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SWIFT Says Money Launderers Not Using Crypto as Much as Media Paints it

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) has debunked the widespread notion that criminals majorly use cryptocurrencies to launder ill-gotten funds. 

In its recent report titled ”Follow the Money,” the SWIFT interbank messaging system sheds light on how hackers siphon funds from financial systems mostly after a massive cyberattack to avoid being traced.  

Brett Lancaster, Head of the Customer Security Programme at SWIFT, said that as money laundering cases keep increasing, financial regulators need to develop effective policies to mitigate the practice. 

Lancaster added that cybercriminals have evolved over the years and have adopted untraceable money laundering techniques to effectively move stolen funds without being caught.

Fiat cases outweigh crypto’s

According to SWIFT, contrary to the widespread belief that criminals usually launder stolen funds through cryptocurrencies, the use of digital currencies in money laundering is “relatively lower” than other traditional techniques. 

Even though cryptocurrency’s use in money laundry has a significantly lower amount than traditional methods, SWIFT highlighted a major case where a cybercrime group had leveraged digital currencies in converting stolen funds obtained from ATM cashouts.  

On the other hand, the traditional techniques used in laundering stolen funds include front companies, cash businesses, money mules, and financial representatives.  

Of all the traditional methods deployed, money mules seem to be the best tactic adopted by the criminals. 

The report stated that cybercriminals usually recruit unsuspecting job seekers to act as money mules of the gang. They act as intermediaries between the criminal organization and their benefactors. 

However, despite being lucrative and faster for participants, money mulling poses a significant risk, as these actors are mostly at the front line of the heist during an investigation.   

Despite recording lower use cases in money laundering, SWIFT noted that the adoption of cryptocurrencies for such purposes could spike in the future because of its anonymity feature. 

The crypto space frowns at money laundry

SWIFT’s prediction may not come to light as the crypto industry is doing everything to keep money laundry practices out of the industry.  

Last year, Coinfomania reported that South Korean top crypto exchanges, including Bithumb, Upbit, Corbit, and Coinone, launched a hotline to enable the firms to share information of any suspicious transactions.

See Also: Hypocrites? Deutsche Bank Not Bitcoin Pays €15M for Money Laundering

 

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