On October 15, 2021, the Financial Crimes Enforcement Network (FinCEN) in the U.S produced a report titled ‘Financial Trend Analysis: Ransomware Trends in Bank Secrecy Act Data Between January 2021 and June 2021.’ This paper includes some critical insights exploring the association between crypto and malware detection financial fraud.
The paper appears to be heavily focused on the role digital currencies will play in ransomware in 2021. During the report’s analysis, the company claims to have discovered about $5.2 billion in departing BTC transfers likely connected to ransomware charges. It appears that during the first part of 2021, BTC has been the most popular ransomware-related means of exchange in financial records, followed by XMR (Monero).
The Growing Issue Of Cryptocurrency Ransomware
Among the most common ransomware variations identified by FinCEN is ‘REvil’, which is infamous for extorting users of cryptocurrencies such as Bitcoin. In the study, FinCEN details the offenders’ techniques for evading regulatory and legal agencies. When extorting victims, ransomware perpetrators often demand settlements in ‘confidentiality coins’ (like Monero or DASH).
Decentralized networks like Bitcoin underpin many confidentiality currencies. Unlike Bitcoin, they use complex cryptographic methods to disguise facts that could be used to discover address holders, current accounts, and possibly the quantity of crypto connected with particular transactions. Perpetrators are also making use of Tor to elude discovery, “prevent ‘chain bouncing’ and clearing out at major exchanges, and utilize mixing platforms and autonomous exchanges to transfer proceeds,” the research says.
While the independence inherent with digital currencies is more frequently viewed as an advantage, the negative aspect of this freedom is that financial fraudsters such as cybercriminals and embezzlers may access them. While this is not a concern for the typical user, it is a major bone of contention for authorities and one justification in favor of CDBC proponents.
Last Month US Sanctioned Crypto Exchange for Ransomware Fraud
Charges against the Suex cryptocurrency exchange were issued on September 21 for their involvement in a Ransomware assault. The exchange is accused of diverting cyberattack ransoms, according to US authorities. This was the first substantial charge against a crypto exchange.
The Treasury says Ransomware assaults cost over $400 million in 2020, four times the past year. In such operations, hackers routinely disable major apps in exchange for cryptocurrency. Suex allegedly “aided deals involving criminal gains out of at least eight Ransomware attacks,” the department said. It further alleged that over 40% of the exchange’s previous transactions involved “fraudulent characters.”
The latest sanctions complicate Suex’s business ties with US firms. Most commonly, US residents are barred from transacting with blacklisted firms. The Treasury warns that doing business with such a company could result in fines. US senators proposed a new clause after massive cyberattacks the year before. It protects federal employees and vital infrastructure corporations from legal action by disclosing cyberattacks.