Jul 28, 2018
Recognized as a global leader in RegTech for blockchain, Coinfirm serves as a foundation for the safe adoption and use of blockchain. The Coinfirm AML/CTF Platform uses proprietary algorithms and big data analysis to provide structured, actionable data that solves compliance and transaction risk issues in blockchain and cryptocurrencies. The blockchain agnostic platform is currently used by anyone ranging from major financial institutions to exchanges. In addition, Coinfirm develops dedicated blockchain solutions such as the data provenance platform Trudatum that was recently integrated by the largest bank in CE.
Welcome to week 6 of the Crypto Alert of the Week series by AMLT, a series dedicated to documenting interesting or high profile frauds/hacks etc that recently happened and have been reported into the AMLT Network and show how the AMLT Network can help track and prevent it in the future.
With a constant influx of new, inexperienced, and sometimes downright greedy users looking for a quick return, many fraudsters have been attracted to the cryptocurrency market. One of the most simple yet common types is the "multiplier". Although not all multipliers are technically “scams” or “fraud”, a large amount are. Generally the process is, some sort of site tells cryptocurrency holders that they're a group of experienced traders/investors or have a large mining operation among other stories that guarantees astronomical returns within a very short period of time. Here’s an example below that we’re going to use throughout this Crypto Alert and AMLT Network use case. In this case the site claims a potential 100x return in 12 hours! There are a few very good ways to confirm whether one of these is true fraud or not and we’ll share one of them below as well.
These Bitcoin Multipliers highlight another of the countless potential ways that cryptocurrency users around the world can use the AMLT Network to help prevent these sort of actors from reaping the spoils of their dishonest work. So how did we confirm this one was in fact fraud? Below we show you how this process works and what is the end result through a Coinfirm AML Risk Report.
By looking at a few of the addresses that have paid into the “mulitiplier” address, none of them after an extended period of time received any funds back let alone profit.
Once the address and related proof (screenshot) has been submitted into the AMLT Network, the Coinfirm data analytics team analyzes and verifies if the data submitted is legitimate. If it is it gets submitted into the Coinfirm Platform with appropriate new flags and risk indicators. As you can see below in the most recently generated risk report on this address. Now any of the countless commercial users of the Coinfirm AML Platform around the world can reject these funds originating from fraudulent actions and help limit the incentive of bad actors to do them in the first place.
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