NCA Busts Russian Crypto Networks Laundering Funds and Evading Sanctions

The U.K. National Crime Agency (NCA) on Wednesday announced that it led an international investigation to disrupt Russian money laundering networks that were found to facilitate serious and organized crime across the U.K., the Middle East, Russia, and South America.

The effort, codenamed Operation Destabilise, has resulted in the arrest of 84 suspects linked to two Russian-speaking networks Smart and TGR. In addition, £20 million ($25.4 million) in cash and cryptocurrency has been seized.

Both the businesses are based in Moscow's Federation Tower, per The Telegraph, which is known to act as a hub for money laundering firms.

Concurrent with the takedown and arrests, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) has sanctioned five individuals and four entities associated with the TGR Group.

"Through the TGR Group, Russian elites sought to exploit digital assets – in particular U.S. dollar-backed stablecoins – to evade U.S. and international sanctions, further enriching themselves and the Kremlin," said Acting Under Secretary for Terrorism and Financial Intelligence Bradley T. Smith.

Describing it as an extensive sanctions evasion and money laundering network, the Treasury Department said the TGR Group has leveraged other illicit actors such as the Smart Group, which is headed by Ekaterina Zhdanova. In November 2023, Zhdanova was sanctioned for helping high-net-worth Russian nationals and cybercriminal crews launder cryptocurrency proceeds.

Zhdanova has also been accused of offering services to individuals connected with the now-defunct Ryuk ransomware group, laundering over $2.3 million of suspected victim payments in 2021.

The TGR Group is said to provide a wide range of illegal financial services, including laundering funds belonging to sanctioned entities, an unregistered service to exchange cash and cryptocurrency, accepting cash receipts and converting them into digital assets for clients, a prepaid credit card service, and concealing the source of funds to allow Russian elites to purchase property in the U.K.

The NCA noted that the Smart network was used to fund Russian espionage operations between late 2022 to summer 2023. The exact nature of the malicious activity was not disclosed.

"Smart and TGR provide a service that enables Russian elites, and designated individuals and entities to access Western economies that would otherwise be denied to them through sanctions or other financial restrictions," the agency said.

"For the first time, we have been able to map out a link between Russian elites, crypto-rich cyber criminals, and drugs gangs on the streets of the U.K. The thread that tied them together – the combined force of Smart and TGR – was invisible until now."