The Dutch Tax Intelligence and Investigation Service (FIOD) has arrested two men for allegedly laundering money with cryptocurrencies.
According to a statement released by the International Revenue Service on February 18, the two men were arrested on February 17 in connection with two separate criminal investigations into money laundering using cryptocurrencies. Both investigations were conducted by the National Office for Serious Fraud, Environmental Crime and Asset Forfeiture.
The money trail
One of the suspects was a 45-year-old man accused of laundering 2.1 million euros. He allegedly used large purchases with a cryptocurrency-backed credit card that Dutch tax authorities could not explain based on his income and assets.
He also reportedly withdrew 10,000 euros (nearly $10,800) in cash. Several of his belongings were seized, including three kilograms of gold, 260,000 euros in crypto debit and credit cards (over $280,000), a car, and luxury goods such as watches and jewelry.
The other suspect is accused of laundering 100,000 euros (nearly $108,000). He allegedly used cryptocurrency mixing service Bestmixer, but authorities were able to identify the IP address associated with his Bitcoin address.
As Cointelegraph reported in May 2019, authorities in the Netherlands and Luxembourg along with Europol have shut down one of the three biggest cryptocurrency tumblers.
Cryptocurrencies and money laundering
Financial regulators around the world have repeatedly suggested that there is a relationship between money laundering and cryptocurrencies. Recently, the Central Bank of Russia released a new set of suspicious transaction rules that broadly classify any cryptocurrency-related transaction as a potential money laundering risk.
To reduce the money laundering risks associated with cryptocurrencies, Swiss regulators recently adopted new rules that lower the threshold for unidentified crypto exchange transactions from 5,000 francs to 1,000 francs (about 1,020 $).