The Nigerian securities regulator said on June 21 that it had amended the digital asset rules to expand their scope and introduced an accelerated process for onboarding virtual asset service providers. The Accelerated Regulatory Incubation Programme provides VASPs with insights into the Commission’s expectations before they fully commence operations. Regulator Threatens Enforcement Action Against Non-Compliant […]
Bitcoin News
Law Enforcement Holds Positive Views on Crypto Despite Crime Concerns, Chainalysis Reports
Blockchain analytics firm Chainalysis has found that law enforcement finds cryptocurrency relevant to many investigations and holds positive overall views. The firm also notes the growing adoption of cryptocurrency and its increased criminal exploitation, including intellectual property theft and drug trafficking. Despite the availability of various tools, many respondents are dissatisfied with current resources, highlighting […]
Bitcoin News
German Law Enforcement Transfers $425M in Bitcoin From Seized Funds
Onchain data reveals that an entity likely tied to Germany’s Federal Criminal Police Office (BKA) transferred 6,500 bitcoin, valued at approximately 5 million, on June 19. Arkham Intelligence identified the address on Jan. 31 through its onchain monitoring systems. German Authorities Transfer Seized Bitcoin About four months ago, Arkham Intelligence announced on the social media […]
Bitcoin News
SEC’s Crypto Enforcement Chief Departs After 9 Years
The head of the Crypto Asset and Cyber Unit at the U.S. Securities and Exchange Commission (SEC)’s Division of Enforcement has left the agency after nine years of service. Under his guidance, the SEC took many enforcement actions against crypto firms, including major crypto trading exchanges Binance and Coinbase. SEC’s Crypto Enforcement Unit Leader Departs […]
Bitcoin News
American Securities Association Sues SEC Over Lack of Transparency in Enforcement Actions
The American Securities Association (ASA) filed a lawsuit against the U.S. Securities and Exchange Commission (SEC) on Thursday for failing to comply with the Freedom of Information Act (FOIA). The ASA seeks to compel the SEC to disclose records related to its “recordkeeping sweep initiative” that imposed penalties on broker-dealers for retaining off-channel communications, such […]
Bitcoin News
Chinese Fraud Victims Seek Government Aid in Recovering 61,000 BTC Seized by UK Law Enforcement
A group of Chinese victims of a billion fraud scheme have requested assistance from their country’s foreign ministry in recovering 61,000 bitcoins, seized from a fraudster and her associate. The fraud victims have strongly opposed attempts to transfer the ownership of these bitcoins to the U.K. government. Petition Garners More Than 2,500 Signatures A […]
Bitcoin News
Federal Reserve Ends Enforcement Action Against FTX-Connected Farmington State Bank
The Federal Reserve terminated its enforcement action against Washington-based Farmington State Bank, previously known as Moonstone Bank and linked to FTX’s Alameda Research.
Federal Reserve Terminates Enforcement Action of FTX-Linked Farmington Bank
The Federal Reserve Board has officially concluded its enforcement actions against Farmington State Bank and its parent company, FBH Corporation. This termination marks the end of a scrutinized period for the Washington-based bank, once intertwined with the now-defunct cryptocurrency exchange FTX.
Farmington State Bank, previously operating under the moniker Moonstone Bank, found itself at the center of regulatory oversight following its association with FTX’s trading arm, Alameda Research. The Federal Reserve’s decision to terminate the enforcement action comes after the bank completed its wind-down plan, effectively ceasing its banking operations.
The enforcement action, initiated in July 2023, aimed to ensure the orderly wind-down of Farmington’s operations, safeguarding the interests and deposits of its customers. The Federal Reserve in the recent announcement stated:
The Board’s enforcement action…ensured the bank’s operations would wind down in a manner that protected the bank’s depositors. Farmington has completed its wind down plan and no longer functions as a bank.
This move also coincides with the termination of two long-standing enforcement actions against BNP Paribas, showing the Federal Reserve’s willingness to close regulatory chapters with institutions that have complied with mandated corrective measures.
The link between Farmington Bank and the volatile world of cryptocurrency trading came under scrutiny after it received approximately .5 million from Alameda Research through FBH Corporation in March 2022. The collapse of FTX in November 2022 prompted a re-evaluation of Farmington’s engagement in the crypto space, with the bank expressing its intent to revert to its role as a community bank.
Do you think the Federal Reserve did a good job of handling Farmington State Bank? Share your thoughts and opinions about this subject in the comments section below.
Monero Tracing: Privacy Coin Proponents Dismiss Finnish Law Enforcement Agency’s Tracing Breakthrough Claims
A Finnish law enforcement agency, the National Bureau of Investigation (NBI), recently claimed that it may have found a way to trace the privacy coin Monero. However, proponents of the privacy coin have dismissed the agency’s claims and insisted that the cryptocurrency is still untraceable.
Identification of Hacker Behind Vastaamo Data Breach Revealed
The Finnish law enforcement agency, the National Bureau of Investigation (NBI), recently claimed that it has found a way of identifying individuals who use the privacy coin Monero (XMR) to launder money. To back this claim, the agency produced a report explaining why it concluded that Julius Aleksanteri Kivimäki was the criminal behind the Vastaamo breach.
Finnish authorities have long believed Kivimäki to be the cybercriminal behind the hacking of the private psychotherapy service provider Vastaamo’s patient database in October 2020. After gaining access to patients’ records, Kivimäki demanded 40 bitcoins (BTC) in exchange for not publishing these records. He similarly threatened Vastaamo’s 30,000 patients.
