Treasury takes steps to hindered Huione Group, allegedly involved in virtual currency money laundering.
A Tight Squeeze for Huione Group:
The U.S. Treasury Department is set to cut off a Cambodian conglomerate, Huione Group, from the American financial system under a new proposal.
Announced on May 1st, the Financial Crimes Enforcement Network (FinCEN) plans to label Huione Group as a "primary money laundering concern." This move would prevent U.S. financial institutions from maintaining or opening correspondent or payable-through accounts for Huione Group.
Treasury Secretary Scott Bessent stated, "Today's proposed action will sever Huione Group's access to correspondent banking, degrading these groups' ability to launder their ill-gotten gains."
Although Huione Group doesn't directly bank in the U.S., FinCEN alleges that the conglomerate operates through overseas firms with indirect access to the American financial system. According to reports, this access has enabled Huione to support illicit cybercriminal operations, such as laundering cryptocurrency for North Korea's infamous Lazarus Group.
Authorities claim that Huione Group has laundered over $4 billion in illicit funds between August 2021 and January 2025, with a portion of these funds linked to online scams, including popular fraud schemes like "pig butchering."
One of Huione's biggest concerns is its sprawling network of businesses, such as Huione Pay, a payment services firm, and Huione Crypto, a virtual asset platform. FinCEN has also flagged Huione's stablecoin, USDH, which is pegged to the U.S. dollar but designed to evade freezing. Officials suspect that this stablecoin is used to bypass oversight and quietly funnel illicit funds into fiat currency.
In response to these allegations, blockchain forensics firm, Elliptic, raised red flags around Huione in July 2024, pinpointing it as a central hub for Southeast Asian cybercriminals. Describing the company's marketplace as the largest of its kind, the report highlighted thousands of Telegram channels offering laundering services, scam website tools, and even human trafficking-related services.
The platform's mobile app was eventually delisted from the Google Play Store in January following criminal allegations, but it remains active on the Apple App Store.
The proposed rule is now open to public comment for 30 days before it can take effect.
In July 2024, Tether froze nearly $30 million in USDT linked to Huione accounts, potentially leading to the launch of USDH, Huoine's stablecoin.
This blockbuster move could significantly disrupt Huione Group's operations and reputation, potentially driving away non-U.S. financial partners. If the proposed rule is finalized, it would mark a major blow to Huione Group, isolating it from global financial networks that rely on U.S. dollar transactions.
Sources:- [1] US Department of the Treasury- [2] Financial Crimes Enforcement Network (FinCEN)- [3] Elliptic- [4] CoinDesk- [5] The Block- [6] Reuters- [7] Bloomberg
- FinCEN, in its proposal on May 1st, aims to include Huione Group as a 'primary money laundering concern', thereby preventing American financial institutions from maintaining or opening accounts for the Cambodian conglomerate.
- Huione Group, despite not directly banking in the U.S., operates through overseas firms, enabling indirect access to the American financial system, according to FinCEN.
- The U.S. Treasury Secretary, Scott Bessent, stated that this measure would sever Huione Group's access to correspondent banking, reducing their ability to launder ill-gotten gains.
- Huione Group is accused of laundering over $4 billion in illicit funds, with a portion linked to online scams, including the popular fraud scheme 'pig butchering'.
- Authorities suspect that Huione's stablecoin, USDH, designed to evade freezing, is used to bypass oversight and quietly funnel illicit funds into fiat currency.
- Elliptic, a blockchain forensics firm, raised red flags about Huione in July 2024, describing it as a central hub for Southeast Asian cybercriminals.
- In response to these allegations, the platform's mobile app was delisted from the Google Play Store in January, but it remains active on the Apple App Store.
