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A diverse group of U.S. law enforcement agencies formally announced their collaboration to combat darknet and digital currency crimes with the announcement on June 20 of the Darknet Marketplace and Digital Currency Task Force. The new organization will target “cryptocurrency-related crimes” such as drug trafficking, money laundering, identity theft, and child exploitation.
Last week, representatives from the Arizona Homeland Security Investigation (HSI), U.S. Attorneys, the Internal Revenue Service Criminal Investigation Service (IRS-CI), the Drug Enforcement Administration, and the Postal Inspection Service signed a memorandum of understanding.
Related: How the IRS seized $10 billion worth of cryptocurrencies using blockchain analytics
The agencies have been working together since 2017 and during this time have seen an increase in the use of cryptocurrencies. According to his statement:
“The mission of the Dark Web and Digital Currency Crime Task Force is to disrupt and eliminate criminal organizations that exploit the appearance of anonymity on the Dark Web or use digital currency to facilitate criminal activity.”
Law enforcement agencies around the world form specialized units for law enforcement related to cryptography. At the end of last year, Interpol created a unit for crimes related to cryptocurrency. Police in Canadian cities have begun to form local task forces. The new target group will have an international reach as HSI has 93 overseas offices in 56 countries.
Working with businesses and industries that manage the very financial systems terrorists and criminal organizations seek to exploit, Homeland Security Investigations seized nearly $4 BILLION in cryptocurrency from illicit activities last year. #fraud #police #AML #finance pic.twitter.com/VbGz3bj2ny
— Homeland Security Investigations (@HSI_HQ) June 16, 2023
In the United States, the Federal Bureau of Investigation formed a Virtual Asset Exploitation Unit in February to work with the Department of Justice’s National Anti-Cryptocurrency Squad. The Securities and Exchange Commission also almost doubled its cyber division last year.
Law enforcement agencies have work to do. Last year, Chainalysis estimated that over 4,000 crypto whales were holding ill-gotten funds, and the number of phishing attacks on cryptocurrencies has increased by 40% this year. However, there is also evidence that law enforcement efforts are bearing fruit.