Deltec Bank funds seized by the US Secret Service in fraud and money laundering investigation
The US Secret Service seized several corporate accounts last month controlled by Deltec Bank, a Bahamian bank with ties to cryptocurrency-related companies.
New documents Unsealed in federal court Monday reveal that the Secret Service seized several US bank accounts controlled by Deltec last month.
According to the documents, the amount seized by US authorities exceeds $58 million.
The seizures were made amid an investigation into organized international criminal money laundering syndicates operating cryptocurrency investments and other wire fraud scams.
The bank accounts that were seized by the secret service were custodial accounts with Mitsubushi Bank UFJ Trust in New York, opened by Deltec on behalf of corporate clients.
US authorities linked certain Bahamian bank customers to shell companies involved in a cross-border scheme.
The scheme allegedly involves the creation of fake crypto websites to trick victims into depositing their assets or cash.
74 shell companies identified in international fraud
The US law enforcement agency has identified at least 74 shell companies involved in this international fraud scheme.
According to the affidavit filed in an Eastern District of Virginia court, officials traced the funds linked to the shell companies before transferring them to accounts in the Bahamas.
The US Secret Service further noted in its order that the international fraud scheme worked by luring victims into investing their digital assets or cash in accounts that did not actually exist.
Victims were promised a sizeable return on their investments.
The fake cryptocurrency website would display an increase in the victim’s account balance to force more deposits. However, no withdrawals from the website were processed.
Mitsubushi Bank reported the accounts to authorities that Deltec maintained with them on behalf of those shell companies, Axis DigitalLimited and GTAL, as they were unable to obtain information about the Bahamas bank’s companies.
The Secret Service discovered that the shell companies received wire fraud proceeds and transferred them to one of the bank’s custodial accounts, which then transmitted them to other accounts in the Bahamas.
The companies structured these wire transfers in such a way as to avoid the scrutiny that normally applies to cross-border payments.
US officials claimed that banks operating in the United States require KYC (Know Your Customer) information to open a bank account. However, law enforcement officials were unable to identify the registered agents, business locations, or business purposes of Axis DigitalLimited and GTAL,” the affidavit states.