Crypto Laundering Scandal Leads To New York’s First Terrorism Financing Case

Manhattan District Attorney Alvin Bragg announced on Tuesday the indictment of a woman living on the Upper East Side in Manhattan, New York for using cryptocurrency to finance terrorism groups in Syria.

Victoria Jacobs, also known as Bakhrom Talipov, has been indicted on charges that include soliciting or providing support for an act of terrorism and money laundering for her alleged coordination of payments made to a company described by Foreign Policy as the “first jihadi private military contractor.” The payments were allegedly disguised and laundered through cryptocurrency exchanges. 

“This case marks the first time that terrorism financing is being prosecuted in New York State Court and is one of the rare cases worldwide where cryptocurrency is alleged to have financed terrorism,” Bragg said.

Court documents from 2018 and 2019 describe giving more than $5,000 to the terrorist training group and PMC Malhama Tactical while she was living in New York. 

The organization is known to have fought along with and provided tactical and military training to Hay’at Tahrir al-Sham, an organization the U.S. State Department designated as a foreign terrorist group back in 2018. 

Jacobs allegedly laundered $10,661 for the terrorist training group, receiving funds through cryptocurrency exchanges and Western Union and MoneyGram wires from supporters around the globe and transferring them to Mahalma Tactical’s bitcoin wallets. Jacobs is also accused of purchasing Google Play gift cards on behalf of Malhama Tactical.

Aside from money and digital currency, in December 2019, Jacobs gave a U.S. Army Improvised Munitions Handbook to an online organization Jacob’s purportedly believed to be associated with multiple known terrorist groups including Hay’at Tahrir al-Sham and al-Qaeda affiliated Jihadist group Hurras al-Din. 

According to the prosecution, investigators in August 2021 uncovered weapons purchases including military-style combat knives, metal knuckles and throwing stars bought on Malhama Tactical’s behalf. At that time, Jacobs was allegedly describing herself on forums affiliated with Hay’at Tahrir al-Sham as “behind enemy lines.”

Jacobs reportedly asked for prayers on the online forums and “courage, strength, guidance and wisdom to carry out certain missions.”

Although this is the first time terrorism financing is being prosecuted in New York State Court, terrorists have been prosecuted in New York before. 

More recently, last Thursday, Shaikh Abdullah Faisal was convicted of recruiting and providing support for the Islamic State’s acts of violence and terrorism. He was indicted for soliciting or providing support for an act of terrorism in the first degree among other charges. Faisal will be sentenced in early February. 

In New Jersey, a 55 year old named Maria Bell was sentenced last week to 34 months in prison for trying to provide material support and resources to Hay’at Tahrir al-Sham, the same organization Jacobs has been accused of providing support to through Malhama Tactical and her online coordination. Bell also gave support to another Syrian terrorist organization called Jabhat Fath al-sham.

Bell pleaded guilty in a Newark federal court to one count of concealing attempts to provide material support to designated foreign terrorist organizations. Bell confessed to investigators that she knowingly concealed support and resources provided to Syria-based fighters affiliated with terrorist organizations, and that she knew they were designated foreign terrorist organizations at the time.