Banks Associating Bitcoin with Criminal Activity Ironically Linked to $2 Trillion in Financial Crimes

Banks Associating Bitcoin with Criminal Activity Ironically Linked to $2 Trillion in Financial Crimes

Thousands of leaked documents from the FinCEN (Financial Crime Enforcement Network) have revealed that some of the largest banking institutions have been aiding criminals to move over $2 trillion worth of dirty money around the world in the last five years.

Out of a total of 2657 leaked files, 2121 files were suspicious activity reports (SARS), filed by the banks to notify authorities of suspicious activity on some of their clients’ accounts.

The report on the files analyzed by the BuzzFeed stated that while banks are obligated to report suspicious activity to financial regulatory authorities, many banks opted to continue allowing certain accounts to launder and move money, even after suspecting them of illegal activity.

Double Standards by the FinCEN and Banks

The major financial crimes that the banks are alleged to have facilitated involved evading transactions, money laundering, funding terrorism, drug trafficking, and scamming.

JP Morgan allowed over $1B to move through one of its London-based accounts that has been linked to a mobster on FBI’s most-wanted list, while HSBC facilitated over $1 million for fraudsters even after learning that they were under investigation in the US. Other Banks mentioned in the report are Barclays, United Arab Emirates, and the Deutsche  Bank.


The crypto community has reacted to the irony of the situation, calling this a double standard by the Banks, the majority of which fight crypto by associating it with mainly illegal transactions.

But at $2 trillion, their own illegal activity is worth almost four times the current market cap of Bitcoin. Crypto investor and advisor Crypto Whale wrote:

“Over 2500+ leaked documents confirm some of the world’s largest banks helped North Korea and other criminals launder $2 trillion dollars around the world. Huh!? But I thought all criminals only use #Bitcoin?”

Bitcoin Is More Transparent Than Banks

While the FinCEN seems to crack down harder on illegal BTC  transactions, data has shown that the transparency of the Bitcoin Network and high profile indictments have discouraged criminal activity involving Bitcoin.

On-chain analytics firm Chainalysis states that approximately $11 Billion worth of crypto transactions were associated with criminal activity in 2019, representing just 1.1% of total activity.  Additionally, unlike with fiat, where banks seemingly help to fund more serious crimes like drug trafficking and terrorism, crypto is popularly preferred by scammers.

“Scammers bilked roughly $4.3 million worth of cryptocurrency from millions of victims, and sent roughly equal amounts to other entities, presumably to convert their stolen funds to cash.”

According to a financial expert on Twitter, banks are more likely to be involved in anti-money laundering activities than Bitcoin, even with sufficient regulation, since they are also the point of conversion to fiat for many criminals who want to liquidate their crypto bounties.

“No major financial crime can happen without banks. Even the so-called crimes committed with crypto needs banks because the money needs to be converted to fiat most times to complete the transaction.”