Irish Gangs Use Private Vaults for Crypto Key Storage

Organized Crime Rings Storing Crypto Keys in Vaults, Irish Authorities Report

Organized crime groups in Ireland are increasingly using secure vaults not only for illicit cash, luxury goods, and counterfeit documents, but also to store the private keys and seed phrases that control cryptocurrency wallets, according to the head of the Criminal Assets Bureau.

Detective Chief Superintendent Michael Gubbins, who leads the state’s asset-seizure agency, told the Sunday Independent that this emerging trend was uncovered through the bureau’s investigations and has been flagged to the government’s Anti-Money Laundering Steering Committee.

“The contents of these vaults could be cryptocurrency keys, or cash, or watches, or could even be passports,” Gubbins stated, adding that this observation stems from the bureau’s direct experience.

The Anti-Money Laundering Steering Committee is currently preparing Ireland for new EU regulations scheduled to take effect next summer. These rules will impose a ban on cash transactions exceeding €10,000 and mandate that businesses verify the identity of individuals making cash payments of €3,000 or more. Consequently, crypto-asset service providers, luxury goods retailers, and crowdfunding platforms will face enhanced regulatory oversight. Ireland recently published its inaugural national anti-money laundering strategy, following an action plan that bolstered safeguards for cryptocurrencies.

Gangs are reportedly turning to cryptocurrency as a means to mitigate the risk of asset seizure and to leverage the perceived anonymity it offers. “They believe there’s an anonymity attached to it,” Gubbins explained, although he also acknowledged that price volatility and the potential loss of wallet passwords present significant challenges.

Despite this shift, Gubbins indicated that the use of cryptocurrency in Ireland remains “still quite basic,” with cash continuing to be the predominant medium for illicit funds. “It’s still a cash business for those engaged in drug trafficking,” he noted.

The Criminal Assets Bureau has instead encountered professional money launderers for hire, including operators of hawala systems. Hawala is an informal financial network where cash deposited in one country can be paid out in another without physically crossing borders. Gubbins estimated the commission for such services to be around 6%. In one investigation, the bureau successfully recovered €230,000 from a safe deposit box at a private vault company.

In a separate ongoing operation, the bureau is managing the largest cryptocurrency seizure in its history. With assistance from Europol, investigators successfully accessed the first of 12 cryptocurrency wallets in March. These wallets contain 6,000 Bitcoin (BTC) that were confiscated from a cannabis grower in 2019. The grower’s private keys, reportedly written down and concealed within a fishing rod case, were subsequently lost. Gubbins confirmed that over €130 million of the total €360 million holding has now been liquidated.

Last year, the Criminal Assets Bureau returned nearly €15 million to the Irish exchequer.