All IDCA News

By Loading

5 Oct 2022

Share on social media:

Pro-Russian Groups Use Cryptocurrency to Fund Military Operations and Evade United States Sanctions

A research report has revealed that funds in cryptocurrency for pro-Russian groups are being collected to maintain paramilitary operations and bypass US sanctions

TRM Labs, a digital asset compliance and risk management company, reports that these fundraising groups have raised over $400,000 in cryptocurrency since the invasion began on Feb. 24.

Research revealed that groups are using the encrypted messaging app Telegram to allow people to send funds that are used to supply Russian-affiliated militia groups and support combat training near the Ukrainian border.

Group TRM Labs found Task Force Rusich, which the US Treasury identifies as a "neo-Nazi paramilitary group that has participated in combat alongside Russia's military in Ukraine." Task Force Rusich has been sanctioned by the Treasury Department's Office of Foreign Assets Control (OFCA).

In an unknown Telegram channel, TRM Labs discovered this group seeking funding for expensive items such as radios and thermal imaging equipment. According to the report, the Novorossia Aid Coordinating Center, which was set up in 2014 to support Russian operations in Ukraine, raised approximately $21,000 worth of bitcoin and other cryptocurrencies, intending to buy drones.

Russian markets were being hit by sanctions this year due to their attack on Ukraine without any previous provocation. At the time, there was fear that Russia could employ cryptocurrency to evade these penalties. Crypto experts stated, however, that Russia doesn't have the crypto liquidity on the scale required to move money.

However, paramilitary groups are primarily involved in cash transactions and small sums, which is enough for what they need.

Ari Redbord, head of legal and government affairs at TRM Labs, said these groups are likely using exchanges that don't necessarily comply with anti-money laundering regulations.

“They're probably using different exchanges that are not compliant with the exchange protocols to process those transactions into fiat.”  Redbord said in a CNBC interview.

Also Read: CISA warns: Russian state-sponsored cyber actors exploit MFA protocols to gain access to networks

Image Credit: Nasdac

Follow us on social media: