Public Key Podcast

Building Bridges to Tackle Pig Butchering: Podcast Ep. 133

October 22, 2024 | by Chainalysis Team

Episode 133 of the Public Key podcast is here! Erin West has been on this podcast 3 times and all 3 episodes have been the most downloaded in Public Key history. She is the Deputy District Attorney, Santa Clara County, Office of the DA, who announces her retirement exclusively on the podcast, to pursue her efforts of fighting transnational criminal syndicates facilitating pig butchering scams, with her Crypto Coalition and Operation Shamrock initiatives.

You can listen or subscribe now on Spotify, Apple, or Audible. Keep reading for a full preview of episode 133.

Public Key Episode 133: How Collaboration is Changing the Fight Against Pig Butchering

3 times a charm! This is the 3rd time Erin West (Deputy District Attorney, Santa Clara County, Office of the District Attorney) has appeared on the podcast speaking with Ian Andrews (CMO, Chainalysis) and all 3 episodes have been the most downloaded episodes in Public Key history.

Erin talks about the evolution of combating crypto crimes, from SIM swapping to pig butchering scams. She highlights the growing efforts with the Crypto Coalition and Operation Shamrock and how she will be leaving her position as Deputy District Attorney in Santa Clara to pursue operating Operation Shamrock full time.

She reveals the bottleneck when it comes to combating pig butchering including victim shaming and the transnational organization of criminal syndicates.

She also highlights the need for a unified national strategy against crypto-related scams and increased public private partnerships and collaboration, which in part earned her the Chainalysis Customer Bridge Builder Award and recognition as the ACAMS AFC Professional of the year.

Quote of the episode

“The difference between pig butchering and all the other romance scams is pig butchering doesn’t end until the scammers have taken every last penny.”  – Erin West (Deputy District Attorney, Santa Clara County, Office of the District Attorney)

Minute-by-minute episode breakdown

2 | Erin West’s impactful work in SIM Swapping and Pig Butchering and law enforcement

4 | The global threat of Pig Butchering Scams and transnational organized crime syndicates

6 | Psychological manipulation and its impact on educated and technical professionals

8 | Being named Chainalysis Customer Award winner as Bridge Builder of the Year (2024)

9 | Building bridges in cryptocurrency investigations and global collaboration with REACT Taskforce and Operation Shamrock

13 | Collaborative solutions to combat Pig Butchering scams

17 | The bottleneck of fighting Pig Butchering is handling victims

20 | Erin West retires from Santa Clara DA office to lead Operation Shamrock as nonprofit

23 | House Committee on Financial Services hears about Pig Butchering and crypto scams

26 | OFAC sanctions Cambodian tycoon and businesses linked to Pig Butchering scams

29 | The future of Operation Shamrock and combatting Pig Butchering

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Speakers on today’s episode

  • Ian Andrews *Host* (Chief Marketing Officer, Chainalysis)
  • Erin West (Deputy District Attorney, Santa Clara County, Office of the District Attorney)

This website may contain links to third-party sites that are not under the control of Chainalysis, Inc. or its affiliates (collectively “Chainalysis”). Access to such information does not imply association with, endorsement of, approval of, or recommendation by Chainalysis of the site or its operators, and Chainalysis is not responsible for the products, services, or other content hosted therein.

Our podcasts are for informational purposes only, and are not intended to provide legal, tax, financial, or investment advice. Listeners should consult their own advisors before making these types of decisions. Chainalysis has no responsibility or liability for any decision made or any other acts or omissions in connection with your use of this material.

Chainalysis does not guarantee or warrant the accuracy, completeness, timeliness, suitability or validity of the information in any particular podcast and will not be responsible for any claim attributable to errors, omissions, or other inaccuracies of any part of such material. 

Unless stated otherwise, reference to any specific product or entity does not constitute an endorsement or recommendation by Chainalysis. The views expressed by guests are their own and their appearance on the program does not imply an endorsement of them or any entity they represent. Views and opinions expressed by Chainalysis employees are those of the employees and do not necessarily reflect the views of the company. 

