Cryptocurrency being used to finance terrorism: CTTC

Highlights

• Cryptocurrencies are banned in Bangladesh
• 2 militants arrested in 2019 confessed using Bitcoin since 2014
• Ansar Al Islam, Ansarullah Bangla Team had been using Bitcoin for years
• Law enforcers cannot track such transactions, or the buyers and sellers
• There are many groups in Bangladesh who have been trading Bitcoin

Cryptocurrency – a digital or virtual currency secured by cryptography – is being used to finance militant activities in Bangladesh, sources from the Counter Terrorism and Transnational Crime (CTTC) of Bangladesh Police have said.

Militant groups had been collecting funds from abroad through illegal remittance, locally known as hundi. They later began relying on the mobile banking system for fund transfers, but this process can easily be traced by the law enforcing agencies.

So, banned militant groups in the country have switched to Cryptocurrency for fund collection, as the law enforcers cannot track such transactions, or the buyers and sellers.

According to a CTTC official, two militants arrested in September 2019 have confessed about receiving funds through Bitcoin – a popular cryptocurrency – from extremist groups since 2014.

The duo, Ansar Al Islam Awal Newaz alias Sohel Newaz and Fazle Rabbi Chowdhury, are members of the banned militant group Ansar Al Islam. During interrogation, they revealed that both the Ansar Al Islam and Ansarullah Bangla Team had been using Bitcoin for years to fund themselves.

The official said police had seized some electronic devices from the duo's possession during their arrest. After carrying out forensic examination of the devices, they found significant proof of cryptocurrency transactions.

Investigators also found that the militant group had received .002% of a Bitcoin through an account, which was around Tk10,000. Law enforcers learned about it through a messaging app conversation among the militants.

Commenting on the matter, CTTC's Additional Deputy Commissioner Ahmedul Islam told The Business Standard, "Ansar Al Islam had opened three channel in the Telegram app to carry out militant activities and collect funds.

"The channels are Fiamanillah Insaf, Fiamanillah Jihad and Fiamanillah El Jihad. They also used these channels to communicate with people."

He added that it is very tough to monitor any illegal transactions through Bitcoin and it will be a big challenge for the law enforcers to check the use of virtual currency in the future.

On 28 February, officials of the Anti-Corruption commission, Criminal Investigation Department (CID) and Bangladesh Financial Intelligence Unit (BFIU) held a meeting at the commission's headquarters in Dhaka on curbing terrorist financing and money laundering.

They also discussed the formulation of a policy in this regard. In the meeting the officials decided to include cryptocurrencies in the Risk Assessment Report.

Cryptocurrency is banned in Bangladesh. The Bangladesh Bank in December 2017 issued a notice asking the public to refrain from virtual currency transactions.

However, there are many groups in Bangladesh who have been trading Bitcoin.  The CID arrested a man who was involved with cryptocurrency trading and seized a mobile and laptop from his possession, said CID Inspector Ibrahim.

The CID – a specialised intelligence and investigation wing of the Bangladesh Police – as well as the Dhaka Metropolitan Police and other police units are said to be on the lookout for illegal virtual transactions in the country.