Today’s post will address the realities and implications of INTERPOL’s dealings with criminal cases involving cryptocurrency.
Cryptocurrency, although not new to modern culture, is still relatively new to the world of INTERPOL. Crypto has been popular for over a decade, having been invented in 2009 and named the year’s best investment by Forbes in 2013, but it has really only become relevant to INTERPOL only in the last several years.
While INTERPOL is an international law enforcement organization that assists in apprehending suspects of many types of crimes, it became involved in criminal cases with a crypto component when cryptocurrency activity formed the basis for cases of fraud, money laundering, and other financial crimes. This has only been in the last few years, given that any criminal enterprise needs time to form and operate.
Businesses and investments related to cryptocurrency have created financial activity the likes of which have not been seen in our publicly traded markets, ever. While cryptocurrency is no longer new, cases related to cryptocurrency in the world’s judicial systems-particularly criminal courts- are fairly new. They often involve allegations of fraud and other financial crimes that fall under the umbrella of money laundering.
“We are facing an epidemic in the growth of financial fraud, leading to individuals, often vulnerable people, and companies being defrauded on a massive and global scale. Changes in technology and the rapid increase in the scale and volume of organized crime has driven the creation of a range of new ways to defraud innocent people, businesses, and even governments. With the development of AI and Cryptocurrencies, the situation is only going to get worse without urgent action.” INTERPOL Secretary-General Jürgen Stock stated.
As stated in a previous RNLJ post, what is different about the criminal charges we are seeing in cases involving cryptocurrency is that jurisdictions don’t always know how -or have not yet agreed on a common scheme- to regulate the financial transactions related to cryptocurrency. Accordingly, a person may be wanted for and detained for a Red Notice based on charges in one country, even if it eventually will not be honored by INTERPOL’s other member countries due to differing regulatory and criminal statutory standards. South Korea, for example, has a regulatory scheme that is still evolving and faces very specific concerns stemming from the Kimchee effect and related capital flight from the country. China has its own version of regulation (including a full ban on cryptocurrency and upcoming anti-money laundering reforms) that differes greatly from that of other countries still forming their cryptocurrency regulations, such as the United States.
Our next post will discuss specific instances of cryptocurrency cases that have involved INTERPOL.
As always, thoughts and comments are welcomed.