Transcript

 

Ian:

Hey, everyone. Welcome to yet another episode of the Public Key Podcast. This is your host, Ian Andrews. Today, it is my pleasure to welcome my friend Erin West, who is now appearing on her third episode of Public Key. Erin, I feel like we need to establish a tradition like Saturday Night Live where once you reach a certain threshold, you get a special jacket. You’ve exceeded even our CEO, Michael Gronager, who’s only been on the podcast twice, with your third appearance, so welcome to the show.

Erin:

Thank you so much and I will, I’m staying in for the five-time jacket.

Ian:

There we go. All right.

Erin:

I’ll wait it out. Yeah. No, I’ll wait it out.

Ian:

We’ll make it happen. The work you’re doing is so important that I think it drives this conversation so frequently. For new listeners who maybe haven’t gone back in the archives and heard some of our earlier conversations, maybe we can just start with a little bit of your background and how it is that a district attorney from Santa Clara County in California is on a crypto podcast.

Erin:

Sure. I’ve been a prosecutor for 26 years in Santa Clara County, and for the last eight, I’ve been assigned to a high-tech task force. In Santa Clara County, we have a really elite group of detectives who focus on high-tech crime, which right now, generally involves cryptocurrency.

Starting in 2018, we were doing SIM swap cases. That’s a case where a hacker takes over the traffic coming into a phone, then is able to defeat two-factor authentication, and ultimately, the goal is to access your cryptocurrency wallets and steal your money. And that’s where we learned to do cryptocurrency investigations. Chainalysis, we were one of the early adopters and definitely used your tool to track things down.

And then after that, after we prosecuted a big group of SIM swappers, we kind of hit a lull and then the next happened. And that was in March 2022, we started seeing our first pig butchering cases. And for those of you who don’t know, pig butchering, it’s a really massive threat that’s being perpetrated against literally the world. I would love to say the United States, but it’s really any country that has any kind of finances or any country that has humans that can be trafficked into doing the work. Basically, it’s a long con romance/investment scam where the victims are drawn into a relationship that they think is the relationship of their lives. And then based on that trust and seeing that their partner has a really elevated lifestyle, and that partner says, “Oh, yes, I made that money in cryptocurrency,” or whatever investment, lures our victims into making a similar investment, but it’s all fake.

And the difference between pig butchering and all the other romance scams is pig butchering doesn’t end until the scammers have taken every last penny. And that’s why we are finding ourselves in such a disaster of a situation with victims coming to us who’ve lost everything.

Ian:

It really is just heartbreaking to read these victim accounts of the experience that they’ve gone through. The high of finding a new relationship, a friend or a romantic partner that you’ve met online, to the lows of realizing that the entire interaction was fake and likely some substantial portion, if not all of your financial wealth is gone.

We first started talking about pig butchering on this podcast two years ago. I had a guest on, Alastair McCready who, at the time, was a journalist with Vice News covering Southeast Asia. And the thing that he opened my eyes to was that this is not one or two technically enabled criminals on the internet who are perpetrating this scam. It’s really transnational crime organizations operating at unbelievable scale. Maybe unpack some details there for what you’ve found through your work. Who’s on the scamming side of this?

Erin:

Sure. First, I would like to acknowledge Alastair and the work that he did because it was journalists like him and continues to be journalists like him that are really telling this story from the ground floor because these crimes are happening not in places where we have great access. So it’s journalists that are really helping us understand it.

The scammers in these cases are, it’s a completely organized, targeted operation run by Chinese organized crime. And it’s run by traditional Triads, it’s run by syndicates of organized crime members. And we’ve seen that in Cambodia, they reach to the highest levels of government.

