time chief of the Mossad’s economic warfare division, Udi Levy, told the Times, “Everyone is talking about failures of intelligence on October 7, but no one is talking about the failure to stop the money. It’s the money — the money — that allowed this.”It now appears as if a United States attorney, Damian Williams, is set to do his part to “stop the money.” It would not be the first time the office took on terrorists. The perpetrators of the 1993 bombing of the World Trade Center were convicted by SDNY prosecutors, as was an arms dealer known as the Merchant of Death, Viktor Bout. He, though, was eventually exchanged, in a deal with President Putin, for a basketball player, Brittney Griner.Unless a Hamas head honcho finds himself on American soil, any SDNY prosecution is likely to focus on crimes like money laundering and financial fraud. Lower Manhattan prosecutors are well practiced in this kind of case — the conviction of the founder of FTX, Sam Bankman-Fried, comes to mind — as their jurisdiction includes Wall Street.How, though, can federal prosecutors reach a terror outfit rooted in the Middle East? One way could be by targeting its American enablers. A federal law passed after the first bombing of the World Trade Center prohibits persons from providing material support or resources they know will be “used in preparation for, or in carrying out” a terrorist attack.Another law, passed after the Oklahoma City bombing, prohibits persons from knowingly providing material support or resources to a designated “Foreign Terrorist Organization,” of which Hamas is one. Once designated, these organizations become “radioactive” to persons within America’s jurisdiction. A third law interdicts the provision or collection of funds with the “intention or knowledge that they are to be used, in full or in part, to carry out a terrorist attack.”Prosecutors could also turn to the “International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001,” a subsection of the “Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Patriot Act” that aims to make it more difficult for terrorists to launder money in America.If, though, prosecutors want to reach Hamas abroad, that could be more difficult. It would likely require some contact with an American entity or the presence of funds tied to the group in an American account or denominated in dollars. Should such a hook be found, civil suits could also be brought by families of Americans held hostage, injured, or killed by Hamas. In the northern district of Texas, a suit brought by America First Legal is moving forward against the Biden administration for allegedly transferring funds to the Palestinian Authority despite knowing that they would be used for terrorism. That suit is being brought by, among others, the parents of a West Point graduate, Taylor Force, who was murdered by a Palestinian terrorist at Tel Aviv. He has lent his name to the law, signed by President Trump, that slashed more than $200 million in funding from the Palestinian Authority and more than $300 million from the United Nations Relief and Works Agency, which has worked to stoke Palestinian Arab refugees’ hostility toward Israel.Reports that Hamas’s wallet is full of cryptocurrency will only make the task of prosecuting its finances more difficult, as that tender is notoriously difficult to track. In 2018, though, according to the Times, Israel recovered ledgers from a senior Hamas official. That information has been shared with the American government and could provide Mr. Williams with a place to start. The Southern District of New York did not return a request for comment by the time this article went to press.

Will Federal Prosecutors Open a Second Front on Hamas?

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