The US Cracks Down on Cryptocurrency Exchanges Linked to Russian Cybercriminals
In a significant move, the US government has imposed sanctions on cryptocurrency exchanges that have been used by Russia-based cybercriminals to process illicit funds. The Office of Foreign Assets Control (OFAC) has targeted Cryptex, a crypto exchange based in St. Vincent and the Grenadines but operating in Russia, for its involvement in facilitating illegal financial transactions.
Additionally, OFAC has sanctioned Sergey Sergeevich Ivanov, a Russian citizen associated with the virtual currency exchanger PM2BTC. Ivanov has been identified as a key player in processing payments for various fraud shops, including one known as “UAPS.”
Furthermore, the Treasury’s Financial Crimes Enforcement Network (FinCEN) has labeled PM2BTC as a “primary money laundering concern” in connection with illicit financial activities originating from Russia.
As a result of these sanctions, all assets and property belonging to the sanctioned individuals and entities within the US or under the control of US persons are now blocked and must be reported to OFAC. Financial institutions and other entities engaging in transactions with these sanctioned parties could face legal repercussions.
US Authorities Offer Reward for Information on Ivanov
The US Department of State has announced a reward of up to $10 million for any information leading to the arrest and conviction of Sergey Sergeevich Ivanov. In a coordinated effort with Dutch law enforcement, US authorities have also seized web domains and infrastructure associated with PM2BTC, UAPS, and Cryptex.
Significant Cybercrime Funds Processed
The sanctioned entities and individuals have been implicated in processing hundreds of millions of dollars in funds derived from cybercriminal activities. Cryptex alone has received over $51.2 million from ransomware attacks and has facilitated transactions totaling over $720 million to services commonly used by Russia-based ransomware actors and cybercriminals.
Ivanov, on the other hand, has allegedly laundered hundreds of millions of dollars’ worth of virtual currency for various criminal actors over the past two decades. This includes serving as a payment processor for fraud shops, including the OFAC-designated Genesis Market.
Continued Efforts to Combat Russia-Based Cybercrime
This latest crackdown is part of a series of legal actions taken by the US to combat Russia-based cybercriminals. In July 2024, two Russian nationals were convicted for their involvement in the LockBit ransomware group, while in May, an indictment was unsealed against LockBit leader Dmitry Yuryevich Khoroshev following Operation Cronos, a joint effort by the US, UK, and Australian governments.
The US government remains committed to disrupting and dismantling cybercriminal networks that pose a threat to national security and global financial stability.