Its financial framework is complex and opaque, and its roots extend far beyond the Gaza Strip.
Hamas, considered a terrorist organization by the United States and the European Union, is a financial pariah, subject to sanctions for decades and without access to the international banking system.
However, as it was able to demonstrate on October 7 when it made a surprise attack on Israel with thousands of rockets, drones and other technological equipment, the militant group does not appear to be short of resources.
How do you manage to finance yourself?
Hamas is an Islamist movement founded in 1987 that has a political branch and a military branch.
Their armed movement, known as the Ezzedin al Qassam Brigades, has carried out numerous attacks and suicide bombings against Israel in the past.
But it also governs and administers a territory in which More than 2.3 million people live there, and it is responsible for some 50,000 officials.
As a political and social organization, it collects taxes and receives international aid from like-minded foreign governments and charitable organizations, but – as the October 7 attacks demonstrate – it has also been able to access military hardware.
The Islamist group also has an obscure international investment portfolio that often uses cryptocurrencies as a vehicle to circumvent international sanctions.
Qatar
The small Gulf nation, one of the richest countries in the world, was one of the few governments that, along with Turkey, supported Hamas after the brutal break with Fatah in 2007. When Israel imposed a blockade on Gaza that same year , Qatar decided to support the Palestinians in the Strip with humanitarian aid.
In 2012, Sheikh Hamad bin Khalifa al Thani, then emir of Qatar, was the first head of state to visit Gaza under Hamas rule, and He promised millions of dollars in aid, which was finally approved by Israel.
Qatar offers, according to analysts, political support to Hamas by allowing its leaders to settle in Doha since 2012 after they had to abandon their historic headquarters in Damascus due to the Syrian civil war.
Both Ismail Haniya, considered the leader of the organization, and Khaled Meshaal, his predecessor, are based in the Qatari capital, as were the Taliban leaders until they regained control of Afghanistan in the summer of 2021.
The emirate has thus become a key piece in the negotiations with groups that Western powers consider terrorists and their legislation – and public opinion – do not allow them to negotiate directly.
This role of intermediary between Hamas and Israel, which Egypt has traditionally played, is now played primarily by Qatar, as is currently the case with the Israeli hostages kidnapped by the militant group.
Qatar, which is one of the main US allies outside NATO, has also sent billions of dollars in humanitarian aid to the Palestinians over the years to alleviate the consequences of the Israeli blockade on Gaza. Doha insists that this money is for the Palestinians, not Hamas.
It is not clear how much this aid amounts to, which analysts place between US$1,000 and US$2,600 million since 2014, and which has helped in the reconstruction of the Strip after the numerous wars with Israel.
In 2016, the Emir of Qatar, Sheikh Tamim bin Hamad Al Thani, announced that his country would allocate 113 million Qatari reals (about US$30 million) to “alleviate the suffering of the brothers in the Strip and the serious financial difficulties they face due to the unjust siege imposed on them by the Israeli occupation.”
This money, which was paid monthly, made it possible to pay part of the salaries of the nearly 50,000 Gazan officials, buy fuel to feed the Strip’s electrical grid, and help the poorest families, who have received a monthly check of US$100.
The funds are transferred in coordination with the US and Israel, Khaled el Hroub, professor of Middle Eastern Studies at Northwestern University in Qatar, explains to BBC Mundo.
“The dollars that arrive in the Palestinian territories, including Gaza, They are possibly the most watched in the worldsince both the American and Israeli secret services, the Jordanians and the Egyptians, monitor these amounts very closely, since some money arrives through their banks,” says the Palestinian analyst, author of several works on Hamas.
That money is transferred from Doha to Israel and has long entered Gaza in briefcases full of bills that transported Qatari envoys through the Erez Pass, north of the Strip. The money was distributed through post offices and supermarkets directly to officials and humble families upon receipt.
Israel and the United States accepted these payments because the idea was “that if the problem (of Hamas and Gaza) couldn’t be solved, it could at least be mitigated,” says Matthew Levitt, an analyst at the Washington Institute for Near East Policy.
