Crypto-related money laundering reports rose 8% in Germany last year: FIU

Corresponding money laundering reports Cryptocurrency According to the annual report of the German Financial Information Unit (FIU), it rose 8.2% last year in Germany.

It reached 8,711 from 8,049 in 2023, reaching 8,711, accounting for 3.3% of all suspicious activity reports (SARs) submitted to the German head FIU for the fight against money laundering.

The total figure has increased by 23.6% since 2020. Bitcoin Dominate most of last year’s report, followed by Ethereum, XRP, Tether and litecoin.

According to FIU, credit institutions and banks have filed more than 6,000 crypto-related reports, typically referred to as trading platforms, mixed services and trading with gambling sites.

And for agency analysts, this lender advantage is a sign that “traditional financial players have long been a key observer of crypto-based risk.”

FIU interprets the growth of crypto-related AML reports as a sign that financial crime has rapidly adapted to new innovations and that cryptocurrencies have become an important part of the complex and international money laundering structure.

“The underlying mechanisms often eliminate traditional control systems and require a sophisticated analytical approach,” the report explains.

As an example, the report provides details of one money laundering case, including a network of individuals and channels, spanning most of 2024, revealing that the network’s main participants used 44 bank accounts and eight crypto trading accounts.

Given this complexity, FIU concludes the crypto-centric section of its report by asserting that “to deal with complex money laundering structures requires a coordinated approach by all involved parties,” and confirms that the rapid evolution of new washing methods requires the rapid development of new analyses and research techniques.

Financial crimes on the rise

For professionals working in the AML field, Germany’s record numbers stem from growth in cryptocurrency adoption around the world, as well as the growth in financial crimes in general.

“The rise in suspicious German crypto-related activity reports is driven by a combination of these two trends,” says Tobias Schweiger, CEO and co-founder of Hawk, a Munich-based anti-financial crime company. Decryption.

According to Schweiger, digital assets have proven increasingly attractive to potential moneylanders. Because it’s easy for them to hide the flow of money in their digital ledgers, and detection mechanisms struggle to keep up with the pace of change.

“Digital ledger technology remains relatively new and financial institutions are in the process of upgrading their money laundering anti-morning processes and tools to address this development,” he explains.

However, he suggests that EU MICA regulations will play an increasingly important role in this context, helping and demanding financial companies to ensure that KYC measures are sufficiently robust.

Also, as detection and reporting measures improve, Schweiger expects Germany and other countries to continue to see an increase in suspicious crypto-related activity reports “in the coming years,” in addition to an increase in reports, including Fiat currency transactions.

“Using detection tools with more AI will help financial institutions and regulators better identify illegal activities that may have previously been overlooked,” he says.

Ideally, Schweiger wants to see real-time analysis and the shift in relatives to “active risk mitigation” as he concludes.