- Proceeds from drug sales were transferred to Mexico via stablecoins
- Cartels deposited funds from drug trafficking in Binance accounts
US federal officials confiscated around $1.8 million in cryptocurrencies from six accounts held with the world’s biggest exchange, which were found to be linked to drug traffickers, CoinDesk reported.
Drug sales proceeds funneled via stablecoins
A US court in the Eastern District of Michigan’s Southern Division granted a request for forfeiture in the approximate amount of $1.8 million in current crypto value. The funds were seized in a police operation connected to a cash pipeline in May 2022.
The operation involved transferring the proceeds of drug sales to Mexico via stablecoins.
The scheme: details
According to insiders and court filings, cash couriers used Binance to buy Bitcoin and Tether (USDT). They deposited funds generated from drug trafficking in Binance accounts, then sent them to a designated address that a criminal organization ran in Mexico.
The criminal complaint named six Binance accounts.
“Tight” relationship with the DEA
An insider who cooperates with law enforcement on such crimes told CoinDesk the DEA and Binance had a “pretty tight” relationship. Binance employees and DEA officials convene to share intelligence on a regular basis. The information is used to facilitate DEA operations and help Binance adjust and update its anti-money laundering policies.
Not a first for Mexican gangs
Mexican gangs and drug cartels have been using Binance to launder money for at least two years. Carlos Echavarria, a Mexican national, was found guilty of drug trafficking and money laundering in 2021. He admitted to laundering crypto equivalent to around $4.7 million.
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