Last Sunday’s New York Times article on Huione Group, which is accused of funneling billions of dollars through Cambodian banks, is a good example of the scale and sophistication of the money laundering organizations reportedly supporting transnational criminal organizations (TCOs). Whether in support of the global narcotics trade or other organized criminal activity, international money laundering organizations, which are capitalizing on a powerful combination of lax regulatory environments, ephemeral messaging and cryptocurrency to conduct their operations, have never been more effective.
At the same time, the Trump Administration’s Executive Order designating cartels as Foreign Terrorist Organizations, and the accompanying Bondi Memorandum on Total Elimination of Cartels and Transnational Criminal Organizations signals an intensified focus on disrupting cartel/TCO activity. Traditional banks need to be even more aware of heightened law enforcement scrutiny on customer and correspondent banking relationships that may be exposed to these extended networks, which maintain operations in market centers around the world. Global and regional banks alike will need to conduct targeted monitoring for account profile and transaction patterns that may be indicative of these new money laundering typologies.
Most notably, the Huione case illustrates that the use of cryptocurrency to facilitate illicit payments is quickly supplanting long-used Black Market Peso / Hawala informal value transfer methods and may become an area of tension between the Trump Administration’s crypto-friendly stance and its law enforcement priorities. Vehicles such as DeFi platforms, privacy coins, cross-chain bridges, and mixers are all being deployed by laundering organizations to obscure the proceeds of their criminal clients. While many of these methods are designed to avoid regulated third-party exchanges altogether, there is still substantial risk in the ‘off ramp’ process, when bad actors attempt to use mainstream exchanges to convert these holdings into more tangible value such as stablecoin and fiat currencies.
For responsible crypto exchanges, avoiding exposure to this money laundering wave will require every tool in the compliance toolbox: 1) enhanced "Know Your Customer" procedures and training to detect falsified and recycled (and increasingly AI-created) customer identification details, 2) enhanced account surveillance to detect signs of syndicate activity in geolocation, device identification and timing patterns, 3) next-gen cluster blockchain analytics to expand beyond individual flagged wallets to extended networks of high risk addresses, bridges and exchanges, and 4) robust use of open and human source intelligence to gather necessary facts and context related to high risk flagged accounts and transactions.
One channel, called “Demand and Supply,” had more than 400,000 users with hundreds of daily messages, including advertisements for money-laundering services.
https://www.nytimes.com/2025/03/23/world/asia/cambodia-money-laundering-huione.html
