Crypto ‘Crime-as-a-Service’ shut down in Spain for money laundering


Crypto ‘Crime-as-a-Service’ shut down in Spain for money laundering

It should come as no surprise that crooks also know the benefits of outsourcing, especially when it comes to money laundering. To perform the entire operation on your own would require a multitude of phony companies, bank accounts, and the ability to transfer and deposit at will, not exactly what a common thief could build for himself in his spare time. Criminal outsourcing, however, recently hit a wall, as one such crypto “Crime-as-a-Service” (“CAS”) enterprise was just shut down by police in Spain.

According to reports: “Guardia Civil (Spanish Civil Guard) arrested eight people in connection with the crime while charging eight more for involvement. Wallets containing 9 million euros were also frozen. Besides the bitcoin wallets, which were frozen, two bitcoin ATMs and cash totaling nearly 17,000 euros were seized in addition to 11 cars, computers, devices, and other properties.” Europol also provided these further details:

Spanish authorities froze four ‘cold wallets’ and 20 ‘hot wallets’, to which €9 million was transferred, as well as several bank accounts.

While “Software-as-a-Service” (“SAS”) entities have become common and the rage in the commercial world as a way to leverage cloud computing to reduce costs and gain efficiencies, it seems that the criminal element of our society has also followed this same business model to further their illicit activities. Unless you are not a major crime gang that is supported by a government state, the latest avenue for cyber-crime mischief, you do not have the capital to fund an elaborate scheme for hiding your tracks. Outsourcing suddenly becomes an economical way of doing business.

How did the CAS operate? Here are a few details:

The crypto money-laundering ring also employed smurfing and layering techniques common in money laundering activities. The smurfing involved splitting the dirty money into tranches. They would then deposit the portions in different bank accounts owned by the gang. On the other hand, layering involved moving the funds via several accounts prior to exchanging it for bitcoin. The gang also had various corporate entities which were used to make large deposits to bank accounts. From these accounts, funds would then be wired to cryptocurrency exchanges based abroad.

Law enforcement authorities state that these types of money laundering enterprises are rampant and can be found directly by referrals via the “Deep Dot Web”, a website for facilitating access to dark web sites and marketplaces. In one case, the FBI recently had two Israeli suspects arrested, one in Tel Aviv, while the other was taken in Paris.

Europol, the Brazilian Federal Police, the Dutch National Police, and the Israeli National Police assisted in this operation, which was also supported by the Joint Criminal Opioid and Darknet Enforcement, the U.S. Postal Inspection Service, and the IRS’ Cyber Crimes Unit. This type of international crime requires quite a bit of global coordination and cooperation in order to nab well-funded crooks on the run.

In a second case in the U.S., “Three men were indicted by the Manhattan District Attorney’s Office for a crypto money laundering operation. In this case, they were indicted for laundering approximately $2.3 million. The three apparently used debit cards, which were pre-loaded with crypto. They would then withdraw cash amounts from ATMs located in New York and New Jersey.”

Whether the money laundering schemes uncovered in these thee instances were high-tech or low-tech, the approach was the same. Smurf and layer the funds via mediums that offer an easy way to disguise ownership and then convert the funds through legitimate channels into the desired fiat currency. Law enforcement authorities in these three cases were wise to these details and were able to catch the crooks and seize stolen property before a clean getaway, a rare positive step for the “Good Guys”.

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Crypto ‘Crime-as-a-Service’ shut down in Spain for money laundering

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