We know that the compounds, well, it’s important to understand that the work is being done not in traditional boiler room type situations, but in massive compounds where people are locked down and forced to do this work. They’re staffed by human trafficked victims. So the entire operation is run at scale and has been perfected over years because they’ve seen very little friction from anyone.

So they’ve built these compounds, they’ve built infrastructure, they’ve brought in intelligence to design the tech that is backing this. They’ve brought in experts in psychological manipulation, and that’s why we’re seeing even the smartest and well-educated of us fall victim to it, that we’re just really no match for this criminal enterprise.

Ian:

Well, and this is one of the things that I want to highlight to the listeners is when you first hear about this being described, I’ve seen it happen over and over. The first reaction is, “Oh, that’s terrible. It would never happen to me.” There’s almost this assumption that the victims are elderly or non-technical, not familiar with how to use a computer or an iPhone, or somehow suffering some emotional damage where they just are at risk to fall for this.

And I think none of that is true. When I see the victim accounts, these are people just like you and I, highly educated, technically competent, working professionals in the prime of their careers who are falling victim here. So it could literally happen to anyone, anywhere with any wealth, you’re potentially a target. And I know I get weekly, many texts attempting to initiate one of these scams of engagement. Occasionally, for a while I got into responding to them just to sort of waste their time as a bit of a playful habit. But it is prolific and I think people need to really be on guard for this, unfortunately.

Erin:

I think you’ve pointed out some really important pieces of this, and one of the pieces… Well, first of all, the statistics show, if you look at what has been reported to IC3, the FBI’s online portal for internet crime, what you see is that the highest, the age group hit the worst is 30 to 50. So we really need to start changing the dialogue about what this is because it’s easy to dismiss this when you think this couldn’t happen to me or anyone that I know.

I’ll give you a really perfect example. There was a man in Santa Clara County who attempted suicide. He was a victim and he attempted suicide. I talked to him and he was a member of a pretty elite trade group. I’ll just call it a trade group. And he said, “Could you go educate my group about this? Because if I could fall for this, they could all fall for this.”

So I go and it’s a round table of maybe 25 people, and I start in. And five minutes in, some guy raises his hand and he’s like, “Yeah, I just don’t think this would happen to me. I’m going to dismiss every…” Essentially like, “Thanks, lady, for coming out, but this isn’t going to happen to me.” And in my mind, I’m like, “It happened to one of you. One of you tried to kill himself over this. So yes, it could happen to you.”

But the point you make is valid. I honestly never start, I never have a conversation with a victim where they don’t say to me, “Erin, I need you to know I’m really a smart person.” It’s always important for them to say, “I’m not stupid,” and that’s the point. No, you’re not stupid, but you are no match for a criminal syndicate that has studied how to break you down over time, how to isolate you, how to make you think that they are the only one that could be trusted. Because what they’re asking these victims to do is stuff that we would think we’d never do. We think we would never liquidate my children’s college accounts, but I bet I know someone who did, and I bet that someone looks a lot like me.

So I always say with these cases, we really need to lead with empathy because you don’t know who’s sitting next to you and what they’ve suffered because so many people are suffering this in silence and are too embarrassed to let us know. But I know because I see the reports from doctors and financial industry people and lawyers and professors, FinTech people.

Ian:

It really is, there’s an emotional toll to going through these victim reports. So my advice to everyone is if you encounter an opportunity that seems too good to be true, it is. Stop yourself right there and don’t proceed.

I do want to talk about something positive though. You recently were awarded the Bridge Builder of the Year award at the Chainalysis Trace DC conference, and this was really a recognition for your work both with the Crypto Coalition and the recently formed Operation Shamrock. So I want to give you the opportunity to talk about work in both of those areas. What have you been doing? What are the goals? And most importantly maybe, how can people help?

Erin:

Yeah, thank you. First of all, a really big thanks to Chainalysis for that honor. That was really, I was very touched by that. And actually, the award itself is beautiful. The glass, the way it has the color, oh, it’s beautiful. It’s a favorite.

