Mexican authorities have reported an increase in the use of cryptocurrencies for money laundering by criminal gangs in Latin America.

In a report released by Reuters on December 8, Santiago Nieto, head of financial intelligence at the Mexican Ministry of Finance, described how cartels use cryptocurrencies to launder illegal money.

Neto claims that Latin cartels usually deposit their illegal income in various bank accounts for less than $ 7,500 – the least that will require banks to specify the transaction. The money is then used to create countless small amounts of Bitcoin (BTC), which can then be moved across borders without any problems.

A 2018 law required registered cryptocurrency trading platforms to report transfers in excess of MXN 56,000 (approximately $ 2,800). Local authorities hope this will help them respond to the use of digital assets of organized crime.

The arrest of human trafficker Ignacio Santoyo in April 2019 is linked to the law when the authorities decided that Santoyo and his sister received more than $ 22,000 in bitcoins on the local Bitso exchange.

Hector Ortiz, the accused leader of the Mexican hacking band Bandidos Revolution Team, was also arrested after police revealed he had spent “tens of thousands of dollars” from BTC, giving investigators a reason to track his location using cellphone data.

However, Rolando Rosas, head of electronic investigations at the Mexican Attorney General’s office, told Reuters that police authorities lack the resources to deal with money laundering. He said the division has 120 employees – about a quarter of what is needed – and is struggling to keep up with a minimum of 1,033 bitcoin alerts triggered on registered trading platforms this year.

Almost 98% of the transactions were registered by Volabit, the stock exchange that operates in the state of Jalisco for the next generation Jalisco home cartel. Tomas Alvarez, CEO of Volabt, told Reuters:

“It is a mistake […] to assume that since alerts are generated by a company based in Jalisco, they must match the residents of Jalisco […] We have users from all over the country. In fact, most reports are not from users living in Jalisco. “.
In January, a report from the US Drug Enforcement Administration indicated that hard currency seizures fell from $ 741 million in 2011 to $ 234 million in 2019, indicating that organized crime groups are now using cryptocurrencies for much more. operations. From money laundering activities.

Source: CoinTelegraph

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