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Israeli safety officers scored a significant intelligence coup in 2018: secret paperwork that laid out, in intricate element, what amounted to a non-public fairness fund that Hamas used to finance its operations.
The ledgers, pilfered from the pc of a senior Hamas official, listed belongings price tons of of hundreds of thousands of {dollars}. Hamas managed mining, hen farming and street constructing firms in Sudan, twin skyscrapers within the United Arab Emirates, a property developer in Algeria, and an actual property agency listed on the Turkish inventory change.
The paperwork, which The New York Occasions reviewed, have been a possible street map for choking off Hamas’s cash and thwarting its plans. The brokers who obtained the data shared them inside their very own authorities and in Washington.
Nothing occurred.
For years, not one of the firms named within the ledgers confronted sanctions from the US or Israel. No one publicly referred to as out the businesses or pressured Turkey, the hub of the monetary community, to close it down.
A Occasions investigation discovered that each senior Israeli and American officers did not prioritize monetary intelligence — which they’d in hand — exhibiting that tens of hundreds of thousands of {dollars} flowed from the businesses to Hamas on the precise second that it was shopping for new weapons and making ready an assault.
That cash, American and Israeli officers now say, helped Hamas construct up its navy infrastructure and helped lay the groundwork for the Oct. 7 assaults.
“Everyone seems to be speaking about failures of intelligence on Oct. 7, however nobody is speaking concerning the failure to cease the cash,” mentioned Udi Levy, a former chief of Mossad’s financial warfare division. “It’s the cash — the cash — that allowed this.”
At its peak, Israeli and American officers now say, the portfolio had a price of roughly half a billion {dollars}.
Even after the Treasury Division lastly levied sanctions in opposition to the community in 2022, data present, Hamas-linked figures have been capable of get hold of hundreds of thousands of {dollars} by promoting shares in a blacklisted firm. The Treasury Division now fears that such cash flows will enable Hamas to finance its persevering with battle with Israel and to rebuild when it’s over.
“It’s one thing we’re deeply frightened about and anticipate to see given the monetary stress Hamas is beneath,” mentioned Brian Nelson, the Treasury Division’s beneath secretary for terrorism and monetary intelligence. “What we are attempting to do is disrupt that.”
That was what Israel’s terrorism-finance investigators hoped to do with their 2018 discovery. However on the high echelons of the Israeli and American governments, officers targeted on placing collectively a collection of economic sanctions in opposition to Iran. Neither nation prioritized Hamas.
Israeli leaders believed that Hamas was extra excited by governing than combating. By the point the brokers found the ledgers in 2018, the prime minister, Benjamin Netanyahu, was encouraging the federal government of Qatar to ship hundreds of thousands of {dollars} to the Gaza Strip. He gambled that the cash would purchase stability and peace.
Mr. Levy recalled briefing Mr. Netanyahu personally in 2015 concerning the Hamas portfolio.
“I can let you know for positive that I talked to him about this,” Mr. Levy mentioned. “However he didn’t care that a lot about it.”
Mr. Netanyahu’s Mossad chief shut down Mr. Levy’s workforce, Job Power Harpoon, that targeted on disrupting the cash flowing to teams together with Hamas.
Former Harpoon brokers grew so pissed off with the inaction that they uploaded some paperwork to Fb, hoping that firms and buyers would discover them and cease doing enterprise with Hamas-linked firms.
Within the years that adopted the 2018 discovery, Hamas’s cash community burrowed deeper into the mainstream monetary system, data present.
The Turkish firm on the coronary heart of the operation had such a sheen of legitimacy that main American and European banks managed shares on behalf of purchasers. The Church of Jesus Christ of Latter-day Saints invested tens of hundreds of {dollars} earlier than the corporate was positioned beneath sanction.
The Occasions reviewed beforehand undisclosed intelligence paperwork and company data and interviewed dozens of present officers from the US, Israel, Turkey and Hamas’s monetary community. Some spoke on the situation of anonymity to debate intelligence issues.
