In the United State’s capital this week there has been a heavy crackdown on illicit digital currency transactions with the State’s Security service seizing an estimated value of $102 million worth of crypto assets from criminals with ties to fraud related investigations.
The assistant director of State Security investigations, David Smith, in an interview on Wednesday 20th April 2022, said that the team’s agents and analysts actively tracked the flow of many cryptocurrencies including Bitcoin on the blockchain, with a method that is similar to an old-fashioned surveillance.
Best known for keeping presidents safe, the State Security Service also conducts financial and cybercrime investigations.
In an interview at the Security Service headquarters, Smith mentioned that following a digital wallet is not very different from following a regular e-mail address, both have some correlating identifiers. In his words: “once a person and another person make a transaction, and that gets into the blockchain, we have the ability to follow that email address or wallet address, and trace it through the blockchain.”
Investigations Surrounding The Seizure
The seizure of about $102 million worth of crypto is a compilation of 254 cases that occurred from the periods of 2015 till 2022. According to the agency’s statistics.
Amongst these cases is the investigation with the Romanian police where about 900 victims across the United States were targeted and defrauded. The scheme involved posting false adverts on popular online auctions and sales websites for luxury items that were nonexistent.
They were also delivering invoices supposedly from reputable companies, to give their victims the impression that the transactions were all real.
The perpetrators then engaged in a money-laundering scheme in which victims’ funds were converted into digital assets, according to the State’s Security Service.
Furthermore, there were also very notable cases involved in the entire mix. Some of these other cases targeted a Russian cybercrime syndicate that employed a crypto exchange in laundering funds as well as ransomware operation tied to Russian and North Korean criminals in which bitcoin payments by United State’s companies to stop the attacks were sent to the crypto wallet of the suspect.
Smith added that one of the unique things about cryptocurrency is that it moves very fast. Faster than the traditional format and this quick format makes it more attractive to not just American customers but to criminals as well.
In his exact words: “What criminals want to do is sort of muddy the waters and make efforts to obfuscate their activities. What we want to do is to track that as quickly as we can, aggressively as we can, in a linear fashion.”
How The Security Service Manages To Pin These Fraudulent Activities
In an interview conducted in the Agency’s Global Investigative Operations Center known as GIOC – in which agents and crypto analysts track cryptocurrency transactions worldwide in a secure room at their headquarters – Smith disclosed that Once the Secret Service pins down the illegal activity, it works to dig a little deeper into those transactions and deconstruct them
Smith said. “You send me something bad on an email, I know there’s some criminal activity associated with that email address. I can deconstruct, find whatever tidbits of information that you used when you initially logged in or signed up for that email address.”
Investigators are now finding out that these criminals will often transfer stolen Bitcoin and other digital currencies into stable coins.
Therefore, in order to track that kind of activity, the cryptocurrency market must be closely studied, after all, the criminals are humans too.