South African Authorities Arrest Man Accused of Using Bitcoin to Fund Terrorist Activities

Man Accused of Terror Funding Arrested in Johannesburg

South African law enforcement has apprehended a 35-year-old man in Johannesburg for allegedly using cryptocurrency, specifically bitcoin, to fund terrorist activities. The Directorate for Priority Crime Investigation (known as the Hawks) conducted the arrest after a multi-year investigation into the suspect's financial transactions.

Suspicious Transactions and Initial Findings

The probe, which began in May 2018, was initiated after the Financial Intelligence Centre (FIC) and the Hawks flagged unusual financial activity linked to terror funding. According to Philani Nkwalase, a Hawks spokesperson:

“Cryptocurrency in the form of Bitcoin worth $614 (ZAR11,500) was allegedly purchased through Luno, a virtual asset service provider (VASP), via transfer of money from the suspect’s bank account to Luno’s custody account on Nov. 30, 2017.”

The bitcoin was later transferred to a wallet associated with an unnamed "independent" organization. Preliminary investigations revealed that the funds were used to support international participants involved in terror activities, including supplying weapons, financial aid, and other logistical support.

Search and Seizure Operations

On Oct. 24, South African authorities raided the suspect’s home in Johannesburg with a search warrant. During the operation, law enforcement seized various materials, including improperly stored firearms, which violated South African firearm regulations.

Collaboration to Combat Terror Financing

Godfrey Lebeya, the head of the Hawks, emphasized the importance of local and international collaboration in dismantling networks that enable terrorism.

"Our team is working closely with local and international agencies to halt the illicit flow of funds that fuel organized crime and terrorism," Lebeya stated.

Legal Proceedings

The suspect is set to appear in the Lichtenburg Magistrate’s Court on Jan. 6, 2025. He faces charges under the Protection of Constitutional Democracy and Related Activities Act, among others.

Global Implications

This case highlights the evolving challenges posed by cryptocurrencies in financial crime. While bitcoin and other digital currencies offer numerous legitimate uses, they are also exploited for illicit activities. Law enforcement agencies worldwide are increasingly scrutinizing cryptocurrency transactions to prevent their misuse in organized crime and terrorism.