Anonymity Key to $6B Money Laundering Scheme

31 May 2013 Internet, IT & e-Discovery Blog Blog
Authors: Peter Vogel

Headlines about the $6 Billion money laundering did not make clear that the salient fact that “the coin of its realm was anonymity, and it became a popular hub for fraudsters, hackers and traffickers.” The magnitude of Liberty Reserve’s money laundering is not just $6B but as the US Department of Justice (DOJ) declared in a news conference:

Over seven years, Liberty Reserve was responsible for laundering billions of dollars, conducting 55 million transactions that involved millions of customers around the world, including about 200,000 in the United States.

To put things in the proper perspective the DOJ opined that if “Al Capone were alive today, this is how he would be hiding his money.”

The New York Times reported that the federal indictment stated that accounts “...could therefore be opened easily using fictitious or anonymous identities:”

To transfer money using Liberty Reserve, a user needed only to provide a name, address and date of birth. But users were not required to validate their identity.

The larger question is why did it take the US government so long to figure this money laundering scheme? And of course next question is ...what other similar money laundering are operating at this moment that the US government cannot figure out?
 

 

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