According to this anti-terrorism and intelligence specialist, the idea was that “if economic opportunities were offered, things would calm down, but this was later proven to be a mistake.”
For Makram Khoury-Machool, director of the Cambridge Center for Palestine Studies, Israel accepted the transfer of the funds “because (Prime Minister) Benjamin Netanyahu is against a two-state solution, like Hamas, and to avoid any type of from solution, keeping Hamas in Gaza and prolonging internal Palestinian division”.
According to Levitt and other analysts in the US and Israel, some of that international aid money ends up in the hands of the armed wing of Hamas, something that Fatah, the rival Hamas party that leads the Palestinian National Authority, also does. has accused the Islamist group in the past.
Hamas has always denied this.
“It is not clear how much, but no one who studies the matter doubts it,” Levitt, who in the past has advised the US Treasury on terrorist financing issues, told BBC Mundo.
But Khaled el Hroub assures that there is no proof of this:
“Hamas’s main economic problem is not financing the party or its armed wing, that’s almost the easy part. The most difficult thing is to support the millions of Palestinians in Gaza “They are suffering, and Hamas feels that pressure.”
Qatari money and international aid, the Palestinian analyst maintains, “has long been seen almost as a painkiller, treating the symptoms but not the root of the problem.”
The main humanitarian aid organization in Gaza is UNRWA, the United Nations Agency for Palestine Refugees in the Middle East. Their aid is distributed directly by their teams, which have passed prior controls, a UNRWA spokesperson explains to BBC Mundo.
The agency is also subject to annual audits carried out by an independent body. “All payments to contractors, suppliers and staff are processed through a banking entity, which is subject to the regulations on Counter-Terrorist Financing,” explains the spokesperson.
Iran
Hamas is one of the groups that form an alliance known as the Axis of Resistance, which is led by Iran and which also includes, among others, Syria and the Lebanese Islamist group Hezbollah. Their main common factor is their anti-Israel and anti-American sentiment.
To contain Israel’s influence and ensure the very survival of the Ayatollahs’ government, Tehran has helped weave a network of allies in the regionwhom it helps with “financing, training or weapons,” analyzes Sanam Vakil, director of the Middle East and North Africa program at Chatham House, in a recent article published by the think tank.
Among them are Hamas and other Palestinian resistance groups, whom Iran has increasingly supported since the 1990s, according to Vakil.
This support translates, according to the US Department of State, into US$100 million annually that go to Hamas, Islamic Jihad and the Popular Front for the Liberation of Palestine.
Although Hamas and Iran had their differences during the Syrian civil war, when the Palestinian group refused to support Bashar al Assad, “Iran’s funding never stopped, maybe they cut some for political activities, but the funds for the armed group continued,” says Matthew Levitt.
According to Khaled el Hroub, “it is not clear how much money Hamas receives from Iran annually, but it clearly receives funding.”
The leader of Hamas himself, Ismail Haniya, acknowledged in 2022 in the program “Al Muqabla” (the interview) on the Al Jazeera channel, that Iran is its main donor and has contributed US$70 million to the development of its missile systems.
More recently, in an interview on the Russian channel Russia Today the day after the Hamas attack on Israel, Ali Baraka, head of Hamas foreign relations, assured that “the first and foremost” of their donors is Iran, which provides them with “money.” and weapons.”
The BBC did not receive a response from the Iranian Foreign Ministry about Tehran’s alleged financing of Hamas.
Hamas, as ruler of Gaza, collects taxes on imports – including those smuggled through the tunnels with Egypt – and on other commercial activities in the Strip.
It is unclear how much money Hamas collects monthly through taxes. The figure varies from the US$15 million that the Gaza Ministry of Finance recognized in 2016 to the BBC’s correspondent in Gaza, Rusdi Abu Alouf, to the US$300-450 million that analysts such as Matthew Levitt cite.
What is clear is that Gaza, where according to the UN there is a unemployment rate of 45% and 80% of its population required humanitarian aid before the war, It is subject to a fairly high tax level.
