In October 2021, the U.S. Department of Justice (DOJ) established the National Cryptocurrency Enforcement Team (NCET) amid growing concerns about the illicit use of cryptocurrency and related national security threats from North Korea, sanctions evasion, terrorist financing and weapons proliferation.
On July 20, 2023, the DOJ announced that the NCET had been merged into the Department’s Computer Crime and Intellectual Property Section (CCIPS).
In this episode TRM’s Ari Redbord sat down with the newly appointed NCET Acting Director Claudia Quiroz to discuss:
- The NCET’s work;
- Its merger with CCIPS; and,
- the future of crypto-related investigations and prosecutions.
Watch the recording for the full conversation or read our recap below.
What is NCET and what does it do?
According to Ms. Quiroz, the formation of the NCET formalized and prioritized the DOJ’s focus on public safety threats posed by the misuse of cryptocurrency and digital assets. She explained that it comprises “extraordinary and experienced lawyers” from across the Department as well as the Securities and Exchange Commission, each with deep knowledge of the crypto-related threat landscape.
Ms. Quiroz specified that the NCET’s primary objectives are to:
- pursue and support U.S. cryptocurrency and digital asset-related criminal investigations and prosecutions;
- provide strategic advice and expertise to the field, including via training for U.S. and international law enforcement and prosecutors; and,
- serve as a liaison between the DOJ and its domestic and international law enforcement, regulatory and private sector partners.
“While still in its infancy, the NCET has proven efficient and effective,” explained Ms. Quiroz, adding that it “has built an outstanding group and culture in a short period of time.” Major NCET cases were announced in early 2023. Ms. Quiroz further highlighted the group’s work in deepening the level of crypto expertise in U.S. Attorney’s Offices across the country, and its growing partnerships with these offices.
Meet the NCET’s New Acting Director?
Ms. Quiroz, a federal prosecutor with the U.S. Attorney’s Office in the Northern District of California, was named Acting Director of NCET on July 20, 2023. She was among NCET’s original deputy directors. Ms. Quiroz's wide-ranging cryptocurrency investigative experience includes cases that led to the landmark seizure of USD 3.36 billion in bitcoin that had been stolen from darknet marketplace (DNM) Silk Road, and the takedown of Russian DNM Hydra Market.
As Acting Director of NCET, Ms. Quiroz oversees a team of more than 20 detailees from U.S. Attorney’s Offices across the country and trial attorneys across DOJ’s criminal division. During the TRM Talks, Ms. Quiroz outlined the main functions of her role which include providing guidance, leading capacity building and training initiatives for the DOJ and law enforcement community, and setting priorities for the Department’s crypto and digital assets strategy.
What does NCET’s merger with CCIPS mean for crypto criminal enforcement?
The NCET’s merger with CCIPS effectively makes NCET a team within the computer crime section. While the NCETs focus will remain the same, according to Ms. Quiroz, it will now have the resources of a larger section and have a permanent home with the DOJ as the Department focuses on building capacity for the new and emerging digital landscape.
Ms. Quiroz views the step as a “very positive development” in terms of the DOJ’s thinking on crypto-related crime. Criminals are increasingly moving into the digital space, using cryptocurrencies to commit a range of traditional offenses. According to Ms. Quiroz, the merger reflects the Department’s recognition that crypto expertise ought to sit within, rather than separate from, the broader investigative efforts of its computer crimes division and the Department writ large including the DOJs money laundering and asset recovery section.
NCET’s mission and collaboration with U.S. Attorney’s Offices and other DOJ sections and agencies will remain unchanged, according to Ms. Quiroz. The NCET will continue to investigate and (where appropriate) prosecute criminal offenses involving the abuse of cryptocurrency and further its outreach and training work, “supporting all types of criminal investigations and litigation involving digital assets.”
What emerging trends are NCET and the DOJ most focused on today?
According to Ms. Quiroz, the NCET is currently focused on fraud cases including pig butchering and crypto confidence scams.
The NCET is also closely following national security related threats such as sanctions evasion, hacks and other exploits tied to terrorist organizations and nation state actors like Russia and North Korea that look to take advantage of the crypto ecosystem. Cyber and crypto-related national security threats have been a focus of the DOJ in recent days. In June 2023, DOJ set up a dedicated cyber section (NatSec Cyber) within its National Security Division to boost its capacity to disrupt these growing threats.
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