Investigation found that European banks contributed to major crypto-fiat deals. The Financial Crime Investigation Service (FCIS) conducted an investigation covering over 80,000 euro transactions, which revealed the participation of some of the largest European financial institutions in cryptocurrency transactions over the past two years. We are talking about transactions, the total amount of which exceeds € 661 million.
Since 2017, about 500 individuals and 100 legal entities using 7 European banks have conducted operations with cryptocurrency. Many of the participants in these transactions are citizens of Lithuania and Sweden, and the largest exchange transactions for 27.2, 16.6 and 14.1 million are, including Lithuanian taxpayers.
Such major organizations as Swedbank, SEB, Danske Bank, Citigroup, Credit Suisse, Luminor, Deutsche Bank, Citadele and some others were mentioned in the report. The information surfaced after the publication of the money laundering investigation reports, which involved the largest European banks and financial companies.
The Financial Crime Investigation Service uses data from the central bank of Lithuania, Lietuvos Bankas and other institutions. Information about enterprises and traders, who participated in exchange transactions using cryptocurrency that also involved fiat currencies, including EUR and USD, is analyzed. It also analyzes the rules for the circulation of electronic money in Lithuania.
Suspicion of money laundering
FCIS Director Mindaugas Petrauskas said that the initial origin of the capital involved in these transactions was not confirmed, despite the low tax rate of 5% on income from cryptocurrency in Lithuania. Speculators declare that some participants in the deals talk about huge profits, which is not surprising at such a significant turnover of transactions. One of them is a resident of Lithuania, who declared a profit of 6 million euros. Not a small part of these turnovers accounted for the income from the cryptocurrency trade, as well as the income earned by the ICO (initial coin offering).
The Estonian Ministry of Finance is already proposing to develop a number of bills that would regulate the conducting of an ICO and the process of attracting finance. In 2017, about 82 million euros were invested in ICO projects in Lithuania, which is not a small amount of money, whereas in 2018 it is expected that this amount will reach 500 million. Naturally, the regulatory authorities could not help but worry.
With this state of affairs in cryptospace, according to Petrauskas, there is a high risk of money laundering from illegal proceeds of criminal origin. The anonymity of participants in transactions and the absence of central subordination of any state jurisdiction make operations with cryptocurrency assets a convenient tool for laundering “dirty” money.
Those properties is perceived by the crypto community as the advantages and positive aspects of cryptocurrency, Petrauskas called them as a matter of concern, which in general is not surprising, because the organization he heads has the function of confronting any anonymity and disclosing personal financial information in order to influence on participants in financial transactions and financial flows.