Anti-Money Laundering (AML), Cryptocurrency Fraud, Cybercrime
Deputy AG appoints Eun Young Choi; In addition, the FBI forms a Virtual Asset Exploitation Unit
Devon Warren tiles (devawarren) •
February 18, 2022
The US Department of Justice this week appointed its first director of the National Cryptocurrency Enforcement Team and took further steps to strengthen investigative techniques in the fight against digital money laundering related to cybercrime.
See also: Live Discussion | Improve your data security to speed up ransomware recoveries
Eun Young Choi, who used to serve as the senior prosecutor on notable cases such as the hacking of JPMorgan Chase and Co. and the illegal operations of Coin.mx, will join the newly formed law enforcement division at its director.
Also, the FBI has formed a Virtual Asset Exploitation Unit, the DOJ says in a statement. The new entity will allocate its resources to training efforts and “innovative cryptocurrency tools” to help bring cybercriminals who use digital assets for illicit purposes to justice.
“The NCET will play a crucial role in ensuring that as technology surrounding digital assets grows and advances, the department accelerates and expands its efforts to combat its illegal misuse by criminals of all stripes,” said Choi.
Working in tandem with other criminal departments such as the Money Laundering and Asset Recovery Department and the Computer Crimes and Intellectual Property Department, the NCET will assist in the investigation of crypto-related crimes, including tracking and recovering digital assets related to fraud and extortion by ransomware threat actors.
Choi will report to CID Assistant Attorney General Kenneth A. Polite Jr. and lead attorney generals from jurisdictions across the country in prosecuting cases against crypto exchanges and other entities that facilitate crimes through digital assets.
The DOJ established the NCET in October, citing the rise of ransomware actors using cryptocurrency exchanges to launder money, as well as other cybercriminals on the dark web facilitating other criminal activities through cryptocurrency.
Speaking at the Munich Security Conference on Thursday, Deputy Attorney General Lisa Monaco said the NCET is currently pooling the efforts of a dozen prosecutors to investigate the case of allegedly conspiring couple Ilya “Dutch” Lichtenstein and Heather Morgan, aka “Razzlekhan.” to launder $4.5 billion stolen during the 2016 Bitfinex hack (see: Bust of a cryptocurrency pair shows money laundering risks).
Monaco discussed new initiatives to fight cybercrime at the conference.
Calling the new unit the “nerve center” of cryptocurrency experts, she said its agents would assist with blockchain analysis and digital asset seizures, as well as provide training and support to other FBI agents.
Monaco said that cooperation between international agencies and organizations will be an essential part of apprehending cybercriminals and that an international cyber liaison will work with cybercrime units at the DOJ and with international crime units like Europol to handle cross-border transactions, which often involve each other associated with ransomware ransom transactions.
Ari Redbord, an Information Security Media Group associate and head of legal and government affairs at TRM Labs, says the FBI has paved the way for fighting crimes that facilitate the illegal use of cryptocurrency, and the introduction of new squads is prolonging its Story of the “sequence”. the money.”
“Any agent in law enforcement will need the necessary tools and training to follow money on the blockchain,” he says.
Bloomberg News reports today that President Joe Biden is expected to announce an executive order related to cryptocurrency next week.
Is Crypto Laundering Getting Difficult?
Chainalysis research shows more than $3 billion in money stolen from DeFi platforms in 2021
While ransomware is still a threat, Chainalysis research shows that fraud and theft of digital assets increased significantly in 2021, by more than 500%.
Still, cryptocurrency laundering — especially with federal attention to illegal activity — has become increasingly difficult.
“There is no such thing as cryptocurrency crime,” said Redbord, a former US Treasury Department official. “Crypto is the means of transferring value in many crimes – from child exploitation to cyberattacks, from ransomware to terrorism financing.”
In a recent development in the Bitfinex hacking case, unsealed court documents showed that Lichtenstein and Morgan used stolen digital assets to invest in NFTs, gold and a $500 gift card for Walmart, illustrating the increasingly sophisticated tools and techniques used used to hide their activities to the Wall Street Journal. Speaking at the Munich Security Conference, Monaco said the arrests of the suspects were a highlight of NCET’s recent work.
Warning about Russian hacking attempts
Monaco also referenced CISA’s recent joint advisory statement this week discussing new TTPs being carried out by Russian threat actors. She said organizations would be “stupid” if they didn’t take protective measures to protect against cyber threats from Russia and urged them to patch systems and follow the procedures outlined in the advisory statement (see: According to agencies, Russian hackers are targeting defense contractors).