U.S. and Turkey Sanction ISIS Financial Network

U.S. and Turkey Sanction ISIS Financial Network

On January 5, the United States and Turkey sanctioned four Iraqi men and two Turkey-based companies for supporting ISIS financial activities in the Middle East. The network, led by ISIS official Brukan al Khatuni, facilitated ISIS recruitment and financial transfers. “Today’s action reaffirms Treasury’s commitment to degrade ISIS’s ability to operate globally,” Treasury Under Secretary for Terrorism and Financial Intelligence Brian Nelson said in a statement. “These designations and accompanying asset freezes are a result of close coordination and collaboration with our Turkish partners to target ISIS activity in the region.”

The United States named al Khatuni, his two sons, and another ISIS financial facilitator. They worked through two companies, Wadi Alrrafidayn for Foodstuffs and Sham Express, to transfer ISIS funds throughout the region. The move froze any assets under U.S. jurisdiction held by the men and firms and prohibited transactions with them. Turkey also froze assets held by the network.

The network was designated under Executive Order 13224, which President Bush signed following the 9/11 attacks in 2001. The order authorized the U.S. government to block the assets of foreign individuals and entities that commit, or pose a significant risk of committing, acts of terrorism. It also allowed designation for providing support, services, or assistance to terrorists. The following are statements from the State and Treasury Departments on the new sanctions.
State Department

The United States and Türkiye have disrupted ISIS’s ability to finance its operations by designating four individuals and two entities of an ISIS financial facilitation network. The United States designated members of the network pursuant to counterterrorism authorities that target terrorist groups and their supporters. Concurrently, Turkish authorities have implemented an asset freeze against members of this network.

The founder of the network, Brukan al-Khatuni; his two sons, Muhammad Abd Al Hamid and Umar Abd Al Hamid; and an ISIS financial facilitator, Lu’ay Jasim Hammadi al-Juburi, are being designated for providing support to the terrorist group. The four individuals facilitated money transfers to ISIS through their Türkiye-based financial entities, Wadi Alrrafidayn for Foodstuffs and Sham Express, both of which the United States also designated today. Wadi Alrrafidayn is designated for being controlled by Brukan al-Khatuni. Sham Express, set up to illegally transfer money on behalf of ISIS financial facilitators between Türkiye, Syria, and Iraq, is being designated for having materially assisted ISIS.

As a result of today’s action, all property and interests in property of the individuals and entities above, and of entities that are owned or controlled in the United States or by U.S. persons must be blocked and reported to OFAC.
Treasury Department

Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated critical nodes of a key financial facilitation network of the Islamic State of Iraq and Syria (ISIS), which included four individuals and two entities in Türkiye, who have enabled the terrorist group’s recruitment and financial transfers to and from Iraq and Syria. This network played a key role in money management, transfer, and distribution for ISIS in the region. Concurrently, the Turkish Ministry of Treasury and Finance, together with the Ministry of Interior, have implemented an asset freeze against members of this network.

“Today’s action reaffirms Treasury’s commitment to degrade ISIS’s ability to operate globally,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. “These designations and accompanying asset freezes are a result of close coordination and collaboration with our Turkish partners to target ISIS activity in the region.”

This follows OFAC’s November 7, 2022 designation of four individuals and eight companies as part of an ISIS cell in South Africa, which was providing technical, financial, or material support to the terrorist group. These individuals and entities are being designated pursuant to Executive Order (E.O.) 13224, as amended, which targets terrorist groups and their supporters.

ISIS FINANCIAL FACILITATOR BRUKAN AL-KHATUNI

Abd Al Hamid Salim Ibrahim Ismail Brukan al-Khatuni (Brukan al-Khatuni) is an Iraqi national illegally living in Türkiye, who has engaged in financial facilitation and recruitment activities for ISIS. Brukan al-Khatuni has played a significant role in transferring funds through his network in support of ISIS and ISIS senior leaders.

Brukan al-Khatuni has served as the head of foreign financing in ISIS’s so-called Wilayat al-Jazirah in Iraq. In 2016, Brukan al-Khatuni moved to Türkiye to manage ISIS’s financial facilitation network there and transferred funds from Arabian Gulf-based donors to ISIS. Also in 2016, Brukan al-Khatuni joined an ISIS recruitment cell, which was tasked with spreading the ideology of ISIS’s previous emir Abu Bakr al-Baghdadi.

As of 2018, Brukan al-Khatuni had assumed an important role in managing ISIS financing in Türkiye. That same year, ISIS transferred millions of dollars to Brukan al-Khatuni. Brukan al-Khatuni managed hawala offices and played roles in ISIS money management, transfer, and distribution.

