On the shallow surface of Instagram, Ramon Hushpuppi Abbas was a quintessential influencer.
The flamboyant Nigerian portrayed a lavish lifestyle of private jets, luxury cars, and designer clothes.
His glamorous adventures had earned him over 2 million followers and millions of dollars.
But his posts concealed a darker reality.
The 41-year-old was one of the most prolific money launderers in the world, according to the FBI.
By his own admission, Hushpuppi conspired to launder over $300mn in just 18 months.
One of his alleged clients was a certain Kim Jong Un the supreme leader of North Korea.
Tech was transforming money laundering.
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In 2019, the group broke into Maltas Bank of Valletta.
At that stage, theyre in the banks vaults, White tells TNW.
They can take the money out, but they need to send it somewhere.
They cant send it to Kim Jong Uns bank accounts that would be pretty obvious.
So instead, they dial up Hushpuppi.
Hushpuppi was open for business.The fraudster provided bank accounts to wash the stolen money.
Prosecutors said he helped launder around $14.7mn from the raid.
The Maltese heist exposed the value of a tech-savvy money launderer.
Even virtuous hackers backed by a nation-state needed an ally like Hushpuppi.
Once they get there, theyre not necessarily so good at spiriting the money away.
So they turn to a whole bunch of dark web accomplices.
These accomplices became the subject of Whites forthcoming book,Rinsed.
At theTNW Conferenceon June 20-21 in Amsterdam, hell discuss his investigation in detail.
Ahead of the event, White provided a sneak peek at the findings.
Hushpuppis social media fame made him an unusual accomplice.
Using Snapchat and Instagram, he recruited money mules to help transfer stolen money from victims to criminals.
As the profits filtered through a net of bank accounts, they became harder to trace.
Prospective money mules were offered big bucks for tiny tasks and a window into far larger fortunes.
With his theatrical displays of wealth, Hushpuppi was a living billboard for the potential rewards.
It wasnt just cyber criminals that these high-tech money launderers were helping out.
Younger followers are particularly susceptible to the temptation.
And thats a powerful tool for recruiting money mules.
It certainly proved powerful for Hushpuppi.
They would use either their existing bank accounts or open new ones.
The cash would flow between them via electronic transfers.
It was a lucrative operation, but it came with costly drawbacks.
Investigators used Hushpuppis Instagram and Snapchat to track his whereabouts and collect evidence.
Cryptocurrency can be a force for good.
It can bank the unbanked, disrupt centralised financial systems, and addprivacyto transactions.
All of these attractions appeal to law-abiding citizens.
Unfortunately, theyre also highly alluring to money launderers.
Because vast sums constantly circulate at fluctuating valuations, the dirty money is also easier to hide.
Accounts are also quick and free to open.
By using computer scripts, its possible to execute large-scale money laundering schemes with thousands of transfers.
Its a process thats becoming increasingly accessible.
Specialised cryptocurrency money laundering services have removed the need for technical expertise.
According toChainalysis, illicit addresses sent nearly $23.8bn of cryptocurrency in 2022 68% more than in 2021.
Mainstream centralised exchanges were the biggest recipients, accounting for just under half of all the funds.
Another reason for this growth is the cost savings.
A traditional money launderer could charge a first-time client a whopping 60% cut of the proceeds.
Even regular customers can pay 40-60%.
In the world of cryptocurrency, the fees can drop dramatically.
White knows of brokers who charge as little as 4%.
Sometimes the cryptocurrency industry is not only a facilitator for money laundering.
It can also be a target.
Another tool for cryptocurrencies is blockchain-based games.
One of the genres most popular titles is Axie Infinity, which has attracted millions of players.
Its also caught the attention of cybercriminals.
Investigators soon pinpointed a culprit: North Koreas Lazarus Group.
The gang had pulled off one of the biggest-ever crypto heists.
To launder their stolen fortune, they turned to a service called Tornado Cash.
Tornado Cash is whats known as a crypto mixer.
It helps people protect their privacy, which in crypto transactions is important, White says.
Unfortunately, it also helped the North Koreans successfully launder stolen money.
A technology invented by libertarian coders had been exploited by one of the worlds most authoritarian regimes.
The Lazarus Group had created another headline-grabbing case of high-tech money laundering.
But they were merely the tip of the iceberg.
During hisinvestigations,White discovered that the new techniques were going mainstream.
I realised that it wasnt just cyber criminals that these high-tech money launderers were helping out, White says.
Its all types of criminals: drug dealers, prostitution rings, child sexual abuse rings.
As for Hushpuppi, he remains detained in the US, but his legacy as an influencer lives on.
The advances in money laundering suggest his wish has come true.
Geoff White is speaking at this yearsTNW Conferenceon June 20-21 in Amsterdam!
If you also want to experience the event (and say hi to our editorial team!
), weve got something special for our loyal readers.
Story byThomas Macaulay
Thomas is the managing editor of TNW.
He leads our coverage of European tech and oversees our talented team of writers.
Away from work, he e(show all)Thomas is the managing editor of TNW.
He leads our coverage of European tech and oversees our talented team of writers.
Away from work, he enjoys playing chess (badly) and the guitar (even worse).
