Drug barons “are not using cryptocurrencies” to launder money, according to a high-ranking detective from the UK’s Metropolitan Police Service. Detective Chief Superintendent Michael Gallagher, Scotland Yard’s head of specialist crime, told the UK’s Guardian newspaper that cash was still the preferred medium of money laundering among drugrunners in the UK, with money service businesses (MSBs) replacing banks as the alternative of choice for gangs.
DCS Gallagher explained to the newspaper, which has a notoriously anti-crypto stance, that British drugs gangs have moved from laundering money through banks to MSBs like bureaux de change, money-transfer brokers, and payday-loan services. The reason for this is the tightening regulations around banks to stop criminals using them, so they have turned to alternative means.
Interestingly, these alternative means have not included cryptocurrency, at least not to the extent that the mainstream media makes out:
They are not doing everything on plastic. And they are not using cryptocurrency. It’s all £10, £20, £50, thank you very much, cash, cash.
Adding that “Cash is still king” among drug dealers, Gallagher explained that it was easier for criminals to send money through MSBs than to do it through cryptocurrencies, illustrating the impact of regulations in the crypto space. This echoes a noticeable pattern over the past two years which has seen various entities stating that cash is still the preferred vehicle for drug dealers and terrorists.
Authorities “Tarring the Whole Sector”
In a statement that echoes the complaints by almost everyone in the crypto community, Bob Lyddon of the Association of UK Payment Associations complained that everyone was being tarred with the same brush:
They should eliminate the bad actors. All they [the authorities] are doing at the moment is tarring the whole sector. Close down the bad actors, and take strong action against the illegal sector, but at the same time make sure the good actors can operate because they provide a valuable service.
Mainstream Media Gets it Wrong Again
The news that cash is still the preferred medium for drug dealers and that the likes of payday lenders, which are visible on every high street in the UK, are preferred to cryptocurrencies to launder their proceeds is at odds with the general perception put about by the likes of the Guardian, and those of us in the crypto sector should make sure that we are doing all we can to reports like this are given as much publicity as possible to redress the balance.