Crypto crime (financing terror, money laundering, fraud, ponzi, etc.)

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Let's see..........do I post this here or the crypto trading thread? WTF???

LONDON, Nov 27 (Reuters) - A new front has emerged in Israel's fight against the funding of Iran-backed militant groups from Hamas to Hezbollah: A fast-growing crypto network called Tron.

Quicker and cheaper than its larger rival Bitcoin, Tron has overtaken its rival as a platform for crypto transfers associated with groups designated as terror organizations by Israel, the United States and other countries, according to interviews with seven financial crime experts and blockchain investigations specialists.

Focus: New crypto front emerges in Israel's militant financing fight

A new front has emerged in Israel's fight against the funding of Iran-backed militant groups from Hamas to Hezbollah: A fast-growing crypto network called Tron.
www.reuters.com
 
TRON/TRX has held legal tender status in Dominica for just over a year now:

Dominica and St Maarten to adopt Tron as legal tender

Geneva, Switzerland — Jan. 25, 2023 — Tron may soon be officially adopted by the government of the eastern Caribbean island of St. Maarten. Member of Parliament (MP) Rolando Brison, the leader of the United People’s Party and second vice chairman of St. Maarten’s parliament, has been outspoken...
www.pmbug.com

It is an Ethereum clone/competitor and the 10th ranked crypto by market cap at $9.2B currently. It's large enough to be on the radar of folks wanting to move large sums of money around.


Tron (cryptocurrency) - Wikipedia

en.wikipedia.org
 
BERLIN, Nov 29 (Reuters) - Germany's Bitcoin Group (ADE.DE) said on Wednesday it was taking measures to improve its internal control system, after the financial regulator BaFin ordered its subsidiary futurum bank to remedy shortcomings on money-laundering and terrorist financing.

"The Bitcoin Group expressly points out that there are currently no indications of violations of money laundering and terrorist financing laws within the Group," the company said in a statement.

Bitcoin Group: taking steps against money-laundering, terrorist financing

Germany's Bitcoin Group said on Wednesday it was taking measures to improve its internal control system, after the financial regulator BaFin ordered its subsidiary futurum bank to remedy shortcomings on money-laundering and terrorist financing.
www.reuters.com
 
Nov 29 (Reuters) - The U.S. government will cut off cryptocurrency companies from the broader U.S. economy if they fail to block and report illicit money flows, Deputy Treasury Secretary Wally Adeyemo warned the industry on Wednesday.

Speaking at an event hosted by the Blockchain Association, Adeyemo said that crypto companies need to do more to curtail the flow of illicit finance, and that the lack of action across the sector presents a risk to the U.S.

US will be forced to curtail crypto if industry fails to act on illicit finance threats- official

The U.S. government will cut off cryptocurrency companies from the broader U.S. economy if they fail to block and report illicit money flows, Deputy Treasury Secretary Wally Adeyemo warned the industry on Wednesday.
www.reuters.com
 
A bipartisan group of U.S. senators including Mitt Romney (R-UT) introduced legislation that expands sanctions to foreign entities supporting all U.S.-designated terrorist groups, including through crypto transactions, giving law enforcement an additional toolkit to tackle terror financing.

Bipartisan Anti-Crypto Terror Financing Bill Heads to U.S. Senate

Legislation will crack down on terrorist organizations like Hamas by applying sanctions to foreign parties that facilitate financial transactions with terrorists.
www.coindesk.com
 
IceTeaTop's comment is dumb. Tether is not a decentralized crypto. It's a centralized stablecoin. Stablecoins carry huge counterparty risk. DYODD and caveat emptor.
 
From Dec 8, 2023. Not posting as news. I like stories about thieves & con artists.

Ontario’s ‘Crypto King’ owes investors millions. How is he still living large? | About That​

Despite being forced into bankruptcy, Ontario's self-proclaimed 'Crypto King' Aiden Pleterski has been taking vacations in the U.K. and Miami and posting about it on social media. Andrew Chang explains how someone who owes investors millions can continue living a seemingly lavish lifestyle.

12:02
 

Fraud cost $500B, illicit money topped $3T in 2023: Report

Payments fraud is the most expensive kind, at $450B; anti-financial-crime execs are the most worried about real-time payments, a survey from Nasdaq and Oliver Wyman found.
www.americanbanker.com

Yeah, and it's crypto that is a problem.
 
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UPDATE 1-Tougher EU money laundering rules target crypto and oligarchs''favourite toys'​

LONDON, Jan 18 (Reuters) - The European Union on Thursday agreed tougher anti-money laundering rules for cryptoassets and dealers in luxury cars and yachts, warning that oligarchs and criminals could no longer hide in the 27-country bloc.

Representatives of EU states and the European Parliament reached a deal on the new framework in negotiations that concluded in the early hours.

