US exposes multi-billion dollar scheme that helped Russian elite enrich
[:en]US Uncovers Billion-Dollar Scheme Enriching Russian Elite[:]
Illegal financial network helped Russian elite circumvent restrictions with digital assets
The United States of America has imposed new sanctions aimed at dismantling an illegal financial network that helped the Russian elite circumvent restrictions with digital assets. This was reported by Reuters.
The new measures target five individuals and four legal entities associated with an international network called TGR Group. It has facilitated significant sanctions circumvention. The list also includes a company registered in Wyoming, partially owned by a person already subject to sanctions.
According to Bradley Smith, Acting Under Secretary for Counterterrorism and Financial Intelligence, TGR Group used digital assets, including dollar-backed stablecoins, to circumvent U.S. and international sanctions. This allowed the Russian elite to enrich themselves and support the Kremlin’s financial interests.
The activities of this network include:
- laundering funds related to sanctioned organizations;
- exchange of cash for cryptocurrency without registration;
- providing cash to customers in the form of crypto assets;
- issuance of prepaid credit cards to circumvent control;
- concealing the source of funds for the purchase of real estate in the UK by wealthy Russian citizens.
The United States worked together with the United Kingdom to expose the network. The NCA website does not specify the total amount of money laundered, but the mention of a 3% commission hints at the scale. It is indicated that to compensate for the 20 million pounds seized by British law enforcement, the networks would have to launder about 700 million pounds “for free.” This means that the real amount of money laundering was in the billions of pounds. The organizers used these funds to support drug trafficking, cybercrime and espionage. The British added that 84 people were arrested, millions of pounds were confiscated and assets were withdrawn through cryptocurrencies and traditional financial institutions.
In four months, the network conducted cash collection operations at 55 locations in the UK, Scotland, and the Channel Islands. The main tool used to legalize the funds was the Tether cryptocurrency, a popular stablecoin that ensures anonymity and speed of transactions.
Couriers collected cash from drug cartels or fraudsters. The money was converted into Tether cryptocurrency. The “laundered” funds were sent to customers in different countries.
One of the companies, Smart, headed by Kateryna Zhdanova, helped clients bypass KYC (identity verification) procedures. For example, Russian clients used this scheme to purchase real estate in the UK worth £2 million. In addition, the Smart and TGR crypto wallets were linked to the Russian platform Garantex, which was blocked in 2022 for financing the supply of weapons for the war against Ukraine.
The US sanctions prohibit US individuals and legal entities from conducting any transactions with the listed entities. All assets of these persons under US jurisdiction are also frozen.
