Huione Pay, a Cambodian currency exchange and payments company, has been implicated in laundering over $150,000 in cryptocurrency stolen by the North Korean hacking group Lazarus. The stolen funds were linked to hacks of three crypto firms conducted by Lazarus last year, and Huione Pay claimed it was unaware of receiving funds indirectly from the hacks. Despite the anonymity of cryptocurrency transactions, blockchain data allowed for tracking the movement of funds from wallet to wallet, revealing Huione Pay’s involvement in the laundering scheme.
The National Bank of Cambodia prohibits payments firms in the country from dealing in cryptocurrencies and digital assets since 2018 to mitigate risks associated with volatility, cybercrime, money laundering, and terrorism financing. After the revelation of Huione Pay’s involvement in money laundering, the NBC indicated that corrective action might be taken against the company. U.S.-based blockchain analysis firm TRM Labs reported that Huione Pay was among several payment platforms and OTC brokers that received the majority of crypto stolen in the Atomic Wallet hack.
Huione Guarantee, an online marketplace operated by the Huione Group, a Cambodian conglomerate, has been facilitating online scams in Southeast Asia, leading to transactions exceeding $11 billion, with a significant portion traced to money laundering and cyber scams. The Elliptic research team quantified the cryptocurrency transactions on Huione Guarantee, revealing its involvement in facilitating cyber scams. Despite the challenges faced by the cryptocurrency market, a record recovery rate of 77% for stolen funds was achieved in the second quarter of 2024, with $347.4 million out of the total $512.9 million lost successfully recovered or frozen.
The hackers involved in the laundering scheme utilized the Tron blockchain, known for its speed and low transaction costs, to convert the stolen cryptocurrency into various forms, including tether (USDT), a stablecoin pegged to the U.S. dollar. The laundered funds were primarily sent to exchanges, services, and OTC brokers, including Huione Pay, highlighting the company’s involvement in the sophisticated laundering operation. Despite facing regulatory restrictions from the NBC, Huione Pay continued to engage in illicit activities, raising concerns about the effectiveness of existing regulations in combating money laundering and cybercrime in the cryptocurrency space.
The prevalence of online scams in Southeast Asia facilitated by platforms like Huione Guarantee underscores the need for enhanced regulatory oversight and enforcement to prevent money laundering and cyber scams. The resilience of the cryptocurrency market in recovering stolen funds demonstrates the evolving landscape of security measures and blockchain analytics used to combat illicit activities. As the cryptocurrency ecosystem continues to evolve, regulators, law enforcement agencies, and industry players must collaborate to address emerging threats and safeguard the integrity of the financial system against money laundering and cybercrime.
