South Korea Uncovers First Terrorist-Linked Money Chain Involving Crypto-to-Physical Goods Exchanges; Four Uzbek Nationals Arrested

Gwangju Police Agency in South Korea announced today that it has arrested and indicted four Uzbek nationals on charges of allegedly providing funds to the UN-listed terrorist group Katiba Tawhid wal-Jihad (KTJ) via cryptocurrency. The four were arrested in April this year on suspicion of violating South Korea’s Act on the Prohibition of Funding Terrorism; one is the main suspect, who was previously listed on Interpol’s Red Notice. Police stated that between August 2024 and April 2025, the main suspect transferred a total of 4,267 USDT to KTJ through seven transactions. He is also suspected of receiving cryptocurrency from KTJ, using the funds to purchase 11 used cars and two excavators worth approximately 170 million won (around $121,000), before transporting the vehicles and equipment to Syria. The other three suspects are accused of assisting in procurement and export. South Korean police noted that previous terror-related cases mainly involved one-way fund transfers to terrorist groups, while this case marks the first discovery of a fund cycle model: "receiving cryptocurrency from a terror group and then returning it in the form of physical goods." The main suspect denied the core allegations, claiming the funds were used for household expenses and that he was unaware of the actual buyers of the vehicles.