Criminals are increasingly laundering proceeds of crime through cryptocurrencies due to the afforded anonymity, ease of use, and ability to circumvent international borders and legislation.
The Australian Federal Police (AFP) has established a new cryptocurrency unit dedicated to targeting this activity, as outlined in the Financial Review.
Seizing crypto assets
A key focus of the newly established unit is seizing illicit crypto assets to ensure that criminals cannot enjoy the proceeds of their crimes.
“You’ve got to be attacking the wealth and the business models of organised crime, as well as trying to disrupt and arrest,” said Stefan Jerga, AFP National Manager Criminal Assets Confiscation.
The increased focus on illicit money transfer via cryptocurrencies comes as the AFP has confiscated more than $600 million in criminal assets ahead of its target date.
“The environment was such that we felt a standalone team [was required], rather than a lot of officers picking up some of this skill set as part of their overall role,” Mr Jerga said.
Enhanced investigative capabilities
While the crypto gains seized are small compared to “traditional” asset seizures such as property and cash, the dedicated crypto focus provides great intelligence insights.
Mr Jerga explained that the newly established cryptocurrency unit is “Also providing that valuable, investigative tracing capability and lens for all of our commands across all of our businesses, whether they’re national security-related, child protection, cyber – or the ability to trace cryptocurrency transactions across the relevant blockchains.”
This intelligence will support the AFP’s larger focus on preventing money laundering, fraud, and other crimes in the first instance rather than subsequently recovering criminal proceeds.
What happens to recovered proceeds of crime?
Recovered criminal proceeds, which may include crypto as well as traditional assets, are held by the Australian Financial Security Authority in the government’s confiscated assets account.
Mr Jerga said proceeds go into online child safety programs, the DNA for the missing persons project, the wastewater analysis program, the Daniel Morcombe Foundation, Cowards Punch initiative, and other community initiatives such as Crimestoppers.
Key takeaways
The AFP has established a new cryptocurrency unit to target those who use cryptocurrencies to perpetrate crimes and launder the proceeds. The unit will focus on seizing illicit crypto assets and providing intelligence that facilitates investigations across a wide range of criminal activity with a crypto link.
