The Swedish Police Authority and the Financial Intelligence Unit (FIU) have classified cryptocurrency exchanges as “professional money launderers (PML)” after analyzing services provided by unlicensed and illegal operators.
According to the FIU, PMLs have criminal connections and facilitate numerous individuals and criminal networks in systematically laundering money.
The FIU identified four profiles based on their analysis of these illicit activities: the node exchange provider, the hawala exchange provider, the asset exchange provider, and the platform exchange provider.
The report emphasized the need for greater law enforcement involvement in monitoring crypto trading platforms to curb illegal services, stating:
“FIU Sweden assesses illicit cryptocurrency providers as an emerging threat within money laundering schemes and a crucial part for organized crime to maintain and expand their criminal markets.”
Conversely, the Swedish authorities recognized the importance of licensed and legitimate crypto trading platforms in combating money laundering activities. They urged these entities to monitor suspicious trading patterns among users and take necessary actions, such as stopping transactions and offboarding clients.
In addition, Sweden’s ongoing crackdown on illegal cryptocurrency activities recently targeted the nation’s Bitcoin mining community.
The Swedish Tax Agency conducted investigations into 21 crypto-mining firms from 2020 to 2023 and found ambiguities in their tax filings.
The investigation uncovered that 18 of these firms provided “misleading or incomplete” information to evade value-added tax on taxable operations. The agency reported, “the described approach leads to tax disappearing from the country in the form of incorrect payments of input VAT, unpaid output VAT and unreported crypto assets.”
The crypto mining firms contested a $90 million tax demand in the administrative court. Of the appeals, two were accepted, and the court stated, “the amounts above have been adjusted with regard to the verdicts.”
