Discovered that Mexican drug cartels are laundering money on the virtual currency exchange 'Binance'



Binance , the world's largest cryptocurrency exchange, is reportedly experiencing a surge in withdrawals due to growing distrust among users. Meanwhile, drug cartels based in Mexico are suspected of laundering billions of yen through Binance, and drug cartels are under investigation.

International drug conspiracy used Binance to launder millions, DEA probe finds - Business News
https://biz.crast.net/international-drug-conspiracy-used-binance-to-launder-millions-dea-probe-finds/

As a result of the investigation so far, Binance has revealed that important information such as financial information and home base is hidden, and distrust is increasing among users due to the opaque management situation.

Reuters analysis reveals that the world's largest virtual currency exchange ``Binance'' continues to operate opaquely and has hidden financial information and home base-GIGAZINE



Bitcoin and other cryptocurrencies on Binance have been touted by Mexico-based drug cartels as a way to hide their illicit commerce, previously deemed impossible to track by government agencies. However, the US Drug Enforcement Administration (DEA) is conducting an investigation, claiming that a Mexican drug cartel laundered $15 million (about 2 billion yen) to $40 million (about 5 billion yen) through Binance. increase.




Cooperation with virtual currency exchanges such as Binance is essential for the DEA to track criminal organizations. We are reporting that we are providing information to In early 2022, Binance worked with the DEA to freeze over 100 accounts suspected of laundering drug money in Mexico.

The authorities' investigation began in 2022 when multiple informants using the cryptocurrency trading platform localbitcoins.com were contacted by users who offered to exchange cryptocurrencies for cash. . The content of the transaction proposed was simple, sending Bitcoin or USD Coin to the seller's account, and then meeting face-to-face to receive the cash. Carlos von Echabarria, a Mexican national, said that the cash came from ``family restaurants and ranches''.

After that, a DEA undercover investigator investigated Echabarría and found that he was handling funds leading to drug trafficking, and Echabarría was arrested in 2021. Echabarría has pleaded guilty to drug trafficking and money laundering charges.

With the help of Binance, the DEA investigated Echabarría's virtual currency and discovered that Echabarría's funds were being withdrawn from one account. The discovery revealed that laundering was ongoing between Echavarría and the account owner. According to the investigation, the owner of this account will make 146 buy orders totaling about $46 million (about 5.5 billion yen) in 2021, and 117 sell orders worth about $38 million (about 5 billion yen). It is said that



The DEA explains that at least $ 16 million (about 2.1 billion yen) is from drug revenues on the origin of these funds.

Previous investigations have also found evidence that drug cartels were laundering money using virtual currencies, but the amount of transactions was around several hundred thousand yen. On the other hand, the case involving Echabarría revealed how he laundered a large amount of drug funds.

Matthew Price , a former US IRS cybercrime investigator who works for Binance at the time of writing, said of the case involving Echabarría, ``It's an example of how transparency in cryptocurrency transactions works against criminals.'' said.

On the other hand, cryptocurrency experts point out that drug cartels may try to avoid DEA investigations by laundering money across borders.

Since 2018, Binance has been underinvestigation by the US Department of Justice for suspected money laundering, tax evasion, and sanctions violations.

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