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Crypto Crime: Man Sentenced 5 Years in Prison For Buying a Gun with Cryptocurrency

Recently, US Border agents have identified ’48 years-old man, David Mitchell who bought a gun online in the US using cryptocurrency worth more than £2,000. Mitchell had ordered a package of a Glock 9mm gun with magazine, silencer and 150 rounds of 9mm ammunition. Court convicts actions as unlawful He was first arrested on September 19, 2018, by the Organized Crime Partnership (OCP) (Scotland) which came into existence on September 01, 2018. The body was initiated to combat organized crime with the collaboration of Scotland Police and the National Crime Agency. David’s arrest is the first case OCP since they started as a joint task force. At first, he ordered the packed using cryptocurrency Task force secretly scrutinized him, seized the package he ordered and sent a dummy package (known as placebo) instead. Later, the man caught ‘making arrested for using dark web’ and questioned over the transaction   On Monday, January 13, 2019, the Mitchell was presented before Judge Lord Pentland and eventually, he sentenced him five years in prison for his action. The hearing at High Court in Edinburgh concluded, “It appears that your decision to acquire the gun and the other items arose from an obsessive preoccupation on your part with exploring whether it was possible to do so by making use of the dark web”. The court further continued, “You must have appreciated that this was unlawful. For this conduct, you must be punished.” Further, on Mitchell’s part, there’s no information revealed as to what motivated him to perform the act. Detective Chief Superintendent Gerry McLean who is the lead in charge of ‘Police Scotland praised the newly formed ‘OCP’s work and said; David Mitchell never offered any information that would have allowed us to better understand what his motivation was to secure a firearm. What’s your take of increasing illicit activities using cryptocurrency? Share your thoughts. The post Crypto Crime: Man Sentenced 5 Years in Prison For Buying a Gun with Cryptocurrency appeared first on Coingape.

Romanian Coinflux Crypto Exchange Founder to Be Sent to US for Crime, Fraud and Money Laundering

International law is tricky and so is an international business, in between the gray areas lies pertinent questions about knowledge and responsibility. Something that the founder of the Romanian crypto exchange Coinflux, Nistor Vlad Calin, is learning about. What Is The Case According to reports from a local media source, this week, the courts have confirmed his extradition to the United States. Calin was arrested in his native country last year, based off a warrant issued in the US for alleged offenses related to organized crime, money laundering and fraud that were orchestrated via his crypto exchange. The warrant was issued after the American secret service was following a case and claims that he aided and abetted in laundering money for criminal activity on US soil. These allegations have been strenuously denied by Nistor Vlad Calin and his lawyer Anatol Panzaru., who appealed to the Bucharest Court of Appeal on his client's behalf. The lawyer pointed out that his client is being made a scapegoat and that the extradition is going ahead even though there are some conditions of the treaty on judicial cooperation between the two nations that have not been met. Panzaru has repeatedly claimed that this is a witch hunt as his client had no prior knowledge of these transactions. Furthermore, there was no way for Calin to know that the coins in question were obtained via fraudulent means or sent to bolster nefarious activities. Thus the extradition request should be rejected until these facts are ascertained. What Are The Chances It appears the plea might fall on deaf ears based on recent precedent. In December, the Supreme Court of Greece had dealt with a similar case involving the extradition of the supposed operator of the now-defunct crypto exchange BTC-e, Alexander Vinnik. Vinnik is now to be sent to France for similar money laundering related crimes, from where he is expected to be sent to the US to stand trial. This is certainly virgin territory for courts, however, these actions have made it clear that businesses need to proceed with extreme prejudice as they will be held liable for, not just their actions but also for any wrongdoings that they might have inadvertently facilitated. Whether this is an overreach or a cautionary approach by law, that is up for debate.
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LexisNexis Risk Solutions Warns Against UK ‘Complacency’ in Fight Against Financial Crime