Israeli intelligence and safety companies have apologized for the failings that led as much as the Oct. 7 assaults.
Mr. Netanyahu has acknowledged that his authorities failed to guard its folks and mentioned that he would face, and reply, powerful questions after the battle. He has denied, although, that he took his eye off Hamas. However he declined to reply questions from The Occasions concerning the ledgers or the hunt for Hamas’s cash.
2015: Job Power Harpoon
Israeli safety and intelligence officers, working from a safe compound exterior Tel Aviv, spent years monitoring Hamas’s cash. By 2015, they have been on to what they referred to as Hamas’s “secret funding portfolio.”
Terrorist organizations like Al Qaeda and the Islamic State usually use entrance firms to launder cash. However right here, Israeli brokers noticed one thing completely different, extra formidable: a multinational community of actual companies churning out actual income.
On paper, they seemed like unrelated firms. However time and again, the Israelis mentioned they recognized the identical Hamas-linked figures as shareholders, executives and board members.
There have been folks like Hisham Qafisheh, a white-goateed Jordanian who studied in Saudi Arabia and had a knack for locating political assist. One in all his firms gained a $500 million freeway contract in Sudan.
Then there was Amer Al-Shawa, a Turkish man of Palestinian descent who studied electrical engineering in Ohio and extra just lately spent 5 months beneath interrogation in an Emirati jail on suspicion of funding Hamas.
On the high was Ahmed Odeh, a heavyset Jordanian businessman with years of expertise in Saudi Arabia. The Israelis discovered — and the Individuals now say a lot of this publicly — that Hamas’s governing Shura Council had given Mr. Odeh seed cash to construct and handle a portfolio of firms.
Hamas, the de facto governing physique of Gaza, relied principally on Iran to fund its navy wing. However Hamas needed its personal funding stream, too.
The Israeli safety companies operated a terrorism-finance investigative workforce on the time referred to as Job Power Harpoon. It put folks from throughout counterterrorism — spies, troopers, law enforcement officials, accountants, legal professionals — beneath the identical umbrella and gave them a direct report back to the prime minister. The duty drive even had an financial warfare unit inside the Mossad intelligence company that would covertly act on the intelligence it had gathered.
“We didn’t have any rivalries,” Tamir Pardo, the Mossad chief on the time, mentioned in an interview. “Nobody received credit score for anyone operation. It simply labored.”
Harpoon, he mentioned, was “one of the vital necessary instruments the Mossad had.” It churned out intelligence to monetary regulators, legislation enforcement companies, politicians and allies in Washington, serving to Israel win monetary sanctions focusing on Iran and its proxy, Hezbollah.
Mr. Levy, who ran Harpoon and its devoted financial warfare unit, recalled the primary time he heard about Hamas’s portfolio.
“One of many guys on my workforce, a Mossad man, confirmed it to me,” Mr. Levy mentioned. “What we understood then was that they’d these firms to make a little bit bit of cash and to make use of them as a authorized platform to switch cash from place to position.”
Again then, the consensus amongst Israeli officers was that Iran was the larger risk. It had nuclear ambitions and armed each Hamas and the Hezbollah militia in Lebanon. So the majority of the duty drive’s consideration remained targeted there.
Nonetheless, Mr. Levy mentioned the invention was sufficient of a “crimson flag” that he instructed Mr. Netanyahu about it.
2016: Shut Down
A 2014 battle between Israel and Hamas had left Hamas’s fortifications in ruins and its arsenal depleted.
Hamas, although, was capable of rebuild. In 2016, Israeli intelligence officers famous that the group was acquiring GPS jammers, drones and precision weapons, in response to a navy doc reviewed by The Occasions.
Hamas had added about 6,000 operatives to its ranks for the reason that battle ended, and the navy had discovered that Hamas was creating plans to storm Israeli communities and take hostages.
