Money Laundering Scheme Through Drop Accounts for Online Casinos in Ukraine Exposed
The Bureau of Economic Security of Ukraine (BEB) has exposed a large-scale money laundering scheme linked to online casinos. As a result of the investigation, a network of illegal processing centers was uncovered, using drop accounts to conduct payments and legalize proceeds from gambling. This scheme operated in several major cities of Ukraine, including Kyiv, Odessa, Kharkiv, and others.
Scale of the Criminal Scheme
According to the investigation, up to $3.8 million (or approximately 5 million UAH per day) flowed through this scheme monthly, with a daily turnover of $130,000 or 5 million UAH. The offices through which these operations took place were located in cities such as Kyiv, Kharkiv, Odessa, Zhytomyr, Kremenchuk, and Kryvyi Rih. The scheme allowed the concealment of the true sources of funds by depositing them into the accounts of individual entrepreneurs (FOPs) and other drops.
Drops are individuals who, for a fee, provided their personal data to open bank accounts. They received between 500 to 30,000 UAH per transaction, which were then used to launder the funds. On average, drop accounts held about 3,900 dollars, which helped conceal financial transactions from banks and tax authorities.
How Did the Scheme Function?
The main tool for conducting transactions were bank accounts opened in institutions such as Monobank, A-Bank, PUMB, Isibank, Vostok Bank, and others. Using P2P platforms and the cryptocurrency USDT, the organizers transferred funds between drop accounts and then to online casino players’ accounts. VPN services and Turkish IP addresses were used to hide the location of the participants and speed up the process.
One of the key elements was the use of mobile devices to manage up to 450 accounts simultaneously. Special software and messengers like Telegram were used by the organizers to ensure quick transfers and mask their financial operations.
Seized Evidence and Consequences for Offenders
During the raids, the following items were seized:
- About 400 mobile devices
- 50 computers
- 5000 SIM cards
- 500 bank cards
These devices were used to manage the funds transfer process and ensure the operation of the scheme. The investigation also revealed that offenders used about 450 different bank accounts from a single device.
Investigative actions are still ongoing, and a pre-trial investigation is underway into criminal offenses such as illegal gambling activities, tax evasion, and money laundering.
Impact on Ukraine’s Financial Market
The money laundering scheme through drops has attracted the attention of government agencies, as it harms Ukraine’s financial system. In response to such threats, since February 1, the country’s banks have started imposing restrictions on card-to-card transfers, setting a monthly limit of 150,000 UAH to prevent fund withdrawals through individuals’ accounts. Strengthened financial monitoring and control over suspicious transactions are also helping to combat illegal transfers.
Conclusion
The exposure of this scheme highlights how large sums of money can be laundered through the use of drops and front accounts. Despite the advanced technologies and methods used to conceal operations, law enforcement agencies continue to work on exposing such criminal networks and holding their participants accountable.