Cyber Crime
Cartels are using crypto more frequently than ever before, and the federal authorities entrusted with apprehending them are also becoming more aware of this.
The IRS Cyber and Forensics Services chief Jarod Koopman points out that while cash is still the preferred currency of traffickers, officials who track cartels revealed in interviews that cryptocurrency has gained popularity since it reduces the possibility of hand-to-hand transactions.
A senior Drug Enforcement Administration officer told that this new, tech-savvy generation of traffickers goes above and beyond to hire crypto specialists in an effort to better hide their footprints than the previous generation. The Sinaloa Cartel, which is currently managed by the sons of drug lord Joaquin “El Chapo” Guzmán, is one of the greatest advocates of the use of cryptocurrencies.
Homeland Security special agent Scott Brown said that since the cartels are so eager to invest in technology, the government ought to do the same.
The agent in head of the HomeSec investigations team in Arizona said it was one of the things we needed to be equally willing to do.
Launderette
Cryptocurrencies are a terrific tool for criminals to launder money all across the world, and it appears that cartels are no exception.
In one recent instance that the Justice Department unveiled earlier this year, the Sinaloas were accused of using cryptocurrency to launder over $869,000 between August 2018 and February 2023. According to the authorities, even that enormous sum is probably just a small portion of the money that was laundered because the syndicate made profit margins in the hundreds of millions of dollars.
According to that indictment, the cartel’s senior money launderers used mules to collect cash from their fentanyl suppliers and transfer it into the group’s cryptocurrency accounts.
The research points out that the borderless character of crypto also meshes well with the transnational movements of drug cartels. For instance, fentanyl is typically produced in China before being packaged into pills or powders and delivered to the US. Numerous phases along the road involve crypto payments, much like with conventional human trafficking transactions. The government withheld its exact methods, but a knowledge of blockchain analysis could help in spotting these multi-agency moves.
While the majority of crypto seizures won’t lead to the capture of Chapo Guzman, each piece of the puzzle counts, according to Brown. As with traditional criminal enterprises and the investigations into them, focusing on the producers and middlemen can lead to the collapse of the entire operation.