Why I was really touched by that award in particular is the term bridge builder, because I feel like that is exactly what I do. That is exactly my job description without it being my job description. What we found, what became obvious in the SIM swapping cases and now in these pig butchering cases, and now in these crypto kiosk cases, every swindle involves, these days, putting money into some sort of cryptocurrency opportunity in some way.

But what we found was that local and state government just was not ready for this challenge. Cryptocurrency really took it by surprise, and they weren’t ready for how we’re going to investigate these cases. So as a result, we were watching victims come into local police stations and not be able to get the help that they needed. And more and more of that kept happening, and it, quite frankly, continues to happen. It’s still a major, major problem.

So when I saw that happening and saw that… So my team is a team, REACT Task Force is a specially funded state of California team, so I recognize already that we have the benefit of a mandate and funding. So I thought, “Well, who better than to start educating about how to do this work?” We were lucky because we got the opportunity to learn this and we were able to afford tools like yours, and so we needed to share the wealth.

So I started the Crypto Coalition as a means to figure out who in the US is doing this? And you know my favorites, because they’re on your show and they are at your events. But Alona Katz in Manhattan then, now Brooklyn, was doing great work. And Matt Hogan and Mike Grabowski were doing great work in Connecticut. Jon Scharf was doing great work in Queens. And actually, it was really through my first LINX event that I met a lot of these people and realized, “Hey, we’re doing the same work. We need to team up.”

So we formed this coalition back in October ’22 with 85 people. I did a webinar on pig butchering and said, “Come, if you want to learn about this.” And next thing we knew, we’re up to 2000 people today.

Ian:

It’s incredible.

Erin:

Yeah, and the meat of the Crypto Coalition is such that every single day, there’s probably 15 emails flying back and forth about who’s worked with MEXC? Who knows if Coinme will help me with this. What do we do about, how do I get an MLAT? All of the knowledge, because we have people joining every single day that are like, “Oh, I’m from Tuscaloosa. I’m new to this.” And we can have that person get help from someone like Jake Tuzinski in Brooklyn Park, Minnesota who’s been doing this for two years. So it’s a fantastic match.

And then in addition, we do webinars. So I’m no Ian Andrews, but I do a webinar every month to teach and to keep people up to speed.

Ian:

It’s incredible work and it’s so important. I’ve heard from so many people who participate that it’s become such an indispensable resource. The ability to reach out to somebody in a state outside your jurisdiction, help a victim, get some information, figure out how to interact or find a contact that’s willing to help at an exchange in the ecosystem, I think it’s amazing. And the scale of it blows me away. I remember when it was just a few hundred people on those webinars, so 2,000, bravo. Congratulations, Erin.

Erin:

Thank you, thank you. It’s genuinely one of my proudest accomplishments because it’s an opportunity where I saw a need and people saw the same need. And together, we could fill it, which is great, together.

And the other great piece of it is that, so we just did a back to school sprint and Chainalysis was part of it. You guys taught on it too. I don’t know if you know about this, but we did a two-week sprint where every day at noon Eastern, we did a one-hour webinar. And they were fantastic. We had someone from Binance come and explain how to read Binance records. We had Chain there. And I think Chain’s on today at noon actually too, we’re doing a industry round table, which should be good.

Ian:

Amazing.

Erin:

But the point of what’s so great about it is it took a weight off of REACT. For a long time, we were having people would call us and that just didn’t scale. So now to be able to have resources where there’s a ton of experts that people have access to is amazing.

Ian:

Yeah, it’s great. Now, tell us, how did that, I think led to the creation of Operation Shamrock? What is Shamrock?

Erin:

It did.

Ian:

Where did it come from? And where is it today?

Erin:

Yeah. We started doing conferences in Santa Clara County. So our second year was January of this year, January 2024, and 180 people from the coalition came, which was amazing. They were from a ton of different states, we had three other countries represented. And it was magic to get all of these people in the same room who had been virtually working together for a year.

