US Authorities Take Strict Action Against Crypto ATMs Involved in Human Trafficking
February 27, 2022A recent report published by the United States Government Accountability GAO revealed shocking news about the cryptocurrency ATMs. In 2021, a rapid increase in the installment of such cryptocurrency ATMs was reported throughout the globe. However, the GAO report implies that these ATMs have been engaged in supporting human and drug trafficking operations.
GAO officials also called for more stringent legislative regulations for these ATM operators. GAO is a government agency that provides accounting and investigative backup for the congress of the United States. The report by GAO added that the FBI investigation projected an increase in the use of these cryptocurrency kiosks for illicit purposes.
Due to the lack of regulatory clarity, several threat actors have started to use cryptocurrency ATMs for illegal activity. It is worth mentioning that in comparison to the crypto exchange platforms, these ATMs have smaller legal obligations. As pointed out by GAO, the law enforcement agencies are blocked from getting full disclosure due to legal restrictions.
The owners of crypto ATMs need to make a registration with the FinCEN or Financial Crimes Enforcement Network. However, the law does not require them to reveal the location of their crypto kiosks. The GAO officials are calling for a renewal of more austere and specified regulations for these ATMs that will aid federal agencies in identifying and preventing potentially illegal transactions.
FinCEN and IRS has Joined Hands to Crack Down Against Illicit Smugglers
The latest report from GAO called upon FinCEN and Internal Revenue Service IRS to join hands and put together a foolproof registration and legal audit procedure for these crypto ATMs. The GAO report also finds out a connection between 50% of the 40 large-scale sex trafficking markets with crypto ATMs for enabling crypto payments.
Furthermore, 36% of the drug trafficking cases pending at the US Immigration and Customs Enforcement Investigation have also found some connection with the crypto ATMs. The same is the case with 85% of fraud cases in the US Postal Service investigations and also 25% of the crypto scam cases processed at the IRS.