By 2016, Mr. Netanyahu’s authorities had begun pursuing a technique to include Hamas by permitting the Qataris to ship cash to Gaza. Mr. Netanyahu says that cash was humanitarian support. Privately, he instructed others that stabilizing Hamas would reduce stress on him to barter towards a Palestinian state.
That very same yr, the brand new Mossad chief, Yossi Cohen, dismantled Harpoon as a part of an company reorganization, in response to Mr. Levy and others.
Mr. Levy left authorities that yr. A brand new group of intelligence brokers and specialists from a number of different companies saved chasing the cash, solely with out the organizational construction and direct entry to senior policymakers.
This new group quickly made one other alarming discovery.
Up till that time, members of the workforce instructed The Occasions, they’d estimated that Hamas was taking about $10 million to $15 million yearly from their firms’ income.
Then they discovered, based mostly on sources and different intelligence, that Hamas had bought off a number of the secret portfolio’s belongings, elevating greater than $75 million. That cash, in response to an Israeli intelligence evaluation, was despatched to Gaza, the place it was used to rebuild Hamas’s navy infrastructure.
The Israeli authorities have now concluded that this inflow of cash not solely helped Hamas put together for the Oct. 7 assaults, however gave leaders confidence that they’d have the cash to rebuild afterward, in response to 5 Israeli safety officers.
Precisely how vital that cash was to the Oct. 7 assaults is unknown. Israeli officers have promised an inquiry into the intelligence failures that led as much as the assaults, and new particulars could emerge.
However what is evident is that the Israeli authorities took no public motion in opposition to the Hamas-linked firms. As an alternative, it determined to construct a case to get the US authorities to close the businesses off from the worldwide monetary system. However that will take time, and extra proof.
2018: The Massive Break
Precisely how Israeli intelligence obtained the ledgers — whether or not from an informant or a pc hack — stays unclear. However in 2018, the workforce received the proof it had been searching for.
The paperwork have been created by Mahmoud Ghazal, a person whom the Israelis had recognized because the Hamas portfolio’s bookkeeper.
The ledgers spanned 2012 to 2018 and contained entries and valuations for firms that the brokers had been monitoring in Saudi Arabia, Sudan, Turkey and elsewhere. The data additionally contained acquainted names, together with Mr. Qafisheh and Mr. Al-Shawa.
The paperwork have been arduous proof of what the Israelis had lengthy suspected: Regardless of what public data mentioned, Hamas was in management.
“It was an enormous breakthrough,” mentioned one official concerned within the investigation. “Hamas might conceal behind frontmen and shareholders, however the cash all the time talks.”
The ledgers additionally contained coded entries that puzzled investigators, however one doc was a form of Rosetta Stone: “QG” as an example, referred to Qitaa Ghaza, or the Gaza Strip. “D” referred to Daffa, or the West Financial institution. Beside every was a big greenback determine. From this, the Israelis deduced the place Hamas was sending its cash.
This discovery was shortly bolstered by intelligence from Saudi Arabia. In mid-2018, the Saudis arrested Mr. Ghazal, the Hamas accountant, and two different males who company data present held positions in 18 firms within the portfolio.
Underneath interrogation, Mr. Ghazal confessed that the portfolio existed to switch cash to Hamas, in response to data associated to the three males’s arrests that have been considered by The Occasions. He additionally mentioned that, simply because the Israelis had lengthy suspected, Mr. Odeh directed the place the cash went.
The 2 different males instructed their interrogators that they have been shareholders in title solely. Their stakes have been truly owned by Mr. Qafisheh, the goateed Jordanian who had additionally been on the Israeli radar display screen for years. Mr. Qafisheh, the lads mentioned, was a Hamas operative.
The paperwork don’t say what the Saudis did to elicit the confessions. The dominion’s harsh interrogation strategies have earned it worldwide condemnation.