“Gaza and the West Bank are governed by the same bureaucracy, even though income levels are very different,” says Khaled al Hroub. Added to this are other taxes that Hamas has been adding over the years “to compensate for the blockade”, such as taxes on cigarettes, the import of jeans, vehicles or certain food products considered luxury or non-basic, according to the Northwestern University professor.
For Levitt, “when you charge taxes for everything, and more and more, in the end it is extortion, a mafia practice.”
Increasing taxes and tariffs have generated a unrest among the populationand even some protests among importers, which have been repressed by Hamas.
Investment portfolio
According to the US Department of the Treasury’s Office of Foreign Assets Control (OFAC), Hamas has an internal Investment Office. national with assets estimated at US$500 million.
This network would have companies in countries such as Sudan, Turkey, Saudi Arabia, Algeria and the United Arab Emirates, according to OFAC, which considers that the Shura Council and the Executive Committee of Hamas, its top leaders, control and supervise this portfolio of investments.
OFAC last year published a list of Hamas officials, facilitators and companies that “had been used by Hamas to hide and launder funds.” Washington considers Hamas a terrorist organization and penalizes anyone who operates with them.
Among the companies cited by the US, there is a Sudanese mining holding company, a Turkish real estate company and a Saudi construction company.
Last month, the same office announced a second round of sanctions that includes the Hamas representative in Tehran and members of the Iranian Revolutionary Guard.
Cryptocurrencies and donations
Hamas also depends for its financing on donations it receives from sympathizers in the Palestinian territories, Arab countries and beyond the region, says Khaled el Hroub.
These donations, often following the Islamic religious premise of “zakat””, or Zakah, the proportion of personal wealth that Islam calls for to be donated to help those in need, have helped fund Hamas.
Because it is a multifaceted movement, with different branches, when it asks for money through these unofficial funding sources, Hamas does not say that the money will go to finance its armed wing, “but rather that it asks for money for schools, hospitals. or political campaigns,” says the author of “Hamas: Political Thought and Practice” and “Hamas: A Beginners Guide.”
Al Hroub recalls that after the Second Intifada, when the US launched its “War on Terror” campaign to cut off funding to groups it considered terrorists, “Hamas managed to raise between US$1.5 and 2 million in a single day, after Friday prayers, in Gaza.”
When Hamas tries to raise money through charitable organizations “they don’t say that those funds are going to finance Hamas, but they put up a photo of a bloodied child,” argues Matthew Levitt, who estimates that “a large part of that money will end up being used for military purposes.”
Over the years, the US and other countries have censured various Islamist charities such as “Union of Good” for their alleged links to Hamas.
Since 2019, in addition, Some of these donations have been made through cryptocurrencies.
“Hamas was one of the first to use them or at least to ask that donations be in cryptocurrencies,” Ari Redbord, global head of policy and government affairs at TRM Labs, a blockchain intelligence technology company, tells BBC Mundo, who assures that The group first used Bitcoin and since 2022 especially the digital currency Tron.
Cryptocurrencies allow large amounts of money to be moved across borders much faster than conventional money transfers, and this makes the technology “very attractive to legal and illicit actors,” says Redbord.
However, this technology can be tracked in an increasingly sophisticated way, which has made governments such as Israel and the United States pursue cryptocurrency donations destined for Hamas with great efficiency.
According to TRM Labs, In 2020, the US Department of Justice confiscated 150 cryptocurrency addresses associated with Hamaswhich was raising funds on Telegram and on websites.
“Hundreds of other addresses have also been confiscated by Israeli authorities in recent years to the point that Hamas said in April 2023 that they were going to stop raising funds in cryptocurrencies because their donors were becoming targets,” says Redbord.
Although moments of violence are usually when donors mobilize the most, TRM Labs has not seen a jump in fundraising since last October 7, just about US$20,000.
“Cryptocurrencies are a very small piece in the terror financing puzzle,” says Ari Redbord.
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