Operation Atlantic devised to tackle crypto-related fraud

Syed Rahman of Rahman Ravelli outlines the three-nation approach to crypto crime.

Law enforcement agencies from the UK, US and Canada have teamed up to create Operation Atlantic in an effort to combat crypto fraud and the illicit movement of wealth.

Operation Atlantic was announced by the UK’s National Crime Agency (NCA). The NCA will work on it with the UK’s City of London Police and Financial Conduct Authority (FCA), the United States’ Secret Service agency and Attorney’s Office for the District of Columbia, and Canada’s Ontario Provincial Police, Ontario Securities Commission and Royal Canadian Mounted Police.

The initiative aims to disrupt crypto-related scams, take apart fraud networks, reclaim stolen wealth, help protect against further losses and increase public awareness of crypto investment fraud. It will provide support to cross-border operations that aim to target illegal conduct involving digital assets.

Operation Atlantic will also target people who have lost or are in danger of losing wealth via approval phishing, which is also known as pig butchering. This is where fraudsters either persuade victims to give them access to their crypto wallet under false pretences or gain access without the owner realising.

The US Secret Service has said that Operation Atlantic expands upon Project Atlas, which is an initiative started two years ago by the agency and the Ontario Provincial Police to disrupt crypto investment fraud. The Secret Service added that Operation Atlantic strengthens cross-border enforcement activities by adding more international partners than Project Atlas obtained.

Effective

The question of how effective this new approach could be is, arguably, far from simple to answer. Project Atlas has been fairly successful and has shown that a coordinated approach can produce real results. And the cross-border structure of the new initiative is significant in that it aims to combat the most difficult issue with crypto fraud –that fraudsters operate across borders and can quickly dissipate assets away from jurisdictions.

But while this initiative may prove to be effective, it may be unrealistic to expect huge immediate results. For one reason, many of the fraudsters and organised crime rings that utilise crypto as a vehicle for fraud are located in Southeast Asia, including Myanmar, Cambodia and Laos. In such poor countries, crypto fraud can actually be one of the dominant economic engines. As such, real and effective political cooperation may be difficult to attain.

UK legislation would have no reach in such countries, so any impact would be limited. Although more cross-border initiatives and data sharing frameworks could be agreed. Alternatively, the crypto industry could be more heavily regulated to stop stolen funds from leaving the UK in the first place. Yet, achieving this - given that borderless and immediate transfers are the very nature of crypto – would be a sizeable task.