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rsstacktoday at 7:13 PM4 repliesview on HN

How is it not a violation of AML laws to pay a ransom like this? Surely they didn't verify that the recipient (a criminal) isn't sanctioned or associated with sanctioned organizations.


Replies

cornholiotoday at 8:01 PM

Money laundering is the action of obfuscating the origin of criminal proceeds; victims or clients of criminals do not generally commit money laundering, for example buying drugs is not a form of AML violation regardless of the legality of the purchase itself or the fact that the funds will later be laundered by the traffickers.

KYC is a tool to prevent money laundry and it's typically an obligation of financial institutions. Sending money to an anonymous (to you) recipient is generally not a KYC violation if you are not in the money transmitting business and you aren't doing the payment on behalf of someone else.

There are infinite shades of gray in this topic, of course, but I can't see AML being relevant in this particular case.

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spondyltoday at 9:24 PM

Probably not too relevant but off the top of my head, the New Zealand Government's guidance on ransomware payments is that you could technically be fined if you pay a ransom to an entity in a sanctioned country, although it doesn't go into specifics

jawigginstoday at 7:36 PM

Even if it already is, the DoJ can exercise discretion in choosing who to prosecute. There has to be political will to threaten an org who has just suffered from an attack with further consequences if they make a payment.

hattmalltoday at 7:47 PM

How exactly would this fall into the purview of AML? As far as sanctions go the burden of proof would be on the government to prove the money went to a sanctioned entity and Instructure isn't a bank subject to KYC requirements.

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