Multi-Million Bitcoin ATM Scheme Exposes Holes in EU's Money Laundering Net
Spain’s Guardia Civil (Civil Guard) police unit has indicated that current rules in Europe are inadequate with regards to discouraging the use of Bitcoin ATMs to launder money.
According to Bloomberg, this deficiency results from the fact that the owners of the Bitcoin ATMs are not required by the strict AML regulations to vet users of the cryptocurrency vending machines.
This has come to the fore two months after the special police unit from the Southern European country took down a criminal organization that used the Bitcoin ATMs to launder proceeds on behalf of narco-traffickers. The ‘Crime-as-a-Service’ money laundering operation reportedly cleaned over €9 million ($10.15 million) before it was dismantled.
Cryptocurrency laundering as a service: members of a criminal organisation arrested in Spain | Europol https://t.co/dTC1EXTcmG
— Philippe Vynckier (@PVynckier) May 9, 2019
Money launderers for hire
As CCN reported at the time, the gang hired two crypto ATMs and installed them in Madrid. The vending machines were advertised as devices that anyone could use to buy and sell cryptocurrencies.
To load the devices with cryptocurrencies, the gang which had used false identities to register, would withdraw money from multiple bank accounts and send it to the Bitcoin exchanges. This offered the cover needed to make the large transfers without raising suspicion. Once they had obtained Bitcoins these would then be sent to drug traffickers in Colombia and other countries. The two Bitcoin ATMs used in the money laundering operation were seized as well as four cold wallets and 20 hot wallets.
