- Latin American cartels are now using cryptocurrency to conceal and launder money.
- Mexican authorities called for more resources to enable them to track and halt suspicious transactions with crypto.
Bad actors in Latin American countries are using digital currencies like Bitcoin (BTC) to evade or conceal their illegal activities. Especially in Mexico, the local authorities informed that criminal syndicates in the country are increasingly adopting digital currencies to launder ill-gotten proceeds. There are already security measures set up to curb money laundering with cryptocurrency; however, the Mexcian financial intelligence unit said there isn’t enough staff to beat the criminals.
Crypto laundering in Latin America
Santiago Nieto, the head of the Mexican financial intelligence unit, highlighted how the criminals restructured their laundering games to avoid raising the alarm on either banking institutions or cryptocurrency exchanges. Per the report from Reuters, drug traffickers, and other bad actors launder ill-gotten proceeds by depositing small amounts of money in different banks – well below $7,500, which is the threshold that can raise suspicion.
Using these funds, they buy small quantities of Bitcoin on crypto exchanges, from which they can easily move the funds across other Latin American countries. On the side of exchanges, the Mexican authorities had made a law that required exchanges in the country to report transactions above $2,800. The regulation was formed to help the authorities to curb money laundering with digital currencies, and it has been effective.
More are resources needed to stop Latin American cartels
Although these security measures on the exchanges and banks are proving effective like, at least to some extent, Rolando Rosas, from the Cyber Investigations Unit said there is a need for more resources to effectively combat money laundering activities. He complained that the Cyber unit only has about 120 staff, which is only a quarter of the workforce needed to curb illicit transactions with Bitcoin.