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South Korean officials conclude week-long raid in Terra-LUNA case

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South Korean officials conclude week-long raid in Terra-LUNA case

South Korean officials conclude week-long raid in Terra-LUNA case Monica Noronha · 3 seconds ago · 1 min read

The Ministry of Justice has issued a “notification upon arrival” notice to Do Kwon while Daniel Shin is restricted from leaving the country.

1 min read

Updated: July 28, 2022 at 5:52 pm

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Cover art/illustration via CryptoSlate

After more than a week, South Korean authorities concluded their raids on crypto companies in connection with the Terra case on July 27, Yonhap news reported.

The Seoul Southern District Prosecutors Office is investigating the collapse of TerraUSD (USTC) and allegations of fraud against Terraform Labs co-founders Do Kwon and Daniel Shin.

The prosecutors had initiated a search and seizure of seven local crypto exchanges and eight other locations including offices and residences of people involved in the case on June 20.

According to Yonhap, the raid lasted a week because of the immense amount of data requested by the authorities.

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In cases where data was insufficient, the authorities asked data analysts to extract more data, lengthening the search and seizure, Yonhap news reported.

The authorities will analyze the data collected from the raid to issue subpoenas for Kwon and Shin.

On July 27, Yonhap reported that the ministry of justice issued a “notification upon arrival” order to Kwon. This means that Kwon is required to inform South Korean officials whenever he returns to the country from Singapore. Prosecutors are also looking into extraditing Kwon by issuing a red notice to Interpol.

Furthermore, Shin, whose home and office were raided last week, is restricted from leaving the country.

Earlier this month, former Terra employees had said that they were banned from traveling abroad along with all persons involved in the case.

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India’s ED freezes $46 million of Vauld’s funds on money-laundering charges

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India’s ED freezes $46 million of Vauld’s funds on money-laundering charges

India’s ED freezes $46 million of Vauld’s funds on money-laundering charges Christian Nwobodo · 7 hours ago · 2 min read

Vauld’s entity in India failed to conduct due diligence on funds sent through the exchange and was uncompliant with India’s Enforcement Directorate.

2 min read

Updated: August 12, 2022 at 7:46 pm

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Singapore-based Crypto Lender Vauld is facing money laundering charges in India after $46.5 million (3.70 billion Indian rupees) was frozen from its local entity, Flipvolt Technology.

India’s Enforcement Directorate (ED) confirmed in an Aug. 12 statement that it is investigating Vauld (Flipvolt Technologies) and Yellow Tune Technologies for allegedly facilitating illegal transfers through the crypto exchange.

According to the regulator, 23 entities under probe by the ED had reportedly deposited 3.70 billion rupees into Yellow Tune’s crypto wallet, which was subsequently sent to foreign wallet addresses without following due process and raising suspicious transaction reports (STRs).

The statement confirmed:

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Yellow tune by using the assistance of Flipvolt Crypto-Exchange, which has very lax KYC norms, no EDD mechanism, no check on the source of funds of the depositor, no mechanism of raising STRs, etc., assisted the accused fintech companies in avoiding regular Banking channels, and managed to easily take out all the fraud money in the form of crypto assets.

The Indian Authority accused the exchange of showing laxity in handling the case.  It failed to provide the authority with KYC details of the wallets and could not account for crypto transactions made by Yellow Tune.

It has made no sincere efforts to trace these crypto assets. By encouraging obscurity and having lax AML norms, it has actively assisted M/s Yellow Tune in laundering the proceeds of crime worth Rs 370 Crore using the crypto route.

Consequently, the Indian exchange owned by Vauld will forfeit the laundered amount until it provides comprehensive details in defense of the charges against it.

Indian’s ED out against Money laundering

India’s Enforcement Directorate (ED) earlier launched an investigation into the activities and compliance of non-banking financial companies (NBCFs) to the Reserve Bank of India guidelines.

The investigation report showed that many defaulting fintech companies laundered their profits using crypto. The crypto exchanges implicated in the probe allegedly failed to conduct due diligence before helping the firms send the funds to foreign wallets.

According to India’s Economic Times, about 10 crypto exchanges are under probe by the ED for facilitating the laundering of more than 10 billion rupees ($130 million).

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Consequently, on Aug. 5, the ED raided Wazirx’s territory to freeze about $8 million belonging to the exchange. WazirX is said to have helped convert the Indian rupees to crypto and then sent the funds to foreign wallets through Binance.

