Colorado Has a Massive Home-Grown Crypto Crime Problem
In a shocking revelation, a Chinese crypto service called Xinbi Guarantee was found to be operating out of Colorado, facilitating money laundering, harassment, hacking rings, and sex trafficking. The operation, which has been identified by cryptocurrency-tracking firm Elliptic, had been hiding in plain sight until its illicit activities were recently exposed.
Xinbi Guarantee is an online marketplace that was reportedly used to launder money, orchestrate harassment campaigns, and facilitate hacking rings. The service also offered "pig butchering" schemes, which involve a fraudster developing a close relationship with a target before tricking them into investing in phony financial opportunities.
According to Elliptic's latest report, Xinbi Guarantee has been involved in transactions totaling around $8.4 billion, primarily using Tether stablecoins. The bulk of these transactions were related to "pig butchering" schemes and other financial scams.
The service was also used to hawk Starlink internet devices, which have been used to power criminal groups around the world. Large sums of stolen crypto funds connected to North Korean hacking sprees have also moved through the platform.
Other business dealings on the site were even darker. Some criminals offered physical harassment campaigns, while others appeared to be using the site to sell people, including girls as young as 14, for sex.
The extent of these illicit activities highlights the growing threat of cryptocurrency-based crime syndicates.
According to state records, Xinbi Guarantee was registered in an Aurora office park in 2022 by someone named "Mohd Shahrulnizam Bin Abd Manap." However, it has since become "delinquent."
Jacob Sims, a visiting fellow at Harvard's Asia Center, told Wired that incorporating a business in the US can offer an air of legitimacy and possible routes to hiring staff and making inroads with US entities. However, given the delinquency, Sims added, that might not have worked out.
In response to Elliptic's report, Telegram shut down accounts related to both Xinbi Guarantee and a similar platform, Huione Guarantee. According to Telegram, "Criminal activities like scamming or money laundering are forbidden by Telegram's terms of service and are always removed whenever discovered."
However, the marketplaces have been known to resurface quickly, with Sims describing them as "remarkable for both the scale at which they're operating, and also the brazenness."
The revelation that Xinbi Guarantee was operating out of Colorado highlights the need for greater awareness and cooperation between law enforcement agencies, cryptocurrency firms, and social media platforms to combat illicit activities.