The Civil Guard has arrested 35 people and is investigating 22 more in Spain for defrauding credit card users and laundering money through bitcoin.

According to the Commandary of Alicante, the accused siphoned off €600,000 (about $676.2 million) in a total of 1,020 crimes related to telematic scams. The organization obtained its victims’ credit card information while impersonating genuine individuals and companies online. They also used ‘skimming,’ a technique of stealing payment cards’ details by cloning their magnetic strips during swipes, and ‘bin attack’ — generating new card numbers using the original one — to scam 210 people of their money.

Bitcoin Used in Laundering $1.12 Million

The Spanish agency found that the organization hedged their profits into bitcoin, the world’s largest cryptocurrency, in hopes to transact them outside the purview of governments and regulated financial systems. The criminal group reportedly comprised nationals of Guinea, Spain, Nigeria, Cameroon, and Morocco, which made bitcoin a reasonable alternative to send money offshore. In the end, they laundered more than €1 million (about $1.12 million) through bitcoin.

The Civil Guard did not clarify whether or not they seized the laundered profits. It nevertheless found that the group sent money to the United States, Equatorial Guinea, and Benin through cryptocurrency-enabled money transfer platforms.

Police organizations including Interpol, Europol, the Provincial Prosecutor’s Office of Telematic Crimes, the General Prosecutor’s Office of Cyber Crime lent a hand to investigate the case further. As of now, the Commandery of Alicante has taken charge to oversee the operations.

Trouble for Cryptocurrency?

The arrests in Spain followed a long history of similar crackdowns across the world that found criminals using bitcoin as a tool to launder money. Since 2009, estimates suggest that online swindlers have cleaned roughly about $2.5 billion worth of dirty money using shady, underground cryptocurrency exchanges.


Researchers at CipherTrace Cryptocurrency Intelligence noted an increase in the number of online crimes, including mass cyber extortions, SIM swapping, and advanced cyber attacks. The firm said criminals need to quickly launder their steals in bitcoin before stronger anti-money laundering laws get deployed.

On June 21, the Financial Action Task Force (FATF) expects to publish guidelineson how about 200 participating nations could exercise oversight on the bitcoin sector, according to spokesperson Alexandra Wijmenga-Daniel. The draft would likely focus on creating an intragovernmental information-sharing network to capture bitcoin criminals and regulate cryptocurrency exchanges, custody services, and hedge funds.

The post Bitcoin Assisted Criminals in Laundering More than $1.12 Million appeared first on CoinStats Blog.

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