N.Y. woman attempted to send bitcoin to Islamic State, feds say

By Ray Downs  |  Dec. 15, 2017 at 12:21 AM
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Dec. 15 (UPI) -- A New York woman was charged with several financial crimes in an effort to send bitcoin to the Islamic State, according to an indictment unsealed in federal court Thursday.

The U.S. Attorney's Office of the Eastern District of New York charged Zoobia Shahnaz, 27, with bank fraud, conspiracy to commit money laundering and three substantive counts of money laundering. Prosecutors said Shahnaz, "defrauded numerous financial institutions and obtained over $85,000 in illicit proceeds, which she converted to Bitcoin and other cryptocurrencies.  She then laundered and transferred the funds out of the country to support the [Islamic State]."

"As alleged, the defendant Zoobia Shahnaz engaged in a bank fraud scheme, purchased bitcoin and other cryptocurrencies and laundered money overseas, intending to put thousands of dollars into the coffers of terrorists," Acting United States Attorney Rohde said in a statement.

Prosecutors said Shahnaz, a U.S. citizen, lied to obtain a $22,500 loan and fraudulently applied for more than 12 credit cards to buy Bitcoin and other currencies over the internet.

"She then engaged in a pattern of financial activity, culminating in several wire transactions, totaling over $150,000, to individuals and apparent shell entities in Pakistan, China and Turkey," prosecutors said.

Shahnaz is not being charged with terrorism-related crimes. But she faces up to 30 years for the bank fraud charge and 20 years on each money laundering count.

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