London remains the money laundering capital of the world, while UK plc spends increasing amounts on fighting financial crime Senior money laundering experts agree that more needs to be done to improve efficiencies in the UK’s fight against dirty money, new report by LexisNexis Risk Solutions reveals The current regime of sanctions and penalties may well be viewed by criminals as merely the ‘cost of doing business’ LexisNexis Risk Solutions, the global information solutions provider, warns that the UK is at risk of becoming complacent in its fight against money laundering. Whilst significant efforts are being made across the financial and professional services sectors, financial criminals remain one step ahead. Huge investments are being made by business to fight these crimes, but London still represents the money laundering capital of the world.  Collectively, the country needs to do more to detect and prevent it. This warning from LexisNexis Risk Solutions comes just days after the Financial Action Task Force (FATF) published its Mutual Evaluation Report into the current state of anti-money laundering and counter-terrorist financing measures in the UK. The FATF declared that the UK has a ‘well-developed and robust regime to effectively combat money laundering and terrorist financing.’ As a result, LexisNexis Risk Solutions fears that the UK may believe its current measures are sufficient when it comes to detecting, preventing and deterring financial crime. But the problem is getting worse. Senior money laundering experts agree; more needs to be done to dissuade criminals from undertaking illicit activities in the UK. The current regime of sanctions and penalties is seen merely as a cost of doing business, and as stated by a senior Economic Crime expert from law enforcement, there is strong desire to see “more criminals in prison and more assets denied and seized from those criminals,” effectively hitting them where it hurts. The ‘Money Laundering Exposed’ report from LexisNexis Risk Solutions examines the current state of anti-money laundering compliance according to senior money laundering experts across the public and private sectors. The report contains the opinions of a broad range of representatives from some of the UK’s leading banks, from both financial and professional services firms, as well as a senior financial crime director from law enforcement and a former regulator. Financial crime is a national issue, affecting all regulated industries, the Government, and the average person on the street. However, some aspects of the regulatory framework, such as the regulator’s need for transparency, are preventing the roll out of useful tools, including analytics and artificial intelligence. According to one senior global financial crime executive at a leading UK bank, these tools could represent “a real breakthrough,” in the UK’s fight against money laundering. Separately, she stresses the need to “join the dots across different areas” to adequately fight financial crime. Michael Harris, Director, Financial Crime Compliance and Regulatory Risk at LexisNexis Risk Solutions comments: “It’s fair to say that the UK has come a long way in strengthening its defences against financial crime in recent years. However, it would be disastrous for us to halt progress now or become complacent in our approach. Financial crime is on the rise – it pernicious, pervasive and present – and the only way to truly combat it is to work together, armed with the latest technologies and the power to hit criminals where it hurts. The UK needs to send a clear message to criminals – that the UK is not a money laundering hub but instead a force to be reckoned with.”   The post LexisNexis Risk Solutions Warns Against UK ‘Complacency’ in Fight Against Financial Crime appeared first on The Fintech Times.
The Fintech Times

How Blockchain Can Be A Solution For Cyber Crime And More Right Now

We've frequently been on the beat when it comes to blockchain and how it can be a resource for the emerging cyber crime space. The issue of cyber crime and how blockchain is a plausible solution for many of these types of crime is now on the radar on the of the Department of Homeland Security (DHS). The Science and Technology Directorate (S&T) arm of DHS announced last month that it is seeking innovative solutions from startups to enhance anti-forgery and counterfeiting capabilities for digital documentation through a new solicitation, "Preventing Forgery and Counterfeiting of Certificates and Licenses," under S&T's Silicon Valley Innovation Program (SVIP). S&T seeks solutions that use blockchain and distributed ledger technology (DLT) to issue digital documentation to prevent fraud, counterfeiting, and forgery. DHS says it is open to startups and small businesses that have not had a government contract in the past 12 months totaling $1 million or more and that have less than 200 employees at the time of application. "SVIP is a bridge between the early-stage startup community and the Homeland Security Enterprise," S&T SVIP managing director Melissa Oh said in a prepared statement. "DHS has need of the innovations coming from this community to ensure we are at least a step ahead of national security threats. By releasing this solicitation, we are asking the innovation community to contribute to this work through the application of commercial solutions to homeland security use-cases."    All of this brings up a question we've been wondering lately: what in the world is going on with blockchain? Media attention was bearish on blockchain for much of the latter half of 2018. Specifically, we've wondered how is blockchain going to achieve scale any time soon, and how is it going to avoid the massive energy expenditure that it currently needs for miners to find bitcoins. For that matter, will it ever achieve enterprise applications, or will it forever remain associated with bitcoin and cryptocurrencies above all? Arielle Telesmatic is director of emerging technologies at the Scroll Network, a company that develops blockchain networks. In fact, Scroll's Aster blockchain may be just the thing that DHS might find appealing. "Many companies need to reduce the hurdle to adoption through a clear understanding of how the technology has significantly progressed since the inception of let's say, the power-sucking congested ...Full story available on

The Challenges of Investigating Cryptocurrencies and Blockchain Related Crime

This is a good paper that summarizes the challenges of crypto-related crimes: Abstract: We increasingly live in a world where there is a balance between the rights to privacy and the requirements for consent, and the rights of society to protect itself. Within this world, there is an ever increasing requirement to protect the identities involved within financial transactions, but this makes things increasingly difficult for law enforcement agencies, especially in terms of financial fraud and money laundering. This paper reviews the state of the art in terms of the methods of privacy that are being used within cryptocurrency transactions, and in the challenges that law enforcement face. Conclusion: The strive for anonymisation within the blockchain infrastructure will continue, and thus the long-term goal must be to start to regulate for the mapping of real identity into anonymised ones. The software which produces the transactions will thus have to keep a track for the mapping of a sovereign identity to anonymised one. Only with strong cryptography can we make sure that this is implemented in a trusted way. The author proposed a "regulatory mapping" solution to tackle crypto-related crimes. This is feasible, but goes against the whole idea of decentralization. What is your opinion on Privacy vs. Regulation? Decentralization vs Centralization?
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This weekend was pretty calm. The market still continues to decline, and, as usual, the voices of bulls are becoming more and more faint. Meanwhile, it turns out that the Bitcoin name was trademarked for at least 10 years in the UK. Read further to know what's going on.

