Cybercriminals are turning to cryptocurrencies like Monero to convert illegal revenue into clean cash, new research shows.
According to a new academic study into the macro economics of cybercrime and how cybercriminals launder and ‘cash out’ the profits of criminal endeavours by international cybersecurity firm Bromium, virtual currencies have become the primary tool used by cybercriminals for money laundering and constitute an estimated 8 to 10 percent of total illegal profits laundered globally, amounting to an estimated $80-$200 billion each year
Albeit we hear a lot of hype about cryptocurrencies like Bitcoin, Ethereum, Litecoin and the blockchain, cybercriminals are now moving away from these popular crytpos to less recognised virtual currencies, like Monero, that provide greater anonymity. The findings were announced on Friday, as are part of a larger nine-month study titled 'Into the Web of Profit' sponsored by the cybersecurity advisory.
Covert data collection found that PayPal and other digital payment systems are employed by cybercriminals to launder money.
“Today it is easy for hackers to infect machines, steal data, and hold businesses and individuals for ransom or sell stolen IP because enterprise defences are not fit for purpose,” said Gregory Webb, CEO of Bromium in a statement. “It is equally easy for them to wash that money and convert it into cash – and the rise in use of unregulated, virtual currencies is making this even easier.” Webb added.
Many cybercriminals are using virtual currency to make property purchases which convert illegal proceeds into legitimate cash and assets, Bromium warned. Websites such as Bitcoin Real Estate offer everything from penthouse suites and lavish mansions, to 160-acre private islands, all with the option to buy using bitcoins. Properties purchased with cryptocurrency are not as closely scrutinised because cryptocurrencie aren’t regulated by any central banks or governments, Mromium noted.
The study found that nearly 25 percent of total property sales are predicted to be in cryptocurrency in the next few years. This is concerning financial analysts who worry that allowing swifter, more covert transactions, many with criminal origins, will disrupt global property markets. Further, covert data collection found that PayPal and other digital payment systems are employed by cybercriminals to launder money.
The report also indicates that cybercriminals are spending “considerable time” converting stolen income into video game currency or in-game items like gold, which are then converted into bitcoin or other electronic formats. Games such as Minecraft, FIFA, World of Warcraft, Final Fantasy, Star Wars Online and GTA 5 are among the most popular options because they allow covert interactions with other players that allow trade of currency and goods.
“Gaming currencies and items that can be easily converted and moved across borders offer an attractive prospect to cybercriminals,” said the report's author, Dr. Michael McGuire, senior lecturer in Criminology at Surrey University. “The attraction is obvious. It’s digital, so is an easily convertible way of acquiring and transferring cyber-crime revenue,” McGuire said in a statement.
The full findings will be presented at the RSA Conference in April.