Crypto Laundering and Fraud: US Treasury Targets KNA and Huione Group, Report
- The US Treasury sanctions the Karen National Army for involvement in large-scale crypto fraud, including pig butchering scams.
- The Huione Group, linked to KNA, is flagged for money laundering and associated with North Koreas Lazarus Group.
- Huiones USDH stablecoin raises regulatory concerns as it resists law enforcement, enabling illicit activities.
The U.S. Treasury Department has put the Karen National Army, a Burma Militia group, on its list of the sanctioned entities due to alleged involvement in large-scale crypto fraud. The announcement made on May 5 by Treasurys Office of Foreign Assets Control also outlined that KNA was playing a crucial role in a large group of complex cyber frauds, such as the infamous pig butchering scams. The sanctions come as part of the campaign to fight cybercrime and related activities in the context of cryptocurrencies.
Dating apps and social media are the common platforms that fraudsters use to lure their victims in pig butchering scams. Targeted individuals often build time-consuming and close relationships with their targets to gain the latters confidence. After gaining the trust of their target, the scammers convince the victims to invest in various fake cryptocurrency projects. In this case, this traps the victims into putting more money to these scams since they had relied on the scammer. Such a scam ends when the fraudsters leave, leaving all the money with them.
Huione Groups Criminal Ties
The Huione Group is also listed into the USA PATRIOT Act as a primary money laundering concern. Some of them are Huione Pay, Huione Crypto, and a recently Telegram-based group for buying and selling stolen credit card data calls as Haowang Guarantee. Huione has also been associated with North Koreas Lazarus Group, a hacking team mainly involved in hack and cyber theft as well as crypto crime.
The final stages of setting up the chain involves Huione which is said to have facilitated the movement of more than $4 billion of illicit funds between 2021 and 2025 hence underpinning the role of the group in financial crime.
Cryptos Role in Money Laundering
Another type of violation that the Huione Group has been involved in is engaging in misconduct through issuing stablecoin, the USDH, which alarms the regulators. The media has it that the stablecoin is created to stand no chance of being frozen or blocked by law enforcement agencies in a way that would make it hard for them to end staking operations. Specifically, the Financial Crimes Enforcement Network (FinCEN) has listed USDH as suspect for possible use in money laundering and related crimes.
The sanctions against KNA and Huione are, therefore, part of the continuous crackdown by the U.S. government on illicit activities within the cryptocurrency market. While cryptocurrencies continue to gain increased adoption the authorities have continued to exercise increased control and scrutiny over them so as to enhance their transparency and check misuse for vice related activities. These actions highlight the need to protect the digital economy from malicious individuals who want to benefit from its existence in criminal ways.
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Read more: https://www.tronweekly.com/crypto-laundering-and-fraud-us-treasury-target/
Text source: TronWeekly