"It is a good day for EU citizens and businesses, but bad day for oligarchs and terrorists," said Eero Heinaluoma, one of lawmakers who took part.

The EU has long had anti-money laundering rules, but they were applied differently in each member state, making it easier for cross-border crime to flourish.

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Terraform Labs files for bankruptcy protection in US​

https://www.msn.com/en-us/money/com...rotection-in-us/ar-BB1h3bJ4?OCID=ansmsnnews11

Terraform Labs (TFL), the company behind the stablecoin TerraUSD, which collapsed and roiled cryptocurrency markets in 2022, filed for Chapter 11 bankruptcy in the United States, according to court papers filed on Sunday.

Singapore-based Terraform Labs, in a filing with the bankruptcy court in Delaware, listed assets and liabilities in the range of $100-$500 million.
 

FEDERAL JUDGE SENTENCES LAWYER TO 10 YEARS IN ONECOIN MONEY LAUNDERING CASE​

In a significant legal development, Mark Scott, a lawyer implicated in money laundering through the infamous OneCoin cryptocurrency scheme, has been sentenced to 10 years in federal prison. The decision was handed down by Judge Edgardo Ramos of the U.S. District Court for the Southern District of New York on January 25.

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2024 Crypto Crime Trends: Illicit Activity Down as Scamming and Stolen Funds Fall, But Ransomware and Darknet Markets See Growth​

2023 was a year of recovery for cryptocurrency, as the industry rebounded from the scandals, blowups, and price declines of 2022. With crypto assets rebounding and market activity growing over the course of 2023, many believe that crypto winter is ending, and a new growth phase may soon be upon us.

But what did all of that mean for crypto crime? Let’s look at the high-level trends.

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2024 Crypto Crime Trends from Chainalysis

Get the latest on key 2024 trends in cryptocurrency-based crime, including ransomware, crypto scamming, sanctions, and more.
www.chainalysis.com
 


I'm really curious what exactly "commercial exploitation of copyrighted works" means. What did they do to justify the FBI, BKA et al to pursue them for over a decade after they stopped whatever they were doing? Some sort of dark web Napster file sharing type thing?
 

Dark web drug kingpin surrenders $150m in crypto​

Unraveling a dark web drug network that spanned continents and sent shockwaves through the cybercrime world, Banmeet Singh, a 40-year-old Indian national, has dramatically confessed to operating a massive narcotics enterprise. His admission comes in the wake of the largest cryptocurrency and cash seizure in the history of the U.S. Drug Enforcement Administration (DEA), amounting to a staggering $150 million in forfeited crypto assets.

Singh’s criminal saga, characterized by the sophisticated use of the dark web and cryptocurrency, marks a significant chapter in the ongoing battle against digital-age drug trafficking. This case isn’t just about numbers; it’s a stark reminder of the evolving landscape of criminal networks and their adaptation to the digital era.

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RE: post 17 (no exact explanation about the copy right violations)

Germany Seizes Over $2 Billion In Bitcoin From Piracy Proceeds​

An investigation into copyright violations by the German state of Saxony led to the uncovering of 50,000 Bitcoin
https://www.benzinga.com/quote/btc-usd

What Happened: German authorities announced the seizure of almost 50,000 Bitcoins equivalent to around $2.1 billion after an investigation by Saxony prosecutors, Germany’s Federal Criminal Police Office and the U.S. Federal Bureau of Investigation. It is termed as the most extensive seizure of Bitcoins by law enforcement in the Federal Republic of Germany.

Bitcoin was acquired by two German and Polish national suspects in mid-January 2024. The profits of a German file-sharing portal with operations until 2013 were used for the purchase. One suspect voluntarily transferred the token to the German federal police wallet.

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Germany Seizes Over $2 Billion In Bitcoin From Piracy Proceeds

An investigation into copyright violations by the German state of Saxony led to the uncovering of 50,000 Bitcoin (CRYPTO: BTC) acquired usi
www.benzinga.com
 
So it was a file sharing portal as speculated.
 

School officials busted for hidden crypto mining operation​

The United States Department of Justice (DoJ) has filed charges against two senior staff members of the Patterson Joint Unified School District, accusing them of operating a cryptocurrency mining operation within the premises of the district’s ten schools.

Jeffrey Menge, the assistant superintendent and chief business officer, and Eric Drabert, the IT director, allegedly utilized school resources and increased electricity costs to mine cryptocurrency and transferred the proceeds to their crypto wallets.

The DoJ alleges that Menge and Drabert purchased high-end graphics cards and employed them and other school district property and electricity to establish and maintain a cryptocurrency mining farm on school grounds. The specific number of schools involved in this operation has not been disclosed, though the district serves approximately 6,200 students across its ten schools.

The nature of the cryptocurrency mined in this operation remains undisclosed. However, some of the commonly mined cryptocurrencies include Bitcoin (BTC), Monero (XMR), Ravencoin (RVN), and Dogecoin (DOGE).

