Crypto Crimes: ICO Scams, Robbery, and Money Laundering

The rising recognition of cryptocurrency and blockchain record has brought many advantages to the world; however, this hasn’t come but a few down sides. Along the way, we have also seen a arise in the number of cryptocurrency crimes. From kidnappings to income laundering and many more forms of crime, military and governments around the creation are looking to coordinate efforts in sequence to stop crypto criminals. In this article, we’ll take a look at some example cases and how law coercion is doing them.

ICO Scams

ICO scams are one of the most common forms of cryptocurrency crimes. Oftentimes, plan teams are totally fictitious. As during any ICO, investors send ETH, BTC, USD, and/or other currencies to the wallets of the project. The only disproportion is that feign projects keep the supports and give no tokens whatsoever in return. Most often, these scams engage feign plan organisation profiles, which infrequently even embody big-name entrepreneurs like Richard Branson.

Kevin BalengerOne ICO for a plan called Miroskii used a print of actor Ryan Gosling for a form of a feign striking engineer named “Kevin Belanger”. While it might seem transparent to some or even most people that this was a feign profile, this fake ICO indeed claimed to have lifted $830,000. Little is famous about the consequences of such a fraud since there is now no info online about any charges opposite the project. Even the plan website is still running; however, you won’t find the form for “Kevin Belanger” or anyone else on the organisation any more.

The ICO fraud emanate is so bad that the United States Federal Trade Commission (FTC) will be deliberating this as part of its seminar in Chicago on Jun 25, 2018 at DePaul University. One of the biggest problems with ICO scams is the altogether miss of regulatory horizon in place for open fundraising at a inhabitant level. In the US, for instance, states like Texas have been the most active in banning certain cryptocurrency projects and ICOs that are deemed to be fraudulent.


It’s bad enough when someone loses income due to a cryptocurrency sell penetrate or an ICO fraud but there are even worse ways to get supports stolen. There have been quite a few incidents of spoliation and kidnappings involving cryptocurrency. During one such occurrence in Dubai, a squad of 10 people simulated to be in assign of arising mandated trade licenses for cryptocurrency. Two brothers who were looking to squeeze trade licenses were carrying around $1.9 million in cash. The squad impersonating the trade permit issuers stole the income from the two brothers and also assaulted them. Since that time, the 10 suspects have been apprehended and referred to open prosecutors.

Louis Meza

In another incident, Louis Meza, a male from New Jersey, even kidnapped his crony and stole $1.8 million in cryptocurrency. Meza lured his crony into a minivan and a gunman forked a pistol at the friend, perfectionist his 24-word passphrase to entrance the victim’s Ledger Nano S wallet. Meza also looted the victim’s apartment, hidden a bill and other information. While a lot of cryptocurrencies are designed to make the send supports untraceable or at slightest rather formidable to track, Meza made two pivotal mistakes.

First, there was notice video display him enter the victim’s apartment. Second, he used a renouned cryptocurrency sell to send stolen supports from ETH to BTC. The account’s open residence enclosed his possess name, which gave a lot of justification joining Meza to the crime. Meza pleaded not guilty to grand larceny, kidnapping, spoliation and associated depends at his prosecution in the Manhattan Supreme Court in Dec 2017. The decider systematic $1 million bond or $500,000 income bail. 

Money Laundering

There have already been a few large-scale cases for income laundering around cryptocurrency. Thomas Mario Costanzo allegedly used cryptocurrencies to launder deduction for drug dealers. Costanzo was arrested during a USDHS-coordinated raid in Apr 2017. Evidence also shows that Costanzo used crypto to buy drugs and offering an online cryptocurrency sell use for other people to squeeze drugs but adding the compulsory KYC authentication process.

The probable judgment for such crimes is rather hefty. The 5 charges placed on Costanzo can move a limit judgment of 20 years in prison, a $250,000 fine, or a multiple of the two. In addition, any cryptocurrencies used in these crimes could be taken divided by the U.S. Justice Department. The sentencing will take place on Jun 11, 2018.

There have even been some cases requiring ubiquitous law coercion cooperation. One new example concerned authorities from Finland, Spain, the United States, and Europol. In this case, 137 people were investigated and 11 were eventually arrested in Apr 2018. Originally, criminals laundered drug income from Spain to Colombia using credit cards.

The organisation satisfied fast switched to cryptocurrencies after realizing the easy traceability of normal bank accounts. Nonetheless, law coercion officials from Europol were means to lane down criminals by monitoring crypto-to-fiat sell exchange (Colombian pesos). Europol has settled that it is committed to giving additional cryptocurrency crime showing training to the officers. It will also continue to coordinate to stop such crimes both within the EU and beyond.


The Future of Crypto Crimes

Undoubtedly, crimes associated to cryptocurrency will continue to arise as the recognition of cryptocurrency in ubiquitous rises. Even though there are many good aspects of a crypto-based economy (i.e. larger transaction privacy, users control over funds, and leisure of collateral flow), these same advantages do move new intensity hurdles to interlude crimes of the benefaction and future. In some instances, criminals might still leave behind justification that can be tracked.

However, it is also expected that cryptocurrency crimes will turn more perplexing and potentially even more formidable to stop than normal crimes trustworthy to fiat currency. As criminals turn smarter, it is transparent that law coercion agencies will have to sojourn on tip of changes in rising technologies as they describe to rapist activity.

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