New Regulatory measure to be taken for Bitcoin
The International Drug Control Board (INCB) says drug cartels in Mexico and Colombia are increasingly using cryptocurrencies like Bitcoin to launder money.
An estimate says that $25 billion (roughly Rs. 184690 crore) were used for money laundering through Mexican Cartels alone, and the board described those money launders as the most powerful and the richest organized criminal groups in the world.
“The use of bitcoin for money laundering is on the rise, especially among drug cartels like Jalisco New Generation Cartel and Sinaloa Cartel,” the officials said.
According to the report, the criminals are using methods to circumvent Mexican laws that require crypto platforms to notify authorities of any transactions over $2,830 (about rupees 216,200).
The officials said that “To stay below the threshold of high banking transactions, criminals often divide their illicit money into small sums and deposit them in different bank accounts”. They then, use these accounts to continuously buy small amounts of Bitcoin online to pay associates.
The report adds: “Mexican and Colombian organized crime groups are increasingly using virtual currencies due to the opacity and speed of transactions,” according to the US Drug Enforcement Administration.
An alert is raised in countries to reach an agreement and examine how to better regulate this payment system of cryptocurrency,” by the International Drug Control Board’s representative Raul Martin Del Campo told AFP, Mexico City.
“Countries can improve and update their laws and add to more transparency of transactions,” he added.
“There seems to be no land for the man. Because it’s on the internet, sometimes government bodies think they can’t regulate anything,” he said.
The report expressed concern about illicit financial flows that cost African countries $88.6 billion (approximately Rs 676,731) annually or about 3.7% of the Gross Domestic Product (GDP) of these countries.
“The (FDI) foreign direct aid and investment flow through Illegal and corrupt finance. It is also a to threat to the development of the continent,” he warned.