However, almost two years later, Kivimäki was identified as a hacker by the NBI and was charged in absentia for crimes ranging from aggravated data breach and attempted extortion to breach of confidentiality and falsification of evidence. An Interpol arrest warrant was subsequently issued, and this ultimately led to Kivimäki’s arrest in early February 2023. He was later extradited to Finland.
As noted in a local report, the NBI has not produced verifiable proof to support Monero tracing breakthrough claims. The investigative report, which reveals how this feat was achieved, is heavily redacted. The head of the investigation, Marko Leposen, defended NBI’s decision not to divulge details of how it traced XMR transactions.
Despite providing scant details on how the NBI managed to identify Kivimäki, the agency’s document reportedly showed how the hacker attempted to obscure the movement of the funds by switching from BTC to XMR and hopping between crypto exchanges. It also revealed how Kivimäki used mules to move the funds.
NBI’s Monero Tracing Claims Dismissed
Meanwhile, some proponents of the privacy coin have dismissed the Finnish law enforcement agency’s assertions. According to them, no tracing of Monero transactions happened in this case.
For instance, on Reddit, one user suggested that the NBI’s only success was tracking “a certain person who used centralized exchanges and swapped monero for traceable cryptos. They noticed that the amounts were similar and deduced that it was the same monero.” As far as tracking XMR is concerned, the user insisted that this is still not possible.
Another user similarly suggested that the agency’s only breakthrough, in this case, was realizing that a “similar quantity was exchanged from bitcoin to monero, then was deposited into Binance.
Do you believe the Finnish law enforcement agency Monero tracing claims? Let us know what you think in the comments section below.
SEC Crypto Enforcement Reached New High in 2023
U.S. Securities and Exchange Commission (SEC) crypto enforcement skyrocketed in 2023, with more than a 50% increase in crypto-related enforcement actions compared to 2022, according to a new report. The securities regulator “continues to view cryptocurrency-related enforcement as a top priority, bringing 46 enforcement actions against various digital-asset market participants,” the report details.
SEC Prioritizes Crypto Enforcement
Cornerstone Research released a report this week titled “SEC Cryptocurrency Enforcement,” revealing that the SEC’s enforcement focus on digital assets reached a new high last year.
“The Securities and Exchange Commission (SEC) continues to view cryptocurrency-related enforcement as a top priority, bringing 46 enforcement actions against various digital-asset market participants in 2023,” Cornerstone Research described, elaborating:
This number is the highest since 2013 and a 53% increase from 2022.
“In the first quarter of 2023 alone, the SEC brought 20 actions, the highest number in a single quarter,” the report adds.
The report outlines that “of the 46 enforcement actions, the SEC brought 26 litigations in U.S. federal courts and 20 administrative proceedings in 2023. There were more than triple the administrative proceedings from last year, and the number of litigations increased slightly. The SEC imposed 1 million in monetary penalties for settlements reached.”
In 2023, about 37% of the SEC’s enforcement actions were linked to initial coin offerings (ICOs), a decrease from the 47% reported in 2022. Among the 17 ICO-related actions, 82% involved fraud allegations. Notably, the SEC initiated two administrative proceedings related to non-fungible tokens (NFTs) for the first time.
The report details:
Chair Gensler has noted that ‘enforcement is a tool, not the destination,’ and the number of SEC enforcement actions brought in the crypto space has ramped up over the last two years.
The SEC brought charges against 124 individuals or entities in cryptocurrency enforcement actions in 2023, with 54% being individuals and 46% representing firms. Notably, the percentage of enforcement actions solely targeting individuals decreased from 50% in the previous year to 39%.
What do you think about SEC enforcement actions against crypto individuals and firms hitting a record high? Let us know in the comments section below.
CFTC Files Civil Enforcement Action Against Bogus Crypto Exchange Debiex
The U.S. commodities regulator revealed on Jan. 19 that it had filed a civil enforcement action against a bogus digital asset exchange platform. According to the Commission, Debiex customers were not aware that the entire set-up was a clever scam designed to dupe prospective investors.
Romance Scam Tactics
The Commodities Futures Trading Commission (CFTC) announced on Jan. 19 that it had filed a civil suit against Debiex, a bogus crypto exchange platform it accuses of fraudulently misappropriating .3 million in customer funds. The CFTC alleges that the exchange’s representatives used romance scam tactics to fleece millions from the five unnamed prospective investors.
The Commission also identified Zhāng Chéng Yáng as a relief defendant because he is suspected of enabling Debiex’s fraudulent acts at least once. Commenting on the Commission’s move to file a civil enforcement action against the defendants, the CFTC’s Director of Enforcement Ian McGinley, said:
“This case is an example of the Division of Enforcement’s core mission—bringing justice for victims, rooting out misconduct, and holding accountable those who violate the anti-fraud provisions of the CEA.”
Fake Websites and Money Mules
In its statement, the Commodities Futures Trading Commission (CFTC) explained how Debiex perpetrated the scam from March 2022 to the present. The elaborate scam included websites that mimic legitimate trading platforms, fake customer service, and money mules. Using these tools masterminds of the scheme were able to convince victims that Debiex was a bona fide crypto exchange, the CFTC added.
However, according to the Commission, Debiex customers were not aware that the entire set-up was a clever scam designed to dupe prospective investors.
The Commission in the meantime urged prospective investors to avoid falling victim to similar scams by always verifying a company’s registration with the CFTC before committing funds.
What are your thoughts on this story? Let us know what you think in the comments section below.