US Lawmakers Introduce Bill to Prevent Terror Organizations from Accessing Financial Aid
A group of bipartisan United States lawmakers have presented a bill to the Senate with the aim of blocking terror organizations and their financial supporters from accessing financial aid in fiat and digital assets within the country. The bill, known as The Terrorist Financing Prevention Act of 2023, expands sanctions to include foreign corporations that back US-designated terror groups through financing and other means. This includes both traditional finance companies and digital asset firms. The proposed law seeks to impose strict regulations and sanctions on these activities, preventing Foreign Terrorist Organizations and their financial enablers from accessing US financial institutions.
Prohibiting and Banning Foreign Institutions
The draft law outlines measures to ban or impose strict liabilities on firms found guilty of terror financing. It states that the President will impose strict conditions for opening an account payable in the US by organizations involved in these offenses. Additionally, any transaction between a financial facility and a proscribed institution through digital assets will be prohibited according to the law. The implementation of the Act will follow the International Emergency Economic Powers Act, including punishments for those who violate it. Within 60 days of enactment, the Secretary will submit to the President a list of groups or financial institutions that have facilitated terror transactions.
Terror Organizations and Crypto Funding
Authorities have expressed concerns about the potential use of cryptocurrencies to fund terrorist activities due to the lack of regulations in certain jurisdictions and ease of access. Following attacks on Israel, it was reported that Hamas received $41 million through crypto between August 2021 and June 2023, sparking outrage in the crypto community. However, Chainalysis has disputed these claims, stating that metrics and analyses of terrorist groups’ use of cryptocurrency are often overstated. Chainalysis also emphasized that blockchain technology’s transparency does not make it an effective method for financing terror activities.
Hot Take: US Lawmakers Take Action to Combat Crypto Terror Financing
A group of bipartisan lawmakers in the United States has introduced a bill aimed at preventing terror organizations and their financial enablers from accessing financial aid through fiat and digital assets. The bill expands sanctions to include foreign corporations supporting US-designated terror groups, both in traditional finance and digital asset sectors. By imposing strict regulations and sanctions, the proposed law seeks to counteract these activities and prevent Foreign Terrorist Organizations from accessing US financial institutions. This move comes as concerns grow about the potential use of cryptocurrencies for funding terrorism. While some reports suggest significant sums have been transferred, experts argue that these claims may be exaggerated, emphasizing that blockchain technology’s transparency is not conducive to financing terror activities.
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