Japanese authorities have surprised the crypto community with startling remarks about a case involving criminals using Monero. On Monday, the National Police Agency’s Cyber Special Investigation Division and the Joint Investigation Headquarters of several prefectures arrested the ringleader of an organization allegedly involved in money laundering and computer fraud crimes.
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Yuta Kobayashi is suspected to be the boss of an organization of over 18 people dedicated to stealing credit card information through phishing tactics. He leveraged this data to launder money by purchasing fictitious products listed on Mercari, an online marketplace.
Authorities allege that Kobayashi completed over 42 purchases of these products on Mercari using stored credit card information, defrauding the operator of a part of the proceedings. The group is suspected to have been involved in 900 transactions between June 2021 and January 2022.
The group grew its numbers by posting illegal part-time job opportunities on social media and then communicated using encrypted messaging apps to coordinate its actions. However, what’s surprising about this case is that authorities claim this is the first time a suspect has been identified in Japan through an analysis of Monero.
While the Japanese cyber investigation division did not offer many details on the identification process, local media reported that information from these communication apps and an “analysis of the flow of virtual currency” led to the identification of Kobayashi as one of the individuals involved in these crimes. Damages for these crimes reached 100 million yen (almost $660,000).
While there have been similar cases involving Monero before, these have been disputed. In other instances, crime detection was achieved due to exogenous factors, not through monero trace analysis.
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Writers’ take: The allegations from Japanese authorities should be doubted until a public paper backing these Monero tracing claims appears. Law enforcement agencies benefit from these cases and may use such claims as scaremongering tactics to reduce potential criminal token use. Monero will maintain its high privacy token status until that happens.
