Raids led by Australian Federal Police across Melbourne has seen two Australian crypto exchanges shut down. The shutdown reports came about after a key executive instrumental in their running was arrested by the police. It, in turn, forced AUSTRAC to suspend the two exchanges.
According to Micky.com.au, the man arrested in Melbourne is a twenty-seven-year-old residing in the Bulleen Suburb.
Micky goes on to state:
He has been charged with trafficking, importing, and having close to 30kg of drugs. The drugs include banned substances such as ketamine, methamphetamine, cocaine, and MDMA.
The news reports indicate that the 27-year old played an essential role in controlling the operations of an Aussie based criminal syndicate. The syndicate is alleged to have made use of numerous Bitcoin accounts, darknet websites, and legitimate businesses.
All these were relied on by the syndicate to the source, pay, as well as distribute the banned substances in the country.
After the arrests, AUSTRAC was forced to act swiftly and suspend the operations of the two crypto firms in question.
In addition to suspending the two exchanges that the 27-year old was associated with, the AFP also restrained a number of properties.
The properties include cryptocurrency and cash worth more than AUS$ 2m, a motorbike, motor vehicles, real estate properties, and some bank accounts.
Dr. Nathan Newman, the AUSTRAC National Manager of Regulatory Operations, said:
AUSTRAC has a role in disrupting and deterring criminal exploitation of the country’s financial system. The organization is, therefore, mandated to take swift action whenever it suspects that there is a reasonable chance that the system may be compromised.
He added that:
The organization’s decision to suspend the operations of the two entities associated with the 27-year old means that the businesses will no longer be operational. The crypto exchanges will continue to remain closed until further notice.
At this point, the effect on the clients who were relying on the two exchanges is yet to be determined.
The recent raids are linked to another operation conducted two years ago. In the previous operation, two people were taken into custody in connection to drug trafficking.
The October 2017 raids saw the two being arrested for trafficking drugs internationally. The drugs were imported into Melbourne using international mail in a bid to evade police detection.
Crypto Exchanges Shutdown
AUSTRAC suspended the following cryptocurrency exchange providers: MK Buy & Sell and AUSCOIN ATM. The former trades as SK BTC.
Australia passed legislation in 2017 that handed AUSTRAC the authority and mandate to monitor all local exchanges dealing with cryptocurrency.
It now has the mandate to subject them to the same counter-terrorism and anti-money financing laws subjected to all institutions dealing with fiat currency, e.g., banks.
Paul Hopkins when commenting on the ongoing investigations stated that:
Investigations of this nature tend to be quite complex. The operational results achieved by the team investigating such criminal syndicates are a testament to the good work performed by the local police.
Do you think the shutdown of the two Aussie crypto exchanges will have any impact on the uptake of cryptocurrency in the country? Let us know in the comments section below!
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