- The US Congressional Investigative Office published a report on money laundering through cryptocurrencies.
- This method is increasingly used, although traditional practices, such as smuggling and money laundering via international businesses, continue to be used.
- The FIU confirmed that the Jalisco New Generation Cartel (CJNG) and the Sinaloa Cartel use cryptocurrencies such as bitcoin.
Mexican drug cartels use cryptocurrencies to transfer their profits internationally and reduce the risks associated with the transportation of cash, indicates a report by the United States Government Accountability Office (GAO, for its acronym in English). ).
The Investigative Office of the US Congress published a report, dated December 2021. The document highlights that drug cartels change their illicit profits to cryptocurrencies; thus, they transfer them and, once they are received, they convert them into dollars and other current currencies.
“Specifically, there is evidence that Mexican and Colombian criminal organizations use virtual currencies to transfer their profits internationally, according to the ‘Drug Threat Assessment,'” says the GAO.
The Department of Justice and the United States Postal Inspection Service stated that drug cartels and transnational criminal organizations in general “increased the use of virtual currency due to the perception of anonymity and because it is a more efficient method of moving money around the world.” across borders.”
In its latest annual report, the US Drug Enforcement Agency (DEA) explains that, although various methods to move and launder illicit proceeds have been used for years, money launderers are increasingly using currencies. virtual networks to transfer the profits of criminal organizations on an international scale.
Traditional money laundering and remittance methods used by criminal organizations include bulk money smuggling and international trade-based laundering, the DEA says.
United States authorities found that the financial operators of the cartels receive the illicit profits and deposit them as large volumes of cash in a kiosk. There they are exchanged for cryptocurrencies and transferred to the digital wallets of other users.
With this method, the drug cartels reduce the risks of physically transporting these large volumes of cash; meanwhile, the owner of the destination digital wallet can convert them back into current currency.
The GAO report exposes that the operators of criminal organizations aim to hide their actions on purpose. In this sense, the use of virtual currencies further complicates the efforts of the authorities to estimate the amounts that are handled.
“Notwithstanding the data collected by federal financial regulators and law enforcement agencies, they provide some information about the use of virtual currency in human trafficking and drug trafficking,” the report highlights.
In Mexico, the Financial Intelligence Unit (UIF) of the Ministry of Finance detected that since 2019 criminal organizations operating in the country began to use virtual currencies. These are not integrated into the financial system because they are not recognized.
The Financial Intelligence Unit confirmed that drug cartels in Mexico such as the Jalisco New Generation Cartel (CJNG) and the Sinaloa Cartel use cryptocurrencies such as bitcoin.