US: a new task force against crypto scams



The news is official: a new task force against crypto scams called the Darknet Marketplace and Digital Currency Crimes task force (DNMDCC) has been created in the US. 

The news came from the US Attorney’s Office in the District of Arizona, as the US Attorney’s Office in Phoenix itself, Gary M. Restaino, co-authored the initiative. 

In fact, the task force was created by Restaino’s office, along with Arizona Homeland Security Investigations (HSI) Special Agent Scott Brown, Special Agent Al Childress of IRS Criminal Investigation, Special Agent Cheri Oz of the US Drug Enforcement Administration, and US Postal Inspection Service Inspector Greg Torbenson. 

The task force against crypto scams

The collaboration has actually been in place informally since 2017, when they began focusing on darknet drug sellers and cryptocurrency-related crimes. 

In particular, they have been concerned with detecting money laundering activities from illegal activities and using cryptocurrencies. 

As such criminal activities and enterprises have become more sophisticated, law enforcement agencies have had to adapt.

Thus was born the DNMDCC task force, which is also dedicated to crypto scams. 

In recent years there has been a conspicuous increase in the use of the Internet, including as a base network for the illegal sale and distribution of narcotics, firearms, personal data, child exploitation, and smuggling. 

What’s more, there has also been an increase in the use of digital currencies, which is why it was decided to create a special task force, active primarily within the District of Arizona.

The mission of the DNMDCC will be to stop and dismantle criminal organizations that exploit anonymity within the darkweb, or that use digital currencies to facilitate criminal activities. 

Technically, its concrete purpose will be to provide greater interagency collaboration. 

The use of cryptocurrencies

Recently the Homeland Security Investigations (HSI) revealed that it has come to seize nearly $4 billion in cryptocurrencies in total from illicit activities.

Although these are numbers that pale in comparison to the volumes of lawful trading (51 billion in the last 24 hours alone), it is still a figure that is beginning to become significant. That is, in percentage terms it is small, but in absolute numbers it is a significant figure. 

In reality, the percentage of money laundered through cryptocurrencies is still far less than that laundered through classic domestic fiat currencies, dollar first and foremost, but four billion dollars is certainly not a figure that can be ignored. 

Thus on the one hand the use of cryptocurrencies for criminal activities is on the rise, but it is still far less than the use of classic fiat currencies. 

Indeed, the very size of the figure reveals that law enforcement activity in this area is growing greatly. 

Presumably they are also learning ever more, and increasingly better, to exploit on-chain transaction tracking to analyze the situation and detect suspects. 

In other words, cryptocurrencies are not only helping criminals, but probably also the law enforcement agencies that are hunting them down. 

The comments

Phoenix prosecutor Gary Restaino commented on the news of the task force launch, saying: 

“We’ve done great work with our federal partners in the dark web and crypto space. This task force will enable us to continue the great collaboration with USPIS, DEA, IRS-CI and HSI, and I look forward to robust interdiction and prosecution efforts to deter digital crimes.”

HSI Special Agent in Arizona Scott Brown added:

“HSI and our partners have been working at the forefront of combating criminal activities facilitated through the use of cryptocurrency on dark web marketplaces and other anonymous platforms. This taskforce will have impactful repercussions on those criminal operators who attempt to grow their businesses and launder the illicit proceeds through advancing technology. HSI looks forward to growing in this investigative space alongside our law enforcement partners.”

Albert Childress, of the IRS Phoenix Field Office, commented saying: 

“IRS-CI is increasingly dedicating more investigative time and agent expertise to tackle darknet and cryptocurrency crimes. Our agents excel in addressing sophisticated cyber-related schemes and are up to the challenge of locating and apprehending criminals who try to hide in the digital world.”

DEA Special Agent Cheri Oz added: 

“DEA is committed to saving lives. Drug traffickers who are hiding in the darknet will be aggressively targeted and unmasked by this task force.”

Finally, Phoenix Division Acting Inspector of the US Postal Inspection Service, Glen Henderson, closed by saying: 

“The U.S Postal Inspection Service’s participation in this task force with our law enforcement partners and the Department of Justice underscores our commitment to keeping the U.S. Mail safe for all who handle and receive it. Dark web vendors and their operatives believe they can hide anonymously while perpetrating their crimes. The collaborative effort of this task force proves criminals operating on the web are never truly anonymous and they will be uncovered and prosecuted.”