German Authorities Seize 13 Crypto ATMs in Major AML Operation

German authorities conducted a significant anti-money laundering (AML) operation on Tuesday, seizing 13 crypto ATMs where Bitcoin and other cryptocurrencies were traded without proper authorization. The Financial Services Watchdog BaFin, supported by police and Bundesbank officials, led the operation, which also resulted in the confiscation of nearly €250,000 in cash. The raids took place across 35 locations throughout Germany.

The devices in question were operated without the necessary permission from BaFin, which stated that they posed significant money laundering risks. The owners of the ATMs now face prosecution and could be sentenced to up to five years in prison.

In a statement, BaFin confirmed that the operation was conducted "in coordination with the Federal Criminal Police Office (BKA)" and emphasized that it was supported by "police and the Deutsche Bundesbank."

"Changing euros into cryptocurrencies and vice versa is a matter of commercial proprietary trading or a banking transaction and therefore requires the express permission of BaFin according to the law (Section 32 of the Banking Act)," the watchdog declared.

BaFin further explained the importance of the authorization requirement, noting that it "protects both the integrity of the financial system and consumers." The agency highlighted the risks involved in trading crypto assets, warning that these risks could lead to "considerable losses, up to and including total loss."

The watchdog also pointed out that some crypto exchange machines are attractive to users with criminal intentions, particularly due to the anonymity they offer. It stressed that anyone dealing with cash amounts exceeding €10,000 must comply with "Know Your Customer" (KYC) procedures to verify the customer's identity.

BaFin noted that if there are indications of illegal money origins or connections to terrorist financing, these must be reported to the Central Office for Financial Transaction Investigations (FIU). Machines that fail to comply with due diligence obligations are "suitable for money laundering due to their anonymity."

The statement concluded by emphasizing BaFin's role in maintaining the public interest, stating, "Their main goal is to create a functional, stable, and integrity of the German financial system. Customers of banks, insurers, and investment service providers should be able to trust the financial system."

The Financial System Integrity (IF) Division, along with the Resolution and Money Laundering Prevention Division, is responsible for reviewing authorization requirements and prosecuting unauthorized transactions. This division works closely with BaFin’s Money Laundering Prevention Department.

By fLEXI tEAM