In 2021, Brukan al-Khatuni sent funds to Yasir ‘Ali Ahmad Nuwayran al-Farraji, an ISIS cell member arrested by the Kurdistan Regional Government Counterterrorism Directorate on March 29, 2021 for planning attacks against Kurdish military and security forces in Erbil, Iraq. Al-Farraji later confessed to planning attacks in Erbil in a public statement on April 12, 2021.

Abd Al Hamid Salim Ibrahim Ismail Brukan al-Khatuni is being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material or technological support for, or goods or services to or in support of, ISIS.

AL-KHATUNI NETWORK

Muhammad Abd Al Hamid Salim Brukan al-Khatuni (Muhammad Abd Al Hamid) and Umar Abd Al Hamid Salim Brukan al-Khatuni (Umar Abd Al Hamid), Brukan al-Khatuni’s sons, coordinated with an ISIS finance official to facilitate the transfer of over $500,000 in June 2021. Muhammad Abd Al Hamid and Umar Abd Al Hamid were both affiliated with a money service business in Mersin, Türkiye, which Brukan al-Khatuni later re-branded as Wadi Alrrafidayn for Foodstuffs (Wadi Alrrafidayn). Brukan al-Khatuni and his sons all worked at Wadi Alrrafidayn.

Umar Abd Al Hamid Salim Brukan al-Khatuni, and Muhammad Abd Al Hamid Salim Brukan al-Khatuni are being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material or technological support for, or goods or services to or in support of, ISIS.

Wadi Alrrafidayn for Foodstuffs is being designated for being owned, controlled, or directed by, directly or indirectly, Brukan al-Khatuni.

Türkiye-based Sham Express, a company founded in 2020 by Brukan al-Khatuni, has also been used by ISIS-affiliated individuals to transfer funds for the group. Particularly, ISIS financial facilitator Lu’ay Jasim Hammadi al-Juburi (Lu’ay Jasim) used Sham Express to transfer money on behalf of ISIS between Türkiye, Syria, and Iraq.

Prior to his arrest in July 2021, then-ISIS finance leader ‘Abd-al-Rahman ‘Ali al-Ahmad al-Rawi (al-Rawi) established financial channels throughout Russia, Europe, China, and Africa to transfer existing ISIS funds and generate additional ISIS revenue. Al-Rawi worked with Sham Express in connection with these activities. Treasury designated al-Rawi pursuant to E.O. 13224 on April 15, 2019.

ISIS financial facilitators also used Sham Express to support the smuggling of gold from Syria and Sudan via Iraq, Egypt, and Libya to generate additional revenue for ISIS. Sham Express is being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material or technological support for, or goods or services to or in support of, ISIS.

Lu’ay Jasim, previously an al-Qa’ida member since 2008, joined ISIS in 2014 and worked in ISIS’s financial administration for several years until he moved to Mersin, Türkiye, where he managed a business used by ISIS members in Türkiye to illegally transfer funds throughout the region, notably Iraq and Egypt.

Lu’ay Jasim Hammadi al-Juburi is being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material or technological support for, or goods or services to or in support of, ISIS.

SANCTIONS IMPLICATIONS

As a result of today’s action, all property and interests in property of the persons named above, and of any entities that are owned, directly or indirectly, 50 percent or more by them, individually, or with other blocked persons, that are in the United States or in the possession or control of U.S. persons, must be blocked and reported to OFAC. Unless authorized by a general or specific license issued by OFAC or otherwise exempt, OFAC’s regulations generally prohibit all transactions by U.S. persons or within the United States (including transactions transiting the United States) that involve any property or interests in property of designated or otherwise blocked persons. The prohibitions include the making or receiving of any contribution of funds, goods, or services to or for the benefit of those persons.

Furthermore, engaging in certain transactions with the persons designated today entails risk of secondary sanctions pursuant to E.O. 13224, as amended. Pursuant to this authority, OFAC can prohibit or impose strict conditions on the opening or maintaining in the United States of a correspondent account or a payable-through account of a foreign financial institution that has knowingly conducted or facilitated any significant transaction on behalf of a Specially Designated Global Terrorist (SDGT).

The power and integrity of OFAC sanctions derive not only from its ability to designate and add persons to the List of Specially Designated Nationals or Blocked Persons (“SDN List”), but also from its willingness to remove persons from the SDN List consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, please refer to OFAC’s Frequently Asked Question 897. For detailed information on the process to submit a request for removal from an OFAC sanctions list.

Source: wilsoncenter