In a report released yesterday on serious organized crime called “Exploring Tomorrow’s Organized Crime” (the “Report“), Europol found that organized crime is now becoming a virtual activity over the Internet and as a result, transnational criminal organizations (“TCO“) are migrating towards virtual payment methods to conduct commercial affairs, including digital payments. According to Europol, the move to digital finance eliminates face-to-face interactions (and reduces identity risks for organized criminals), allowing anonymous exchange of financial resources.
Key facts from the Report are as follows:
- Innovation will increasingly allow TCOs to commit crimes anonymously.
- Big data will be exploited by TCOs to extort people and businesses on an unprecedented scale, as well as to commit fraud using stolen personal information. The more people provide personal data to more and more organizations, the more they become exposed to criminality.
- The “rich are getting richer” problem, wealth disparity, in the EU is making people more readily accept TCO criminal activities that target the wealthy if the crimes deprive the rich of their wealth.
- TCOs continue to infiltrate natural resources all over the world as agents (wind farm projects, natural gas, solar energy, etc.). They continue to prefer the green energy sector and have successfully infiltrated those sectors.
- Digital currencies, such as Bitcoin, will facilitate money laundering and alleviate the need for criminal infrastructure. The anonymous nature of digital currencies and their rapid transferability make them ideal for money laundering, especially if used with illegal forms of online gambling.
- Digital currencies like Bitcoin have become the currency of choice for internet-facilitated crime.
- The proliferation of digital currencies will allow an entire criminal economy to flourish with little possibility of law enforcement intervention.
- With respect to terrorism, anonymous marketplaces on the Internet for goods and services that are illegal carry the risk of convergence of terrorism and organized crime.
- The return of terrorist defectors who are radicalized will join the TCO underworld and drive some of its activities.
- Part of the solution for law enforcement will have to be public-private partnerships to get on top of TCOs and their activities.