According to a press release published this week by the U.S. Department of Justice (DOJ), three individuals from Miami have been arrested for their involvement in a scheme that used cryptocurrency to defraud U.S. banks. According to the indictment, the three defendants used stolen identities to buy more than $4 million in cryptocurrency and then falsely claimed that the cryptocurrency transactions were unauthorized. This deceived U.S. banks and a leading cryptocurrency exchange into reversing those transactions and depositing the ill-gotten funds into the defendants' bank accounts. According to the press release, the defendants' scheme resulted in U.S. banks processing more than $4 million in fraudulent transaction reversals and the cryptocurrency exchange losing more than $3.5 million in cryptocurrency. The defendants face multiple charges of fraud and conspiracy to commit fraud, and face over 30 years in prison.
A leading blockchain analytics firm recently released its midyear cryptocurrency crime update. The report finds that despite this year's downturn in cryptocurrency prices, illicit activity in the area is resilient. Among other things, the study found that illicit trading volumes are down 15 percent year over year, compared with a 36 percent decline for legitimate volumes. While scams and darknet activity are down as compared to 2021, hacks of exchanges and stolen funds buck the declining trend, with $1.9 billion of cryptocurrency stolen in hacks of services through July 2022, compared to just under $1.2 billion at the same time in July 2021.
For more information, please refer to the following links:
- Three Members Of Miami Crew Charged With Defrauding Banks And Cryptocurrency Exchange Of More Than $4 Million
- Mid-year Crypto Crime Update: Illicit Activity Falls With Rest of Market, With Some Notable Exceptions
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