Crypto Crime Training Boosts Ukraine Security

Advancing Efforts in Combating Cybercrime and Enhancing Global Security

In a significant stride towards countering cybercrime and reinforcing worldwide security endeavors, the IRS Criminal Investigation (CI) recently joined forces with international counterparts to offer advanced training to Ukrainian law enforcement officers.

The primary focus of this initiative was to delve into the complexities of cryptocurrency and the intricate realm of blockchain tracing.

Fortifying Global Measures Against Crime Involving Cryptocurrencies

Building upon the success of the previous cyber training provided to Ukrainian law enforcement in May, the IRS Criminal Investigation (CI) partnered with the Dutch Fiscal Information and Investigation Service (FIOD) and His Majesty’s Revenue and Customs (HMRC) from the UK.

Collectively, they orchestrated a subsequent training session spanning from September 18th to 21st, geared towards enlightening nearly 40 Ukrainian law enforcement officers on the nuances of cryptocurrency and blockchain tracing.

This online training equipped Ukrainian law enforcement with essential tools to combat money laundering, dissect fraudulent cryptocurrency transactions, and augment their proficiency in blockchain forensic investigations.

As outlined in the official press release, the CI, FIOD, and HMRC collaborated with blockchain analytics firms CipherTrace and BlockTrace to facilitate this training.

The participants of this training represented various Ukrainian law enforcement agencies, including the Cyber-Police Department of the National Police of Ukraine, the Economic Security Bureau of Ukraine, the Security Service of Ukraine, the National Anti-Corruption Bureau of Ukraine, and Ukraine’s State Bureau of Investigation.

Following the successful completion of the training and a rigorous examination, the participants were granted accreditation as Certified Cryptocurrency Tracing Examiners (CCTE).

Expressing his thoughts, CI Chief Jim Lee emphasized in a statement,

“I consistently emphasize the significance of public-private partnerships, and the training we’ve imparted to our Ukrainian law enforcement partners stands as tangible proof of how government agencies and the private sector have united on a global scale to deter those evading sanctions.”

In May 2023, in collaboration with their partner and blockchain intelligence platform Chainalysis, CI initiated an initial round of cyber training for Ukrainian law enforcement. The principal objective was to concentrate on identifying and disrupting the financial networks utilized by individuals attempting to conceal their assets, thereby violating sanctions.

Circumventing Sanctions

A year after the invasion of Ukraine, fundraising groups affiliated with the Russian military have successfully garnered millions of dollars in cryptocurrencies, despite the imposition of US and international sanctions.

Previously, it was believed that Russian military procurement and disinformation groups had amassed around $4.2 million, a notably smaller figure compared to Ukraine, which accumulated $212 million during the same period. However, recent research conducted by blockchain analytics firm Elliptic indicates that Russia had amassed up to $20 million in cryptocurrencies.

Remarkably, over half of these funds have been channeled through US-sanctioned entities, with more than 80% of the funds flowing through centralized crypto exchanges. These entities have also taken advantage of decentralized finance (DeFi) protocols, NFT services, and decentralized exchanges.

In addition to this, certain individuals and groups have embraced cryptocurrency for fundraising and incentives, even actively promoting NFT projects to support the war effort.

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