tl;dr
A new report from the United Nations Office on Drugs and Crime (UNODC) highlights the increasing use of cryptocurrencies and generative AI by organized crime groups in Southeast Asia for fraud, money laundering, and online scams. The report estimates financial losses from these activities to range b...
A new report from the United Nations Office on Drugs and Crime (UNODC) reveals a troubling uptick in the use of cryptocurrencies and generative AI by organized crime groups in Southeast Asia for fraudulent activities and money laundering. It's estimated that financial losses from these nefarious endeavors could range between $18 billion and $37 billion in 2023.
The report highlights the exploitation of underregulated online gambling platforms and unauthorized virtual asset service providers by cybercriminals to launder their proceeds and integrate illicit money into the global financial system. Furthermore, the rise of Russian-language, non-KYC instant exchange services simplifies money laundering and sanction evasion, exacerbating the issue.
Additionally, the integration of generative AI into criminal activities is a cause for concern, as it enables the creation of deepfakes, enhancing criminals' ability to commit fraud and deceive victims. The report also indicates the involvement of organized crime groups in human trafficking, coercing individuals into participating in illegal activities like cyber fraud and money laundering.
UNODC Consultant Slava Demchuk, CEO of crypto compliance firm AMLBot, believes that blockchain analytics tools can aid in identifying the sources of crypto assets associated with risks, such as sanctions and illegal services. However, the evolving situation has outpaced governments' capacity to contain it, according to Masood Karimipour, UNODC Regional Representative for Southeast Asia and the Pacific.
The report underscores the need for increased regulatory measures to curb the exploitation of cryptocurrencies and generative AI by organized crime groups in the region, as well as tackling the multifaceted issue of human trafficking and coerced involvement in illegal activities.