Sydney woman charged for running alleged unlawful digital currency exchange

Detectives from the NSW Cybercrime Squad have charged a woman allegedly acting as an unlawful digital currency provider after seizing $60,000 in cash and over $73,000 worth of Bitcoin.

A 52-year-old woman was arrested at a Burwood shopping centre at around 1pm yesterday following inquiries from the squad’s Strike Force Kerriwah, which was established in late 2018 to investigate an online money laundering syndicate operating in NSW.

The investigation was also supported by AUSTRAC (Australian Transaction Reports and Analysis Centre) and the Australian Criminal Intelligence Commission (ACIC).

A search of the woman’s handbag and vehicle resulted in $60,000 in cash, 3.8 Bitcoin valued at more than $55,0000 and a mobile phone being seized.

NSW Police confirmed to iTnews the cryptocurrency was found on hard wallet and storage devices.

Strike force investigators also seized digital currency wallets and a further $18,200 in Bitcoin along with mobile phones, computers, digital storage devices and documentation while searching a residential unit in Hurstville shortly after the woman’s arrest.

The woman was taken to Burwood police station and charged with three counts of knowingly deal with proceeds of crime and breach requirement re digital currency exchange services.

It will also be alleged that the woman has transacted Bitcoin valued at more than $5 million since 2017.

Police will allege in court that the woman operated an unlawful online money laundering syndicate exchanging cash for cryptocurrency, which Cybercrime Squad Commander, Detective Superintendent Matt Craft said is the first arrest by the squad relating to non-compliant digital currency providers in the state, and potentially the first of its kind in Australia.

Craft stressed that the vast majority of digital currency exchange providers are doing the right things, but that this arrest also serves as a reminder to operators that they meet their legal obligations.

“While cash is still ‘king’, digital currencies are fast becoming the preferred choice for organised criminal networks involved in money laundering, funding terrorism, and cybercrimes.

“It is concerning that when this kind of online exchange goes unregulated, it can allow criminals to move currency and launder funds seemingly undetected.

“Let this arrest be a warning to digital currency exchange providers – if you fail to comply with your obligations, your actions will not go unnoticed.

“Any information about illicit activity by digital currency exchange providers that is provided to Cybercrime Squad detectives will be actively pursued in partnership with AUSTRAC and ACIC,” Det Supt Craft said.

The woman was granted strict conditional bail to appear at Burwood Local Court on Monday 20 July 2020.

Amendments to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 were introduced in April 2018 which included expanding the scope of the Act to include regulation of digital currency exchange providers.

AUSTRAC has cancelled associated digital currency exchange registrations as a result of investigations under Strike Force Kerriwah and will continue conducting assessments as inquiries by the Cybercrime Squad continue.