Working in this really niche part of investigations, I feel like these are my peers. I interact way more with them than I do with other Santa Clara County people because this is so niche and this is what we’re doing. So having everybody in the same room was amazing and positive and inspirational and made me think, “Hey, there’s more that we could do as a group.” And it made me think about this pig butchering situation worldwide and how this is a global threat and it takes more than law enforcement to get this done.

I felt like I had really kind of built a relationship, and I keep saying state and local, but I really want to want to give a shout-out to Secret Service who is an integral part of this, who I swear people say like, “Hey, can someone go interview someone in Wichita?” And its Secret Service is like, “Yep, we got it.” They’re amazing because their footprint is so massive and they’re so cooperative and collaborative, so I really want to give a shout-out to them.

But anyway, we realized, “Okay, I feel like I have a good handle on at least how we could corral law enforcement,” but there is a whole life cycle of pig butchering that needs to be addressed and needs to work in lockstep. And actually, Chainalysis keeps coming up in this story because it was at LINX. It was at LINX 2023 that I launched this whole idea of we’ve got to work together. Everybody in this room has a piece of this, whether you are in banking or regulation or social media.

So what the idea of Shamrock was, let’s round up all these people. We’ve rounded up [inaudible 00:19:07]. Let’s round up everybody involved in pig butchering. And I’m a big proponent of, there are a lot of conferences where we can talk about how bad pig butchering is or how bad whatever the issue is. But Shamrock is meant to be like, “Okay, yes it is, and here’s what we’re doing.”

For example, the law enforcement thing, like, yes, we’ve got a deficit, so we’re going to do a training. We’re going to do a two-week sprint. Banking, your tellers don’t know what’s up, so we are… Our banking group, we did a sprint, a September sprint for banking too, and we taught 220 banks and credit unions what this typology is.

Ian:

Amazing.

Erin:

And we developed a one-pager for tellers and we mashed together our banking group with our victims group, which that’s the beauty of Shamrock is you can cross-pollinate. And when we put banking and victims together and said, “Victims, what could have turned you around at the bank? What could that bank have said to you?” That was fascinating to see that, first of all, what’s not working. What’s not working is victim shaming on a whole level, but particularly in the banking situation where a victim comes in and they say, “Hey, this is a scam. You know this is a scam.” That’s not working.

So what victims said is a softer touch where someone asks about, “Are you investing in cryptocurrency? Tell me about that. How does that work?” Saying things like, “How do you know how to do this? Is someone guiding you?” Because that’s the whole, that’s big butchering is somebody is guiding you how to do this. So if you can somehow break through and actually meet people at the level that they are, that we might have more success. But again, that’s not a cure-all, there’s a million pieces of this, but that’s why Shamrock is essential because everybody needs to be leveraging whatever piece they have.

Ian:

Yeah, it’s such a complex crime because you have people taking money out of their traditional bank accounts at any one of the brand name banks. You have the dating platforms or the social networks where victims are being entrapped by the scammers. And then you have, there’s a number of other players through the system. By the time it gets to law enforcement or your office, it’s often beyond the point of recovery, unfortunately. So if we can get upstream in the system by collaboration, it seems to me like that is the opportunity to really shut this down at scale and limit the victim impact.

Erin:

Yeah, I think that’s the only way to do it, is to start earlier in the process. And also, I’m a big proponent of working with data, that data is going to solve this. And we need a better data solution and we need collaboration and cooperation with data. How are we going to piece all this together?

Ian:

Yeah. Tell us what’s maybe not working. I know we’ve got a lot of people that listen to the podcast that are in law enforcement or in compliance roles across the industry. What is the message to them on where we still need to take action or make effort or get better?

