The recent shutdown by US authorities of internet domains connected with Liberty Reserve has sparked a continuing debate. Liberty Reserve, a respected legitimate payment method, offers its users much needed and valued privacy for their financial transfers. Liberty reserve does not require extensive user details for account creation, a valuable policy for many internet users who are concerned about online privacy and security.
The May 24 raid also saw five people arrested and an undisclosed number of bank accounts seized. The arrested are company founders Arthur Budovsky and Vladimir Kats, Azzedine El Amine, Mark Marmilev, and Maxim Chukarev. The shutdown operations took place in New York, Spain, and Costa Rica.Two additional company employees charged in the Costa Rica case, Ahmed YassineAbdelghani and Allan Esteban Hidalgo Jimenez, are still wanted by police.
The money transfer company based in Costa Rica was deemed accessory to cyber thieves worldwide through money laundering operations. The cyber criminals used the service to clean $6 billion through private digital transfers.Liberty Reserve is not the only business involved in the laundering operations. Jose Pablo Gonzalez, the Costa Rican prosecutor leading the case, revealed that other similar businesses were also used to hide traces of money earned from drug trafficking outfits and online child pornography operations.
Cyber Criminals Like Money Transfer Services
Because of the digital nature of the above money transfer services, cyber criminals are attracted to them. They prefer digital transfers for use in money laundering phase of their operations. Since digital currency can be easily exchanged for cash, it is very convenient.
Reports from the New York US District Court indictment reveal that the company has over 200,000 users in the US, and a total of over a million users worldwide. The service was thoroughly abused by these cyber criminals, who comprise the majority of the users. Liberty Reserve has been used to enable the completion of a variety of crimes, “including credit card fraud, identity theft, investment fraud, computer hacking, child pornography and narcotics trafficking,” according to US Attorney PreetBharara.
Liberty Reserve was used to funnel tens of millions of dollars. Money was transferred to accounts in countries including Russia, China, Cyprus, Hong Kong, Australia, Spain and Morocco. The accounts were set up for the sole purpose of serving the laundering operations. Steps are being taken by US authorities to protect people from future abuses of this kind.
People Need Trusted Services
This recent scandal has caused undue suspicion that has harmed legitimate businesses. This is a side effect of hacker activity that tarnishes the name of trusted services. People like having private money transfer services. They are valuable to every consumer for securing finances and keeping payments private. But when news like this goes around, there are those who would rather not be connected with services suspected of dealing with criminals.
It is understandable that people want to stay away from negative associations, but they may sacrifice good business relationships in the process. Services that they can trust may be shunned for alternatives. These alternatives, however, may not be as secure. This creates another problem for people as they again go through the process of testing a new service to measure its reliability.
This phenomenon is quite common, increasingly so in the virtual world. Financial services in particular are affected as frequent hacker targets. Because people need to trust services such as banks, they are easily scared by news of security breaches. Online banking and virtual payment systems have become almost indispensable to many consumers. When these methods become risky, people think about switching services. But alternative security measures are available and should be explored before such a rash decision is made. VPN services for one have proven to be very effective in securing online transactions. This combined with caution on the part of the consumer when dealing with sensitive information, there is no need for worry. A VPN secures all traffic flowing to and from the user’s computer so it cannot be stolen. The sensitive data transmitted during transactions like money transfers and payments is encrypted so it cannot be read by anyone except the two transacting parties. There really is no need to panic and jump ship when you have a good service like this to watch your back. The best VPN services, like private financial services, are also dedicated to maintaining privacy. This means that the security of your identity is part and parcel of the service.