The Saudis shared the supplies with Washington, in response to officers with direct information of the matter, figuring out that Washington would share them with its shut ally Israel. The Saudi monarchy has no tolerance for Hamas and hoped that Washington would blacklist the businesses, the officers mentioned.
The Israeli workforce shared the ledgers and its intelligence with American officers in early 2019, hoping to encourage monetary sanctions.
However then, nothing.
The Trump administration didn’t act. Treasury Division officers mentioned that they didn’t delay any choices. Issuing sanctions, they mentioned, is an advanced course of. And Israel, which was extra targeted on getting the Individuals to situation Iranian sanctions, didn’t press for extra pressing actions, each Israeli and American officers say.
“We’ve nice folks nonetheless who’re making an attempt to do that work,” Mr. Levy mentioned. “But when nobody at a excessive degree is placing this as a precedence, what can they do?”
2019: Turkey
Although the funding portfolio spanned many international locations, Turkey was key.
The Saudis had made clear with their arrests that Hamas was not welcome. And the financiers had misplaced a lot of their Sudanese earnings with the autumn of the autocratic chief Omar al-Bashir.
Turkey beneath President Recep Tayyip Erdogan, nonetheless, has not criminalized Hamas nor has it clearly restricted Hamas’s actions in Turkey.
By 2019, Mr. Odeh was in Turkey, as was Mr. Qafisheh.
Mr. Al-Shawa, the Ohio-educated engineer who had been in Israel’s sights for years, spent 135 days in Emirati jails earlier than being launched in 2015 — with out rationalization “and with out breakfast,” he instructed The Occasions in an interview. He returned to Turkey.
Mr. Erdogan was a significant proponent of the nation’s constructing trade, which was excellent news for the corporate on the heart of the Hamas portfolio: an actual property developer named Development GYO.
Development took benefit of Mr. Erdogan’s constructing increase. It introduced in an investor, Hamid Al Ahmar, with ties to the president. And it reorganized itself as an actual property funding belief, which had Turkish tax benefits, and went public.
Development’s basic supervisor, Mr. Al-Shawa, mentioned he had no actual energy on the firm. The board, he mentioned, made the entire choices. He denied being concerned with Hamas, however he mentioned that he suspected others at Development have been.
“Do I’ve proof? No. However typically you simply have a sense,” he mentioned. “I actually didn’t care. Why ought to I? I used to be there to earn money.”
Mr. Odeh and Mr. Al Ahmar declined to remark by means of intermediaries. Development wouldn’t move messages searching for remark to Mr. Qafisheh, and a spokeswoman mentioned he and Mr. Al Ahmar have been not concerned with the corporate. The spokeswoman mentioned the query of whether or not Hamas owned the corporate was “ridiculous and meaningless.” She mentioned Development was interesting its Treasury designation. Hamas, by means of its media workplace in Lebanon, declined to remark.
International buyers piled in. In 2019, whereas Washington sat on the ledgers, American and European banks held greater than 3 p.c of the corporate’s publicly traded shares on behalf of purchasers, Turkish monetary data present. The Church of Jesus Christ of Latter-day Saints’s funding arm, Ensign Peak Advisors, purchased greater than 200,000 shares.
There is no such thing as a indication that the church or the Western banks knew about any Hamas ties on the time. A church spokesman mentioned {that a} U.S.-based funding adviser, Acadian Asset Administration, purchased the shares on its behalf. An Acadian spokesman mentioned the corporate had “complied with all related legal guidelines.”
Whereas the sanctions proposal languished, Israeli and American officers now say, Hamas appointed a brand new funding chief, Musa Dudin. In contrast to his predecessors, he was a widely known Hamas navy operative who had spent 18 years in an Israeli jail for his function in lethal assaults.
Mr. Dudin, too, has resettled in Turkey. Mr. Dudin declined to remark by means of an middleman.
In the meantime, Hamas-linked homeowners started cashing out. In 2019, Mr. Qafisheh bought greater than $500,000 price of inventory, company filings present. In 2020, Mr. Al Ahmar bought shares price $1.6 million.
