Search

Dutch authorities arrest man for using US-approved Tornado Cash to "facilitate money laundering"

A 29-year-old man was detained by Dutch police in Amsterdam for being the "suspected developer" of Tornado Cash, a US-approved cryptocurrency mixing service.

The man was suspected of "concealing criminal financial flows" and "facilitating money laundering" through the blending of cryptocurrencies through Tornado Cash, according to a statement from the Fiscal Information and Investigation Service (FIOD).


The man is scheduled to appear before a judge later today, and the FIOD has warned that additional arrests are not out of the question.


The FIOD has also stated that the body is paying "extra attention" to cutting-edge technologies like Tornado Cash mixers that "may facilitate money laundering."


According to the FIOD, online crypto mixers allow for the concealment of the origin or destination of cryptocurrencies, while the potential criminal origin of the cryptocurrency is "often not or hardly checked."

A criminal investigation into Tornado Cash was opened by the Financial Advanced Cyber Team (FACT) of the FIOD in June 2022 as a result of allegations that the platform had been used to hide "large-scale criminal money flows," including those resulting from cryptocurrency hacks and scams.


According to FACT, since its launch in 2019, Tornado Cash has generated at least $7BN (€6.85M) in revenue, with investigations revealing that at least $1BN (€970M) of those funds have an illegitimate source.


The Office of Foreign Assets Control (OFAC) of the US Treasury Department announced earlier this week that it would impose sanctions on the virtual currency mixer Tornado Cash.


According to a statement from OFAC, Tornado Cash uses the Ethereum blockchain to "indiscriminately" enable "anonymous transactions by obscuring their origin, destination, and counterparties with no attempt to ascertain their origin."


Despite being designed to "increase privacy," mixers like Tornado are "commonly used" by criminals to launder money, according to OFAC.

By fLEXI tEAM

13 views0 comments