|Oct 04, 2018 04:00 PM||By: Art Vasquez | 2364 Views|
A "vulnerability" is produced every time criminals turn from cryptocurrency to government-issued ones, an administrator with U.S. Immigration and Customs Enforcement stated Tuesday.
Matthew Allen, an assistant director of essential services with the Homeland Security Investigations (HSI) division of ICE, discussed the role of cryptocurrencies in drug trafficking through an October 3 performance before the U.S. Senate Caucus on International Narcotics Control.
"On darknet marketplaces and other 'unindexed' websites, purchases are often paid for with cryptocurrencies such as bitcoin and monero, among many others," he stated in an adjusted statement.
Maybe most notably, he noted that HSI is producing some level of success in tracking criminals who use cryptocurrencies to launder returns from drug sales.
While cryptocurrencies make shifting value relatively easy, he contended, offenders still need to convert cryptocurrencies into fiat – and vice versa – during the process. "Whenever monetary exchanges are made, a vulnerability is created," he maintained on to say.
"This is the time when criminals are most susceptible to identification by law enforcement means and methods," Allen stated, revealing:
"Utilizing traditional investigative methods such as surveillance, undercover operations, and confidential informants, coupled with financial and block-chain analysis, ICE-HSI can disrupt the criminals and dismantle the [transnational criminal organizations], as well as the cryptocurrency exchangers who typically launder proceeds for criminal networks engaged in or supporting darknet marketplaces."
Allen went on to handle various types of cryptocurrency exchanges and how they may be used to promote money laundering. Peer-to-peer, in a singular, leading to startups which refuse to register as a money services business and do not follow agreement laws, are often used to secure users continue anonymous.
Notwithstanding that, however, national and international agencies are training researchers in how to best track cryptocurrencies, he stated.
"We train investigators ... to deter organizations from laundering proceeds or using cryptocurrencies to fund the purchase of fentanyl/opioids or other narcotics," he stated.