The corporate’s homeowners received cash out of the corporate one other method, too. Mr. Al-Shawa, in his interview, mentioned that the board pushed him to award Development contracts to a development firm that Mr. Qafisheh owned with two different Development shareholders.
Firm data present that Development paid that firm greater than $7.5 million from 2018 to 2022 — one instance of how Hamas-linked figures pulled money from the portfolio.
Development, in a written assertion, mentioned it had paid the development firm “in accordance with industrial practices and authorized guidelines” and not has a relationship with the corporate.
The Israeli brokers understood that Iranian sanctions would take priority over Hamas however have been pissed off by the delays. At their wits’ finish, former Job Power Harpoon members took a determined step. In June 2021, they uploaded a number of the Hamas monetary data to Fb. The paperwork revealed a number of nodes of the key community, together with Development. It’s unclear whether or not that was approved.
The objective was to create a path of on-line breadcrumbs for journalists, monetary investigators and others to observe. The Fb submit generated a smattering of reports protection.
“There wasn’t any method to make use of the intelligence we had,” mentioned Uzi Shaya, a former Mossad agent and Harpoon member. “It was nearly carried out as a final resort.”
Lastly, in Might 2022, the Treasury Division introduced monetary sanctions in opposition to what it referred to as an expansive Hamas funding community. Mr. Odeh and Mr. Qafisheh have been named as financiers.
“The US is dedicated to denying Hamas the flexibility to generate and transfer funds and to holding Hamas accountable for its function in selling and finishing up violence,” the division mentioned.
Development was financially blacklisted, as have been a number of different related firms.
All had been named within the ledgers that the Israeli workforce had given the Individuals three years earlier.
2023: Aftermath
Late final month, Mr. Nelson, the Treasury Division official, flew to Turkey to induce the Turkish authorities to cease sheltering Hamas’s cash.
“It’s the best precedence in our constructing,” he mentioned in an interview this month. The division just lately added Mr. Dudin, Mr. Al-Shawa and others to the monetary blacklist. Mr. Al-Shawa mentioned he was interesting the choice.
Mr. Erdogan has given no indication that he intends to acknowledge these sanctions. After the Oct. 7 assaults, he declared that Hamas was not a terrorist group, however a “liberation group.”
Individuals “are the one ones who set the legislation on this planet and all others observe,” Hasan Turan, a member of Parliament from Mr. Erdogan’s governing get together, mentioned in a current interview. “It isn’t acceptable.”
Mr. Turan even met with Mr. Al Ahmar, the previous Development investor, final month to debate methods to assist the Palestinians.
The worth of Development’s inventory, which remains to be traded on the Istanbul change, has greater than doubled because it was added to the sanctions checklist. Throughout that very same interval, two Development shareholders now beneath sanction bought $4.3 million in inventory, company filings present. Requested if that cash went to Hamas, the corporate’s chairman mentioned he didn’t know and it could be inappropriate to ask.
And as just lately as this yr, Hamas-tied firms and folks beneath sanction have been nonetheless capable of maintain Turkish financial institution accounts in U.S. {dollars}, banking data reviewed by The Occasions present, regardless of ostensibly being minimize off from the American monetary system.
Mr. Pardo, the previous Mossad chief, mentioned he didn’t know what occurred after he left in 2016. However “from the outcomes,” he mentioned, “you possibly can decide that they’d some huge cash.”
“I consider that if somebody would have chased the cash and stopped it,” he added, “we wouldn’t be seeing the outcomes of what we see right now.”
Mr. Levy, the previous Harpoon deputy, grows emotional when he talks concerning the Hamas cash. “I wish to do every thing we will to stop battle,” he mentioned. “I actually believed that we might do this by going after the monetary infrastructure of terrorist teams. However now we have to be severe.”
Ronen Bergman contributed reporting from Tel Aviv, and Patrick Kingsley from Jerusalem.
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