Law enforcement Oct 30, 2020

$29 Million in Bitcoin Seized From Dutch Dark Web Money Launderers

A Dutch court has confiscated $29 Million in Bitcoin from a couple on money…

The Netherland’s Rotterdam District Court has confiscated $29 million worth of Bitcoin from a Dutch couple that was accused of engaging in money laundering via the dark web.

Reportedly, according to official information provided by the Dutch court, the man and his spouse lived in the City of Hilversum in the country’s North, and had engaged in large scale crypto money laundering.

The court handed the pair a 2-year and 2.5-year prison sentence for their role in laundering more than $18.9 million in cryptocurrency for about two and half years. The judgment was issued after investigators linked the crypto to dark web criminal activity.

The Case

A Dutch-language court document provided a glimpse into the law enforcement operation that led to the couple’s arrest. It turns out that two separate crypto sums of 1,488 Bitcoin and 1,044 Bitcoin were discovered and confiscated from the two convicts.

In addition, the police seized $295,256 in cash, which added facts to the case that saw the couple being served individual fines of $53,137 and forced to forfeit thousands of dollars for their illicit activity.

The Dutch court learnt that the couple’s money laundering scheme involved Bitcoin purchases that would be converted to large sums of the euro currency from private individuals and businesses.

Allegedly, the transactions involving huge sums of Bitcoin and fiat currency are reported to have place without the couple’s due diligence of notifying the relevant government agencies. The fact highlights their intention to keep transaction participants as anonymous as possible.

Further, the court found out that the couple exploited a city restaurant as grounds for the currency exchanges that did not adhere to the typical AML/KYC obligations.

Dark web criminals have been known to involve legitimate business in masking illicit crypto with legal transactions that avoid the normal checks and verifications that are needed when using fiat-crypto currency exchanges.

Dark Web Origins

The Rotterdam District Court ruled that the couple’s huge sum of cryptocurrency had links to illegal dark web spaces. The resolution follows common knowledge that Bitcoin and other cryptocurrencies continue to facilitate the exchange of goods and services, including child sex abuse materials, hitman services and stolen data.

The court asserted that the Hilversum traders did not care to request for identity papers from individuals that sold them their huge sum of Bitcoin. Instead, the couple accessed customers via promotional material found in underground platforms – with much of the Bitcoin being traced to the darknet.


How Criminals Launder Money Using Legitimate Business

A report by CipherTrace, a blockchain threat intelligence and anti-money laundering forensics firm, exposed the dark web criminal trends of exploiting crypto exchanges that exist in jurisdictions known to have weak anti-money laundering laws.

Estimates show that more than $2.5 billion worth of illicit Bitcoin has been cleaned via a hyper-connected system of crypto establishments across the world.

The use of legitimate businesses in laundering “dirty” crypto has become a common phenomenon as people look to avoid AML/KYC-compliant currency exchanges.

The way it works, a criminal enterprise moves to buy a legal and registered entity such as a restaurant that’s been in operation for a considerable amount of time.

The object of the game is to plug into an already-existing structure with employees and cash flows. A popular restaurant with lots of customers and transactions offers an ideal smokescreen for money laundering that would take place behind the scenes.

Criminals select a business where, if the authorities stop by, they would witness the constant flow of traffic.

Meanwhile, the restaurant’s bank account would be used to launder the dirty money, with the deposited money being used to trade in legitimate goods and real estate to generate legal profits.



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