New York Police Win FinCEN Award for Bitcoin Investigation (involves an unnamed DNM, Coinbase.com, blockchain analysis, and more)

https://www.coindesk.com/new-york-police-win-fincen-award-bitcoin-investigation/

New York Police Win FinCEN Award for Bitcoin Investigation Michael del Castillo (@DelRayMan) | Published on May 13, 2016 at 19:36 BST News

The New York State Police won formal recognition this week for its work tracing bank deposits back to a number of drug deals conducted in bitcoin on an online dark market.

The Financial Crimes Enforcement Network (FinCEN) presented an award to the New York State Police Suspicious Activity Review (SAR) Team and the New York State Police Financial Crimes Unit during an event held at the US Department of the Treasury in Washington, DC.

In a statement to announce the award and five others, outgoing FinCEN director Jennifer Shasky Calvery spoke to the increasing sophistication of financial crimes investigation by US officials.

Calvery said:

"Without the valuable information that US financial institutions provide, the significant cases recognized here today would likely never have seen the light of day."

In this particular case, while reviewing financial reports provided as part of the Bank Secrecy Act, the police department's SAR team discovered that over a six-month period, an unnamed individual made more than 20 un-sourced deposits totaling $170k, in amounts seemingly designed to evade detection.

An investigation by the department's Financial Crimes Unit discovered that an individual had deposited cash into several bank accounts, used the cash to purchase bitcoin, then closed the accounts shortly thereafter. Eventually, the investigation revealed the individual had moved more than $250k through two different financial institutions derived income claimed to have been generated while trading bitcoins.

In cooperation with multiple unnamed companies in the bitcoin space, investigators eventually traced the money back to an unidentified dark market, culminating with both an arrest and a seizure of narcotics. Similarities to Rochester arrest

Though the names of the institutions involved and the individual's name are not disclosed, the details closely resembles the case of [REDACTED] of [REDACTED], New York, who last year was reportedly found with 800 Xanax pills and $170 in cash.

According to the Syracuse Post-Standard, the alleged scheme employed the services of Bitstamp and Coinbase, with [REDACTED] allegedly using online blackmarket, Darknet, to sell illicit goods.

Albany law enforcement officials and FinCEN did not immediately respond to requests for further information about the investigation. According to FinCEN, the individual was successful prosecuted.

Once the currency of choice at the now-shuttered Silk Road dark market, which in 2012 generated a reported $22m revenue, bitcoin is now seen by some law enforcement elements as easier to trace than cash. Last month, Science Magazine published a lengthy report on why criminals should think twice about using the digital currency owing to its transparent nature.


Comments


[21 Points] funwithnopantson:

If only they investigated the perpetrators of the 2008 financial crisis with the same effort.


[21 Points] None:

$170 in cash

Nobody ever has THAT much money. He must have robbed a whole bank for an amount of that value.


[9 Points] CynicalElephant:

Me reading title: "oh shit, have our dnm days come to an end!"

totaling 170k

Welp, I should be fine with my $50.


[8 Points] TripAddict:

[deleted]


[7 Points] None:

which in 2012 generated a reported $22m revenue

Finally, an article that doesn't say the Silk Road was a billion dollar operation.


[3 Points] onemorebrick:

"over a six-month...made more than 20 unsourced deposits totaling $170k"


[3 Points] UncleRays:

Anyone think this has anything to do with Nuke? A user said a major bust happened and we would hear about it. this was maybe a month ago?


[1 Points] Vendor_BBMC:

When I saw this, I thought "Nucleus' owner". But it can't be.

Every bitcoin is still in Nucleus' wallets. https://www.walletexplorer.com/wallet/NucleusMarket

But I'm sure Nucleus' owner is still at liberty because a wallet I'm fairly sure is his own has started sending bitcoin to cash out at localbitcoins again https://www.walletexplorer.com/wallet/3c6ff0f47e7246e0

He cashed out 40 btc on Thursday 12 May. $864k has passed through that wallet in 2 months, I'm pretty sure it's not a big vendor https://blockchain.info/charts/received-per-day?timespan=60days&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=1Hxt8gUKqkJP2PhCXyWMVB1SGYbMGWyuAR

He made the last withdrawal from nucleus, I think it was offline at the time.

The fact that this guy isn't in prison shows that the cops can't be THAT great with bitcoin. This guy has taken nearly a million dollars out of Nucleus in two months, and doesn't even tumble them. Sure, there are thousands of tiny deposits from all sorts of sources to disguise it, but all those big spikes are nucleus bitcoin.


[1 Points] custyanon:

You get an award. You get an award. Everyone gets an award!!!


[1 Points] PolyHigh09:

I love how they held an event in DC and gave out stupid bull shit "awards" for blowing a bunch of tax payer dollars on junk like this...but go arrest 5 rapists and a few murders and you get a pat on the back...if that...this countries ass backwards.


[0 Points] Selectivescammer1:

So you would need a SAR against you for them to possibly investigate, did this guy use a mixer? i'd so no...170k in six months and six deposits is 28k, and if he had six bank accounts, deposits would have been 4.7k in each, which is under the currency reporting limits, but maybe it looked too much like structuring, or maybe opening and closing bank accounts, all within a small space of time also seemed suspicious...