Match Systems, a leading firm in anti-money laundering solutions, has released a new report on cryptocurrency misuse cases in Latin America.
The report reveals two significant illegal activities involving cryptocurrencies: a large-scale drug trade operation and a complex financial pyramid scheme.
The report is based on the research conducted by Match Systems after identifying suspicious cryptocurrency transactions related to drug funds. The firm found that a Telegram user, @uruguay_cocaiin_cannabis, used cryptocurrency for money laundering. The user was offering cocaine and cannabis for sale and accepting payments in various cryptocurrencies. The user also used a popular crypto exchange in Latin America to convert the illicit funds into fiat currency.
Match Systems also discovered that Elitepremium.ltd was conducting a crypto scam. The company claimed to be a legitimate investment platform offering extraordinarily high user returns. However, the company was running a Ponzi scheme, a fraud that paid existing investors with the money from new investors. The company used cryptocurrencies to attract and deceive investors, as well as to evade detection and regulation.
The report shows that crypto scammers and drug dealers may use renowned crypto exchanges in Latin America for money laundering. These exchanges should comply with their respective jurisdictions’ Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) regulations. However, the report suggests there may be gaps or weaknesses in these exchanges’ compliance and monitoring systems, which allow criminals to exploit them for their illicit activities.
Match Systems concluded that Latin America needs robust monitoring and regulation of cryptocurrency transactions, as it is evident that illegal activities, such as drug trading and financial pyramid schemes, often involve popular cryptocurrency exchanges. Therefore, enhanced AML/CFT measures are necessary to prevent the misuse of cryptocurrencies for illegal purposes and protect the crypto industry’s integrity and security.
