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This bitcoin account is collecting criminal funds

BIScom Subsection: 
Author: 
World Money Laundering Report

This morning, I received, in one of my corporate mailboxes, a spam which is disturbing on several levels, none of which are relevant to the core arguments in this piece so I've added the text in a footnote for readers' information.

What is relevant, and not disturbing, is that it demands payment to a specific bitcoin account.

This is it: 1JXuMq6sbL95XnrcDEsrZTCvvRjB52RCAD.

Governments and others are focussed on the person behind the account. There is another way, says Nigel Morris-Cotterill

In counter-money laundering circles, there's a case that has attained almost mythical status, largely because all the experienced people know about it but hardly anyone can find the original case report.

It's USA v Red Corvette. And no, we don't have the reference either and we have looked long and hard. The reason that the case is so important is that it's an early example of a government taking action in rem instead of in personam. That means it took action against the thing not against the person. In courts around the world, action can be taken against an unknown person (they are actually titled "v person or persons unknown" although in the USA a legal fiction is employed and the name John Doe is used).

There has long been a legal difficulty in relation to money held on deposit in banks: it is not money, per se, it's a legal obligation, in this case a debt i.e. the bank owes a debt to the depositor. Legal obligations have, for centuries, been distinguished in law from "things" and they have a special name: "chose in action." The plural is "choses in action." In the UK, in the 1990s, this distinction came to a head when a court found that, as a matter of law, it could not say that money transferred electronically in the course of a crime, had been "stolen." That was because only "things" could be stolen and the transfer of data amounted to a transfer of debt which was a chose in action. The specific difficulty was that because a chose in action was not a "thing" it was not, within the definitions relating to theft and other offences of dishonesty, "property" and those laws almost universally related exclusively to property.

Subsequently, in the UK and elsewhere, the status of records of money owed was changed so that electronically recorded funds (says he, trying hard to avoid using the word "money" in this context) was regarded, for all practical and legal purposes, as "a thing" and therefore it became "property" and the unauthorised transfer of data relating to those funds could be regarded as theft, etc.

In consequence, that means that any "money," the deposit, harbouring and payment out of which is recorded electronically, is "property" and (can you see where we are going with this?) if it's property then it's a thing and if it's a thing an in rem action can be made against it.

That means that there is no need to identify the owner of the account: it is enough to identify the account itself. In short, the account, in this case the bitcoin wallet, becomes the thing.

That leaves us with one outstanding question: who has the locus standi (the legal standing) to bring an action against the thing?

That, do a degree, will depend on local law and, in particular, the willingness of a government body and/or a court to make specific orders.

What is needed is a simple process by which those who are targeted for criminal conduct can simply send a copy of the demand to the relevant authority which, in some countries, has the authority to immediately freeze the wallet pending investigation. That power exists in many FIUs but it is, often, restricted to freeze the account in the hands of the person making the report i.e. the bank, etc which is obliged to file suspicious activity reports. Here there is a complexity: the recipient of the demand does not have any control over the wallet and cannot freeze it.

But exchanges, through which transactions are cleared, do have that ability if they act in concert (i.e. together).

And so, here's what is actually needed. A centralised database of accounts into which criminal funds are demanded to be paid, owned and operated by cryptocurrency exchanges which freeze accounts and make reports to the financial intelligence unit in their own countries. The FIUs should, through the medium of the Egmont Group maintain and distribute to its members a list of accounts that are named. FIUs should immediately distribute that list to exchanges with a requirement that the account be blocked pending investigation. Most cases will be black and white and investigation of those can take literally seconds, resulting in the account being blocked.

The next question would be what should happen to any funds in those accounts. As the deposits arising from the crime will be determined by their amounts and their singularity, they should be refunded to the payer. Any balance should be paid in a manner that governments determine (one view is that these balances, because of their nature, should not accrue to any individual government and that they should be made available as free money for very narrow humanitarian purposes e.g. WHO vaccination schemes against e.g. measles or mosquito borne diseases).

The fact is this: it's not legally difficult, it just takes a bit of logical thinking and a refusal to accept that "new" necessarily translates into "different."

The tools are already there: very little political will is required to deploy them.

--------- The Blackmail Spam Scam --------------------

Subject: MAS: [address redacted] 08/04/2018 06:18:37 Now we are really close

Tiсket Dеtаils: MAS-228-76667
Email: [address redacted]
Camera ready,Notification: 08/04/2018 06:18:37
Status: Waiting for Reply 36xuDaRy3A4f92wOnRmVkK1QrE2Ty63Qu9_Priority: Normal

--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*--*

hi.

If you were more attentive while caress yourself, I wouldn't worry you. I don't think that playing with yourself is really bad, but when all your friends, relatives, сolleagues receive video record of it- it is definitely for you.

I placed malisious soft on a porn site which was visited by you. When the victim press on a play button, device starts recording the screen and all cameras on your device begins working.

Moreover, soft makes a rdp supplied with key logger function from your system , so I was able to get all contacts from your e-mail, messengers and other social networks. I'm writing on this e-mail cuz It's your corporate address, so you will check it.

I suppose that three hundred usd is pretty enough for this little misstep. I made a split screen vid(records from screen (u have interesting tastes ) and camera ooooooh... its awful AF)

So its ur choice, if u want me to destroy ur disgrace use my bitcoin wallеt addrеss- 1JXuMq6sbL95XnrcDEsrZTCvvRjB52RCAD
You have one day after opening my message, I put the special tracking pixel in it, so when you will open it I will know.If ya want me to share proofs with ya, reply on this letter and I will send my creation to five contacts that I've got from ur device.

P.S.. U are able to complain to cops, but I don't think that they can help, the investigation will last for 5 month- I'm from Ukraine - so I dgf LOL

From: Abby Lady (order@noisetap.com)
Return:
Comment and caveat: the domain noisetap.com was registered in 2006. It is highly unlikely that the owners of that domain are the originators of this crime. However, the e-mail header suggests that the mail originated on their servers: "Received: from noisetap.com ([167.99.84.69])"

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For the avoidance of doubt: I have not visited porn sites and I don't have a camera on my PC. Even if I had, there is no way of relating that to my e-mail account unless I had registered, which, of course, I have not. What does trouble me is this: the heading "MAS" is the same set of initials as applies to the Monetary Authority of Singapore and Malaysia Airlines, both of which I do have regular dealings with and where my registered address is the address to which the blackmailer sent the mail. There are indications in that mail that show that the creator comes from an English (not American) speaking country. Obviously, there are no allegations relating to either "MAS," but there is, at least, something to put in the back of my mind in case something else comes along with a similar coincidence that might not be entirely coincidental.

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