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Tether, a major player in the cryptocurrency realm, is becoming the go-to tool for money launderers and fraudsters in Southeast Asia, according to a recent UN report. The report, released by the UN’s Office on Drugs and Crime, highlights the alarming rise of scams, particularly the infamous “pig butchering” tactic, involving false romantic connections.
Meanwhile, as the digital currency landscape evolves, criminal networks exploit Tether’s speed and irreversible transactions, creating a parallel banking system. Notably, the UN warns of a supercharged criminal ecosystem, emphasizing the urgent need for cryptocurrency regulations.
Tether (USDT) Becoming Popular Among Scammers
Tether, the world’s leading cryptocurrency platform, has found itself at the epicenter of a surge in illegal activities, particularly in Southeast Asia, according to a recent report by the UN’s Office on Drugs and Crime. This includes a disturbing trend known as “pig butchering,” a tactic where scammers engineer false romantic connections to exploit victims emotionally and financially.
Meanwhile, the UN report highlights a concerning surge in sophisticated, high-speed money laundering, particularly involving Tether. According to the latest Financial Times article, that cites the UN report, law enforcement and financial intelligence authorities are increasingly alarmed by this trend, signaling a growing need for robust measures to tackle financial crimes in the digital realm. Notably, the rise of cryptocurrency and technological advancements have facilitated organized crime’s age-old practice of using black market casinos to launder illicit funds.
In addition, the report underscores the prominence of online gambling platforms, especially illegal ones, as popular vehicles for cryptocurrency-based money laundering. Tether’s digital token, being a stablecoin pegged to the US dollar, facilitates quick and irreversible transactions on the blockchain.
Meanwhile, according to criminal prosecutor Erin West, Tether is the preferred mechanism for illicit activities due to its speed and irreversible transactions. He noted that the inability to retract transactions makes Tether an attractive tool for criminals, posing challenges for law enforcement in tracking and recovering illicit funds.
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Regulatory Lag Leads To Criminals’ Surge
Jeremy Douglas from the UN’s Office on Drugs and Crime underscores the inadequacy of cryptocurrency regulations. He stated that they lag significantly behind illicit activities related to cryptos or are virtually non-existent.
In addition, organized crime exploits these regulatory gaps, capitalizing on vulnerabilities and weaknesses within the system, posing a serious challenge for law enforcement, he noted. According to him, despite increased enforcement efforts globally, Tether remains a favorite among criminal groups for moving funds, even to the extent of certain casinos specializing in handling Tether transactions.
As Tether continues to face regulatory scrutiny and enforcement challenges, the UN report sheds light on the urgent need for robust cryptocurrency regulations. Meanwhile, the dark nexus between Tether and illegal activities in Southeast Asia underscores the evolving financial crime landscape, demanding swift and comprehensive regulatory responses to curb the proliferation of crypto-driven fraud.
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