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BAT Outperforms Bitcoin, XRP On New Brave Browser “Rewards” Feature

Brave Browser Announces BAT “Rewards” Feature On Tuesday, Brave Browser, a crypto-friendly internet application headed by the founder of Mozilla Firefox, Brendan Eich, made a surprising announcement, seemingly aiming to start of 2019 with a proverbial bang. Via a company release, conveyed through its in-house blog, the Brave and Basic Attention Token (BAT) team, which consists of Eich, coupled with an array of fintech, Silicon Valley, and crypto veterans, revealed that it would be previewing “opt-in ads in [the] desktop browser developer channel.” While this feature sounds nebulous, there’s more to this integration than meets the eye. In fact, as broken down in a PC Magazine feature article, this new advertising model will allow common Joes and Jills to earn crypto, in the form of BAT, and potentially other rewards in the feature. This new offering, dubbed Brave Rewards, will siphon 70% of earned ad revenue to users who agree to view advertisements. The remaining 30% will be paid to Brave’s war chest — a likely controversial play, but one necessary for the blockchain project’s long-term survival. Rewards will be available via Brave’s developer/test browser edition. It wasn’t exactly divulged when the innovative feature would hit the publics’ desktops, but the following GIF is how the feature will work: Looking outwards, the Brave team revealed that they expect opted-in users to earn upwards of $60 to $70 a year in the near future, with their preliminary projections predicting that $224 a year could be earned by 2020 through Brave’s in-house ecosystem. While this sounds great — an effective free $224/year for viewing ads — like all things too good to be true, there’s a catch. At the time of writing, Brave has announced support for BAT token withdrawal, as the company wants Rewards’ users to reward their favorite content creators, whether it be large new portals or Youtubers. After this feature goes live successfully, Brave intends to activate “publisher-integrated ads,” which will allow content creators to feature “private ads” on content creators’ pages through the startup’s systems. The company subsequently explained its Brave Ads offering and its applications/benefits from a top-down perspective, writing: With Brave Ads, we are reforming an online advertising system which has become invasive and unusable. Users have turned to ad blockers to reclaim their privacy from ads that track them and sometimes even infect them, and publishers are finding it increasingly difficult to earn ad revenue to sustain quality content with intermediaries that collect huge fees. It is important to reiterate that at this time, this newfangled feature is technically in its beta phase. Due to this positive news, the popular altcoin, which recently gained the support of industry powerhouse Coinbase, has posted a respectable price gain. At the time of writing, BAT is currently valued at $0.125 apiece, posting a 3% in the past 24 hours. The crypto, currently the 36th in this market’s standings, is currently outperforming Bitcoin (BTC) by 2.7%, and Ethereum (ETH) by 2.4%. Crypto Lulls: Bitcoin, Ethereum, XRP Post Barely Any Movement In the same vein of cryptocurrency prices, the broader market has posted close-to-zero movement in the past 24 hours. Per data from Coin Price Watch, BTC has found itself at $3,645 — a mere 0.58% gain over the past day. Other leading crypto assets have also posted slight gains, but have still underperformed BAT. XRP, the go-to asset for fintech upstart Ripple, is up 1.27%, as it sits just shy of the $0.33 price level at $0.3296. ETH, which recently tumbled due to the delayed Constantinople fork, has found itself up by 2%, regaining a portion of the losses incurred yesterday. While the market is trending slightly positive, some analysts expect that BTC is ready to dive. Speaking to MarketWatch, Jani Ziedens of Cracked Market claimed that BTC, if truly oversold, should be posting monumental gains right now, rather than finding itself in an extended lull. So, Ziedens added that this “lethargic base” indicates that demand is limited, “incredibly weak” even, and as such, lower crypto bottoms may be inbound. BAT Title Image Courtesy of via Flickr The post BAT Outperforms Bitcoin, XRP On New Brave Browser “Rewards” Feature appeared first on Ethereum World News.
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Cryptopia Hacker Moves Stolen Crypto to Binance; Community Alerts CZ and Funds Are Frozen