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Curve Finance front end UI compromised in DNS hack – users advised not to interact

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Curve Finance front end UI compromised in DNS hack – users advised not to interact

Curve Finance front end UI compromised in DNS hack – users advised not to interact Liam ‘Akiba’ Wright · 1 hour ago · 1 min read

Over $500k has been stolen from Curve finance as the front end is compromised through an attack taking control of its nameserver.

1 min read

Updated: August 9, 2022 at 10:13 pm

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Samczsun, a researcher at Paradigm, is reporting that the Curve Finance front end has been compromised, with over $500k stolen within a matter of minutes.

🚨🚨🚨@CurveFinance frontend is compromised, do not use it until further notice!

— samczsun (@samczsun) August 9, 2022

The official Curve Finance Twitter has confirmed the news stating:

Don’t use the frontend yet. Investigating! https://t.co/8kmtpGsLQQ

— Curve Finance (@CurveFinance) August 9, 2022

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The founder of Rotkiapp, Lefteris Karapetsas, theorized that “It’s DNS spoofing. Cloned the site, made the DNS point to their ip where the cloned site is deployed and added approval requests to a malicious contract.” Curve retweeted the theory in apparent support before following up with a further announcement;

Don’t use https://t.co/vOeMYOTq0l site – nameserver is compromised. Investigation is ongoing: likely the NS itself has a problem

— Curve Finance (@CurveFinance) August 9, 2022

Posted In: Crime, DeFi, Hacks

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US vows to ‘aggressively pursue’ crypto mixers following Tornado Cash sanctions

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US vows to ‘aggressively pursue’ crypto mixers following Tornado Cash sanctions

US vows to ‘aggressively pursue’ crypto mixers following Tornado Cash sanctions Samuel Wan · 11 hours ago · 2 min read

U.S. Secretary of State Anthony Blinken said the government will continue clampdowns against crypto mixers that are laundering money for criminals.

2 min read

Updated: August 9, 2022 at 2:34 pm

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Cover art/illustration via CryptoSlate

U.S. Secretary of State Anthony Blinken warned that the administration would continue to “aggressively pursue” crypto mixers suspected of laundering illicit funds.

We’ll continue to aggressively pursue actions against currency mixers laundering virtual currency for criminals. Today, @USTreasury sanctioned virtual currency mixer Tornado Cash, which has been used to launder money for a U.S.-sanctioned DPRK state-sponsored cyber hacking group.

— Secretary Antony Blinken (@SecBlinken) August 8, 2022

The comments came as the U.S. Treasury enacted sanctions against Tornado Cash over allegations it had washed over $7 billion worth of cryptocurrencies since 2019. A press release stated that Tornado Cash had repeatedly failed to implement “effective controls” to stop money laundering by criminals.

As a whole, the crypto community responded negatively to the sanctions, with many voicing concerns over hypocrisy and governmental overreach – particularly as the platform is a neutral tool that runs autonomously.

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Vice Writer and self-described cyber historian Lorenzo Franceschi-Bicchierai summed up the argument by saying code is an expression of free speech and so cannot be illegal, let alone sanctioned.

With that, thoughts turn to Secretary Blinken’s statement and whether his words effectively spell the end for crypto mixers and personal freedoms in the U.S.

Is this the end of crypto mixers?

In justifying sanctions against Tornado Cash, the U.S. Treasury said the platform had repeatedly failed to implement controls to stop criminals from money laundering on the platform. However, crypto mixers do not operate Know Your Customer (KYC) controls by their inherent nature.

Tornado Cash co-founder Roman Semenov explained that the platform is decentralized and autonomous, meaning it operates without third-party control. To that end, it has no corporate office or staff, and the user interface is lifted from an Ethereum Name Service domain.

Nonetheless, the U.S. Treasury stated that crypto “mixers that assist criminals are a threat to U.S. national security.” And that it will continue monitoring mixer activity with a view to clamping down on illicit financial risks.

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“[The] Treasury will continue to investigate the use of mixers for illicit purposes and use its authorities to respond to illicit financing risks in the virtual currency ecosystem.”

The crypto community responds

Over five hundred replies were posted to Secretary Blinken’s tweet, the majority of which condemned the actions of the Treasury.

For example, one Twitter user called out the hypocrisy of sanctioning Tornado Cash when HSBC Bank paid a fine $1.9 billion fine on charges of money laundering. The incident happened approaching ten years ago. However, this does not detract from lawmakers treating banks favorably.

FatManTerra waded into the discussion by correcting Secretary Blinken on his designation of Lazarus and Tornado Cash as connected entities. He stated the hacking group had merely used the mixer platform.

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