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Cops con crooks with app-hundreds arrested globally for drugs, money laundering and murder plots

Australian and US police use encrypted app to trick drug dealers, money launderers and potential murderers, China’s crypto crackdown continues with hundreds of money laundering arrests, and artists not in frame of UK’s new anti-money laundering regulations

Napier AI
June 11, 2021

Australia and FBI duped crooks into discussing drugs, financial crime and murder on messaging app

A multi-national sting operation led by the Australian Federal Police (AFP) and the United States’ FBI has culminated in 800 arrests in 18 countries around the world. Australia alone recorded 224 arrests.

Using the umbrella codename Operation Trojan Shield, the bust was a cooperation between law enforcement agencies from Australia, the USA, New Zealand, the UK and the EU.

The sting was initiated in the USA in 2018, when FBI officials took control of ANOM, an encrypted app service.  Until very recently, devices with the app were popular with criminals, who believed the messaging service was secure as its camera, voice, email, and location capabilities were disabled.

Devices with the FBI-run app were surreptitiously distributed to organised crime groups worldwide through a network of informants and undercover agents over approximately 18 months. In all, AFP and FBI officials decrypted 27 million messages discussing a range of criminal activity, with 20 000 of the devices being used by some 300 criminal organisations in over 100 countries.

Ironically, Australia’s flamboyant fugitive and suspected drug dealer, Hakan Ayik, unknowingly assisted authorities with uptake of the app. A respected underworld figure, he trusted and encouraged using the service amongst his associates.

Australian Prime Minister Scott Morrison led worldwide praise for the sting operation, calling it "a watershed moment in Australian law enforcement history."

Read more on this story at the BBC.

Chinese police arrest 1100 suspects and bust 170 cryptocurrency gangs involved in money laundering

Those arrested were suspected of using cryptocurrencies to launder proceeds from telephone and Internet scams and the clamp down is further demonstration of the country’s drive against financial crime in the crypto-trading sector.

It follows last month’s announcement by three influential state-backed financial service agencies, in which cryptocurrency dealings of any sort within the ranks of their member organisations were banned outright. The State Council also committed to the crackdown, and several crypto-related Weibo accounts were blocked during last weekend.

According to China’s Ministry of Public Security, the 1100 people arrested are suspected of laundering money for criminal clients. The suspects allegedly profit by charging their clients 1,5 to 5% of the ill-gotten gains converted into virtual currency through crypto exchanges.

The recent intensification of the campaign to combat money laundering in cryptocurrency trade by Chinese authorities comes in the face of an increase in the number of crimes identified within the sector. China’s Payment & Clearing Association explained on Wednesday that the anonymous and global nature of virtual currencies means that “they have increasingly become an important channel for cross-border money laundering.

Read more on this story at Reuters.

Relief as UK’s new anti-money laundering regulations leave artists out of the picture

There was widespread relief amongst UK visual artists recently, as the country’s new anti-money laundering (AML) regime came into force yesterday, with last month’s confirmation from the UK Treasury that they are exempted from the regulations. Artists have been in limbo over whether they would be classified as Art Market Participants (AMPs) for almost 17 months.

The AMP classification would have required working artists who participate in transactions of €10 000 (£8600) or more to register with Her Majesty’s Revenue and Customs (HMRC) department. This would have meant that as of yesterday, artists would be subject to financial and AML compliance implications which could be onerous and unmanageable for many in the sector.

The fine art world has long been seen as a risk area for money laundering due to its tradition of anonymous clients, proxy buyers and large exchanges of funds with minimal due diligence. This vulnerability resulted in London’s galleries receiving unwelcome attention from the National Crime Agency (NCA) in March.

The HMRC announced the good news for artists late last month, stating that “HM Treasury have recently confirmed that it is not intended that artists — persons who create original art — are in scope of the AMP definition and therefore they are not required to register as an AMP.

Read more on this story at The Art Newspaper.

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