It is clear that hackers gave themselves a place to stay in the cryptocurrency industry, which was only made more evident by a recent security breach that happened over the last few days. Cryptopia, a leading exchange in New Zealand, announced a breach that ended in a major theft on January 14th. However, unlike the unfortunate tale that many other exchanges succumb to, that is not the end of the story. The official statement notes that Cryptopia has placed itself into a maintenance mode, helping them to protect their accounts until the regulatory authorities of New Zealand provide other details. Both the High Tech Crimes Unit and the local police are pursuing investigative efforts, though they have commented that “a significant value of cryptocurrency may be involved.” At this point, the actual amount has not been released, and no substantial details have been provided. Still, that has not stopped local news portal Radionz from reporting that the loss is close to $3.6 million. A Twitter user, ShaftedTangu, seems to know where these digital assets are going. On the posts, the user said, Hey @cz_binance Binance has stolen tokens from Topia hitting it sir. Can you lock it down? — I Dream Of Alts (@ShaftedTangu) January 16, 2019 Through a string of additional tweets, the user continued to track the funds, as he mentioned wallet address 0x9007a0421145b06a0345d55a8c0f0327f62a2224. In another tweet, he claimed, “Currently the 0x900 wallet contains around $10 mil USD of tokens, large amounts are $PRL $2mil, $CENNZ $1.168 mil, $Denacoin $2.73 mil, $MSP $0.99 mil” Luckily, just under four hours after the original tweet, CZ Binance replied. The reply said, Just checked, we were able to freeze some of the funds. I don't understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It's a high risk maneuver for them. — CZ Binance (@cz_binance) January 16, 2019 With such a nonchalant type of reply, it is quite a victory for Cryptopia and Binance that the funds could be frozen at all. However, the victory has not been won yet, considering there is no indication of exactly who performed the hack in the first place. Cryptopia has remained silent, though they posted to their own Twitter profile, saying, “We cannot comment as this matter is now in the hands of the appropriate authorities. We will update you as soon as we can.” As a result of these issues, Zhao posted that users should keep their holdings on exchanges, rather than a hardware wallet. However, his post caused an onslaught of negative replies, with some saying that his post implied that self-storage is substantially riskier than storing on a seemingly “reputable” exchange. Zhao later retracted, saying that he was not advising investors to store funds on exchanges. In the first half of 2018 last year, there was over $731 million lost in thefts involving exchange hacks. However, none have reached the severity experienced by the 2014 Mt. Gox hack.
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Binance Freezes ‘Some of the Funds’ Stolen in Cryptopia Hack

Some of the stolen cryptocurrency from yesterday’s Cryptopia hack has been sent to Binance, which has confirmed already freezing some of the funds.  Binance Freezing Funds Stolen from Cryptopia Twitter account @ShaftedTangu has alleged that some funds stolen as a result of Cryptopia’s hack have been siphoned through Binance. The amounts sent to Binance in question include roughly $7,500 in Metal (MTL) 00, $6,750 in KyberNetwork coin (KNC) 00, $7,181 OmiseGO tokens (OMG) 00, and $8,724 in EnjinCoin (ENJ) 00. All of it totals around $30,000. Changpeng Zhao, CEO at Binance – the world’s largest cryptocurrency exchange by means of traded volumes, has confirmed the allegations, reassuring that they’ve already frozen some of the funds. Zhao commented: Just checked, we were able to freeze some of the funds. I don’t understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It’s a high-risk maneuver for them. Just checked, we were able to freeze some of the funds. I don't understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It's a high risk maneuver for them. — CZ Binance (@cz_binance) January 16, 2019 Bitcoinist reported yesterday that Cryptopia’s security has been breached, resulting in ‘significant losses’. Police in New Zealand also confirmed. Binance Caught in the Fire Zhao’s tweet caused a reaction in crypto Twitter’s community as one user (@Crypto_Bitlord) expressed his bewilderment that Zhao referred to “social media” as a means of reporting rather than Binance’s own surveillance systems. I’m genuinely shocked stolen funds from @Cryptopia_NZ have easily passed through @binance UNDETECTED until social media flagged them. This raises some big questions. How is that possible with modern blockchain analysis? — Sir Bitlord (@Crypto_Bitlord) January 16, 2019 On the matter, Binance’s CEO said: It’s quite easy to generate a brand new address. We (and no one) recognize every transaction out there. We already have very in-depth and detailed blockchain analysis. Yet, the question remains – if a regular Twitter user has been able to detect the transaction in question, how, and more importantly – why did Binance miss it? Perhaps the better question, as posed by @Crypto_Bitlord is: So you are saying criminals can steal funds and just create a brand new address to send to before binance? In the meantime, Binance announced today the launch of their Binance Jersey fiat exchange. The platform is aimed at traders from Europe and it offers BTC/GBP, ETH/GBP, BTC/EUR, and ETH/EUR trading pairs. What do you think of Binance missing the transactions in question? Don’t hesitate to let us know in the comments below! Images courtesy of Shutterstock The post Binance Freezes ‘Some of the Funds’ Stolen in Cryptopia Hack appeared first on
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