FBI to Form Cryptocurrency Unit, Focusing on Seizure of Virtual Assets: DOJ

Law enforcement officers walk out of the J. Edgar Hoover FBI Building in Washington on Jan. 28, 2019. (Mark Wilson/Getty Images)

The FBI is forming a new team dedicated to cryptocurrency, confirmed the Department of Justice on Thursday.

Eun Young Choi, a prosecutor with a background in cybercrimes, will be tapped as the National Cryptocurrency Enforcement Team’s (NCET) first director, the agency said.

“The department has been at the forefront of investigating and prosecuting crimes involving digital currencies since their inception,” Choi said in a statement.

“The NCET will play a pivotal role in ensuring that as the technology surrounding digital assets grows and evolves, the department in turn accelerates and expands its efforts to combat their illicit abuse by criminals of all kinds,“ she added. ”I am excited to lead the NCET’s incredible and talented team of attorneys, and to get to work on this important priority for the department.”

The creation of the new “virtual asset exploitation” unit comes after the Justice Department’s largest-ever financial seizure earlier in February when it charged a married New York couple with allegedly laundering bitcoins valued at over $4.5 billion that were stolen in a hack in 2016.

Regulators under President Joe Biden have ramped up scrutiny of the crypto industry in the wake of a series of high-profile cyberattacks last year on the largest U.S. fuel pipeline network and the world’s largest beef supplier. Some ransomware groups have demanded payments in cryptocurrency.

Assistant Attorney General Kenneth A. Polite Jr. said in the news release that officials have “seen a rise in their illicit use by criminals who exploit them to fuel cyberattacks and ransomware and extortion schemes” and have been used in other crimes, including thefts and scams, money laundering, and for drugs.

The Department of Justice in late 2021 launched its own cryptocurrency enforcement agency composed of experts in money laundering and cybercrime.

At the time, Deputy Attorney General Lisa Monaco, who also announced the creation of the FBI crypto enforcement division on Thursday, said that “cryptocurrency exchanges want to be the banks of the future. Well, we need to make sure that folks can have confidence when they’re using these systems and we need to be poised to root out abuse.”

Also Thursday, Monaco also announced the creation of a new international virtual currency initiative, and said the department will be aggressive about disrupting cyber threats, even at the risk of tipping off cybercriminals and jeopardizing potential charges.

With the FBI’s latest move, some advocates of bitcoin and other cryptocurrencies suggested on Twitter that it’s tantamount to government overreach.

Reuters contributed to this report.