The U.S. Drug Enforcement Department (DEA) have raised their concerns about international narco cartels using Asian crypto channels to conduct money laundering operations, Asia Times reports today.
The special focus has been placed on the Mexico-based criminal organizations.
“The participation of Asian money launderers has become more prominent in some areas. The shift toward Chinese and Asian money launderers is believed to be, in part, due to the natural relationship created by the large volume of both licit and illicit trade goods and chemicals imported from China. The use of an Asian money broker simplifies the money laundering process and streamlines the purchase of precursor chemicals and paraphernalia utilized in manufacturing drugs for street sales”, said Paul Knierim, deputy chief of operations in the Office of Global Enforcement at the DEA.
Around $60 billion of drug sales are made in the US alone. Recently, the increase in the crypto-based transactions has been recorded as it offers more anonymity compared to conventional channels.
This issue was a hot topic during a hearing into Mexican drug cartels and border security before the U.S. Congress.
The most recent DEA National Drug Threat Assessment report notes that Bitcoin and other digital currencies are creating difficult circumstances for authorities to track illegal money.
“Bitcoin is the most common form of payment for drug sales on darknet marketplaces and is emerging as a desirable method to transfer illicit drug proceeds internationally. Bitcoin is the most widely used virtual currency due to its longevity and growing acceptance at legitimate businesses and institutions worldwide”, it is said in the report.
As Chinese laws allow up to $50,000 to be transferred outside of their borders annually, illegal channels have been built to accommodate bigger amounts. The DEA singles out the Chinese Underground Banking Systems (CUBS) as one of the popular modalities used by cartels.
This is not the first time that regulatory authorities have raised their concerns over digital cash being used by the international criminal organization to conduct money laundering operations. Given the anonymity and privacy that certain token offer, it is difficult to expect that this trend of complaining from the authorities is going to stop.Leave a comment