- Mexican and Central American organized crime has discovered in the use of cryptocurrencies a way to evade the law.
- Intelligence and migration agencies are actively working to prevent digital money from being used in criminal activities.
- Ransoms of kidnapped people, organ trafficking and migrants are being paid for in crypto.
Various criminal groups that operate on the Mexican border with the United States are using cryptocurrencies in their human trafficking, extortion or kidnapping operations. This was forewarned by the director of the Financial Intelligence Unit (UIF) of Mexico, Santiago Nieto Castillo.
The official explains that Mexican and Central American gangs prefer ransom payments and transportation “services” to migrants from Honduras, El Salvador and Guatemala in cryptocurrencies because they are more difficult to track.
Castillo said that digital money is the new payment method demanded by the so-called “coyotes” of Central America and Mexico, dedicated to smuggling people to the United States. This is despite the fact that in Mexico the use of cryptocurrencies is not legal.
Registration of Illegal Payments in Cryptocurrencies
During the National Migration Conference (CNM) that took place on August 27th, the head of financial intelligence revealed that Mexican intelligence agencies have registered payments in cryptocurrencies for various criminal activities, including organ trafficking and human trafficking.
"We have had cases related to human trafficking, extortion, kidnapping, in which criminal groups end up obtaining cryptocurrencies to be able to introduce illicit resources to the financial system or send them from electronic platforms to other latitudes, such as Nigeria,"
said Nieto Castillo.
Cryptocurrencies have the advantage for criminals that, by not being traceable, they can evade the law and the mechanisms implemented by the authorities to prevent money laundering. In this way they can introduce the money to the Mexican financial system or send it abroad, he explained.
Mexican authorities confirmed that they are working on identifying the gangs and the financial routes used by the gangs in the Northern Triangle. In this sense, the FIU works in coordination with the National Institute of Migration (INM).
The FIU has so far received 1,904 reports of unusual transactions related to 1,674 people who could be involved in these crimes. The intelligence unit said that in 2016 it received a high number of reports as in 2020 and in 2021.
"On the issue of human trafficking, the amounts are much higher than the issue of smuggling of migrants,"
said Nieto Castillo.
"In fact, we find much greater complexity, for example, generation of companies, fronts or 'invoices' that are operating in human trafficking,"
On The Flipside
- As the use of cryptocurrencies in Mexico has increased, the FTC has also detected a greater number of scams. According to the official, scammers offer unsuspecting investors fabulous business “opportunities” in which the investor can double their money or gain greater financial freedom.
After the conference, the commissioner of the National Institute of Migration, Francisco Garduño, said that he had taken necessary precautions to support the FTC. He promised to “give preventive follow-up to this new form of organized crime that moves and expands its activities to other territories” and it is very profitable.
Why You Should Care?
Along with the growing adoption of cryptocurrencies in Mexico and Latin America, the activities of criminal mafias that use digital money are growing.
In one of the reports of illegal activities received, the amount of the operation was $151 million, the FIU said, without giving further details.