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I'm surprised we don't hear of more stories in this fashion. Doesn't matter what business (doesn't have to be a public school) - it's fairly easy for someone with access to set up a computer to mine crypto using the company's electricity.
 
Craig Wright Denies Forging Evidence He’s Satoshi on Day 2 of COPA Trial

From self-plagiarism to poor multitasking, the self-proclaimed Bitcoin inventor offered an explanation for every inconsistency pointed out by opposing counsel during his first cross-examination in the London court case.

“If I had forged that document, then it would be perfect.”

So spoke Australian computer scientist Craig Wright Tuesday, minutes into his first day of cross-examination in a U.K. trial that could lay waste to his controversial claim that he is the father of cryptocurrency.

Denying an accusation from opposing counsel, Wright claimed that inconsistencies in a pdf showed not that it had been doctored but the opposite. Turning to presiding Judge James Mellor, the defendant said, "If you go into Adobe, My Lord, and I change everything, there's not going to be a font error."

An alliance of crypto advocates and developers have sued Wright, accusing him of committing forgeries on an “industrial scale” to prove he is Satoshi Nakamoto, the pseudonymous inventor of the oldest and most popular cryptocurrency, bitcoin.

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Slightly under $4B? Not too bad considering that Americans lost $10B to (dollar based) investment scams last year:

Think you know what the top scam of 2023 was? Take a guess

Every day people report to the FTC the scams they spot. Every year, the FTC shares the information we collect in a data book which tells a story about the top scams people tell us about – so we can all spot and avoid them.
consumer.ftc.gov

 
2 weeks ago:

Today:

Crypto ‘Mixer’ Convicted of Money Laundering on Bitcoin Fog

The founder of a cryptocurrency mixing service known as Bitcoin Fog was convicted in Washington federal court of helping to launder tens of millions of dollars from darknet markets known for selling illegal drugs.
www.bloomberg.com
 

Update:

Craig Wright ‘Committed Perjury’ in U.K. Trial Over Satoshi Claims, COPA Says

  • Closing statements in the U.K. trial probing Craig Wright’s claims of having invented Bitcoin kicked off Tuesday.
  • In its closing arguments, the Crypto Open Patent Alliance (COPA) accused Wright of committing perjury in addition to committing forgeries.

A crypto alliance accusing Craig Wright of committing forgeries in attempting to prove he’d invented Bitcoin plans to ask U.K. prosecutors to consider if the computer scientist perjured himself during an ongoing trial.

The weeks-long trial is nearing the end, and the outcome – to determine whether Wright is pseudonymous Bitcoin inventor Satoshi Nakamoto – could influence several other cases by Wright against members of the crypto community.

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Cyber Heist of Over $145 Million in Ether Laundered Following Heco Bridge Exploit​

In a dramatic unfolding of events that underscores the persistent vulnerabilities within the cryptocurrency sector, hackers behind the 2023 Heco Bridge exploit have successfully laundered an astonishing $145.7 million in ether.

The operation, conducted over a mere eight-day period through the cryptocurrency mixer Tornado Cash, highlights the sophisticated strategies employed by cybercriminals to evade detection and the ongoing battle against illicit financial flows in the digital asset space.

The saga began with a significant security breach of the Heco Bridge, a crucial conduit for transferring funds between the Ethereum blockchain and the Heco Chain, managed by the HTX Exchange (formerly known as Huobi). In November 2023, attackers orchestrated a heist that siphoned off approximately $111 million in various cryptocurrencies, including ether, USDT, USDC, and HBTC. The swift movement of these stolen assets across decentralized exchanges for conversion into other cryptocurrencies was a calculated attempt to muddy the waters and obscure the origins of the illicit funds.

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Detained Binance Executive Escapes Custody in Nigeria, Government to Request Interpol Assistance​

Nadeem Anjarwalla, one of the Binance executives detained by the Nigerian government in late February, has reportedly escaped from custody. Anjarwalla, a British and Kenyan citizen, is suspected of using his Kenyan passport to leave Nigeria on an unidentified Middle East airliner.

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Detained Binance Executive Escapes Custody in Nigeria, Government to Request Interpol Assistance – Bitcoin News

The Nigerian government confirmed Anjarwalla’s escape and said it planned to ask Interpol to issue an international arrest warrant.
news.bitcoin.com
 

Crypto Exchange Kucoin and Founders Charged With Bank Secrecy Act and Money Laundering Violations – Bitcoin News

New York has announced charges against the crypto exchange Kucoin and its founders for major violations of U.S. anti-money laundering laws.
news.bitcoin.com
 
Where, oh where to post this?????????? Since polluting is a crime, this looks like the place.

