Tumblers were being used to launder one cryptocurrency for other
DoJ to continue to trace crypto criminals in US
Crypto sector in US remains unregulated
Fiat currencies are still chosen more over crypto assets by criminals to launder funds
Photo Credit: Facebook/ Department of Justice
Police officials have confiscated crypto assets worth around $34 million (roughly Rs. 256 crore) from a dark Web seller in Florida. In an official statement, the US Department of Justice (DoJ) has called this “one of the largest cryptocurrency forfeiture actions ever filed”. Law enforcement authorities had identified that the Florida resident had been raking in millions by using an online alias to make over 100,000 sales of illicit items. Crypto assets were also being misused for laundering money by the dark web seller.
‘Tumblers' and illegal dark web money transmitter services were being used to launder one cryptocurrency for another — a technique called chain hopping. The activity violates federal money laundering statutes.
Tumblers pool together multiple cryptocurrency transactions and distributes the cryptocurrency to a designated wallet at random times and in random increments. The goal is to hide the original source of funds.
“This forfeiture action is the result of Operation TORnado, a joint investigation that stems from the ongoing efforts by OCDETF, a partnership between federal, state and local law enforcement agencies,” the DoJ said. The OCDETF, or the Organised Crime Drug Enforcement Task Force, that tackle transnational criminal organisations.
Details about the identity and arrest of the dark Web seller remain unclear. The DoJ has revealed that the person in question was selling stolen details of HBO, Netflix, and Uber accounts.
Despite rising concerns about cryptocurrencies being rampantly used by criminal activities such as money laundering, fiat is still way ahead in terms of being the preferred choice for illegal activities, as per the US Treasury.
The use of crypto assets for money laundering continues to be significantly less prevalent than the use of fiat cash and other traditional means, a recently released reports from the US government said.
The US authorities have meanwhile been keeping an eye on crypto movements as the sector remains largely unregulated for now. Just last month, US prosecutors charged two men from Los Angeles with money laundering and fraud with an NFT series called ‘Frosties'. Ethan Nguyen and Andre Llacuna pocketed $1.1 million (roughly Rs. 8 crore) before abandoning their NFT project and leaving buyers high and dry in terms of promised benefits.
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