Crypto miner, Pennsylvania hit with lawsuit over pollution from bitcoin mine​

  • Lawsuit claims coal waste, old tires are burned to run mine
  • Community group is seeking damages, and injunctive relief
March 26 (Reuters) - An environmental community group on Tuesday sued Stronghold Digital Mining Inc (SDIG.O), opens new tab, claiming the company's bitcoin mine in northeastern Pennsylvania that burns waste coal and old tires for energy is polluting nearby communities with dangerous chemicals.

The lawsuit by Save Carbon County filed in state court in Philadelphia, also names Pennsylvania as a defendant. The group, a nonprofit whose members live near the bitcoin mine, is seeking compensatory and punitive damages from the company, and an order directing the state to stop allowing the pollution to continue.

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Munchables Exploited for $62M, North Korea-Linked Exploiter Returns Private Keys to Web 3 Firm

  • Munchables, a Web3 project on the Blast blockchain, suffered a hack that resulted in a loss of $62.5 million worth of ether (ETH).
  • The attacker manipulated a contract and transferred stored user funds before upgrading the platform’s smart contracts.
  • Blockchain sleuth ZachXBT linked the attacker to North Korea, with the hacking group allegedly stealing $3 billion worth of tokens since 2017.
Web3 project Munchables was drained of an estimated $62.5 million worth of ether (ETH) early Wednesday after a contract was maliciously manipulated, blockchain data shows.

Munchables said on X that the developer had shared all private keys to recover the funds.

The attacker apparently transferred the stored users’ funds to themselves before upgrading the platform’s smart contracts. Blockchain sleuth ZachXBT said the attacker was likely North Korean, based on their GitHub commit activity. They are listed on GitHub as “Werewolves0493” and allegedly worked for the Munchables team.

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Update:

KuCoin Withdrawals Spike to $1B in Crypto Amid U.S. Regulatory Clampdown

  • KuCoin saw over $1 billion in withdrawals over the past 24 hours, Nansen data shows.
  • Assets held by the exchange dropped to $4.8 billion from $6 billion, according to Arkham blockchain data.
  • The exchange "is operating well, and the assets of our users are absolutely safe," KuCoin said.

Crypto exchange KuCoin saw about $1 billion in crypto withdrawals over the past 24 hours and assets under management (AUM) slumped 20% as the trading platform faced charges from U.S. authorities, data from Nansen and Arkham Intelligence shows.

The exchange experienced $1.083 billion in outflows via Ethereum Virtual Machine-compatible (EVM) chains during the period, and only $144 million of inflows. Nansen data did not include bitcoin (BTC) withdrawals. Net outflows on the Ethereum network reached $840 million, according to Nansen.

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KuCoin is imploding as it is very likely to lose it's court cases in the USA and eventually get cut off from servicing American customers. I tried many years ago to open an account with them (this was before Coinbase existed). I was not successful in doing so. The process was too difficult.
 

The US and the UK are reportedly looking into $20 billion of crypto payments that may have helped Moscow evade sanctions​

  • The US and UK are probing over $20 billion of crypto transactions via a Russia-based exchange, according to Bloomberg.
  • That amount would mark the most significant violation of sanctions since the war began, the report said.
  • The US hit the Moscow-based Garantex crypto exchange with sanctions in 2022.
Bloomberg reported on Thursday that the US and UK are probing $20 billion in cryptocurrency transactions that passed through a Russia-based exchange, as the West seeks to tighten the screws on methods Moscow could be using to evade sanctions over its war against Ukraine.

Sources told Bloomberg that the payments under scrutiny flowed through the Moscow-based Garantex crypto exchange, utilizing the dollar-pegged stablecoin Tether.

The $20 billion of transactions would mark one of the most significant violations of sanctions against Russia since the Biden administration's crackdown on Kremlin-linked crypto exchanges at the start of the war in February 2022, the sources told Bloomberg. However, they noted that due to the complexity of cryptocurrency transactions, it's too early to draw conclusions.

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Another crypto Icarus like SBF. He tried flying too close to the sun.
 
Opinion piece.

Crypto Does Not Have an Illicit Finance Problem, Bad Actors Do

Deputy Treasury Secretary Wally Adeyemo’s April 9 testimony before the U.S. Senate Banking Committee is set to provide a veritable state of the union address on illicit finance, and crypto will undoubtedly feature prominently at the hearing. This is especially true, as headlines of Russia’s use of “crypto” to evade sanctions or traffic arms are making the rounds.

Notwithstanding crypto’s checkered scorecard over the last few years, which saw record losses, market manipulation, fraud and clear examples of highly traceable illicit finance (albeit comparatively small), the media’s use of the word “crypto” as a catchall is disingenuous. Most often, it is named single products, blockchains and platforms such as Tornado Cash or Terra-Luna that create a nexus of bad activity. The digital assets industry, like banking, is not monolithic.

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