Erin:

For me, one of the biggest pieces that’s not working is the way we’re handling victims at scale. That because there are so many victims, we need a better means of interacting with these victims. Because these are people who have done the right things their whole lives, these are regular taxpaying, raised good kids kind of people who think that when they’ve had their entire life stolen out from under them, that somebody’s going to care about this. That their police are going to care about this and that the FBI’s going to care about this. And what’s happening, in ways that is devastating, is that I’ve got this crazy cat that needs to be right in the middle of everything. But aside from that, what’s happening is they’re getting no help. Goodness sakes. I know, I know. We need to do better with victims. We need to do better with victims.

We also need, we’ve got to do better on the tech side. What I’m seeing, and the thing about Erin West, and I don’t like to talk about myself in the third person, is I’m a truth teller. And the fact is, we have got to do better on the social media side, period. I’m not here to call people out, I’m not here to rant, I’m not here to make enemies, but we’ve got to do better because that is the access of this targeted, state sponsored type activity that is coming for our victims. So we’ve just got to figure out a better way. We have to invest in resources that are going to limit the access of these bad guys to our victims.

So those aren’t working. You know what else isn’t working? There’s a lot of things that could be done better. What’s not working is having a million different things going on that aren’t collaborative. We need a leader, we need a strategy, and we need to execute. And having everybody keep their own piece of it and not collaborate isn’t working when we have a threat this massive. We’re talking about tens of billions of dollars that are being taken from our country to criminals, to bad actors. And then it’s being recycled into our country in ways where they’re buying our real estate, they’re driving up our home prices. That’s what they did in Australia. This is a massive, massive deal that is not some ladies with cats who are sitting home alone who needs some attention. It’s a massive deal.

Ian:

Do you want to take a pause and do something with the cat, by the way? We can click this [inaudible 00:25:30].

Erin:

The cat’s gone now. The cat’s done. The cat’s moved on. Yeah.

Ian:

I have to say your calm under cool there is pretty impressive. I’m not sure that I could have kept talking while trying to swat away the cat-

Erin:

Oh my God, [inaudible 00:25:44].

Ian:

… and kept my thoughts coherent. So another impressive feat.

Erin:

I have a big announcement. Can I tell you the announcement?

Ian:

Yeah. Of course.

Erin:

… that I haven’t pulled publicly?

Ian:

Absolutely.

Erin:

I’m retiring from the district attorney’s office, effective mid-November.

Ian:

Amazing.

Erin:

So that I can focus full-time on Operation Shamrock.

Ian:

That is incredible. Congratulations, Erin. What does that mean? Is that a volunteer position? Are you going to make this a nonprofit organization? What does it look like?

Erin:

I’m going to make it a nonprofit organization, and I am going to be able to focus full-time and to be able to direct this mission in, there are certain government limitations. We all know that when you work in government, there are certain limitations and this will enable me to be able to pursue this in different means that weren’t available to me before. So I’m super excited about it.

I’ve been at the DA’s office 26 years. I have been so lucky that they have let me do this work as a local prosecutor. But the opportunity to really do this work as a non-profit and to really put full effort into it and have some structure to it is amazing and have some… There are a lot of people who are super excited for me and are backing this in great ways, and I’m just really excited about the opportunity.

Ian:

That is amazing news. Thank you for breaking it here on our podcast.

Erin:

Here it is.

Ian:

Congratulations.

Erin:

Here we are.

Ian:

And there you go, for all the listeners, the new executive director of-

Erin:

Sure.

Ian:

… the Shamrock Foundation?

Erin:

Operation Shamrock, or it could be Shamrock Foundation, who knows? We don’t know. We’re not there yet.

Ian:

Okay. All right.

Erin:

We’ll get there.

Ian:

We can test out a couple different variations.

Erin:

Yes.

Ian:

CEO of Operation Shamrock?

Erin:

We’ll shop it around.

Ian:

Yeah, exactly. We’ll workshop it a bit.

Erin:

We will workshop it.

Ian:

That is terrific. Now, even before retiring, you’ve been pretty busy lately. You were in DC recently, my hometown, talking to the House Committee on Financial Services. What was that testimony all about?

Erin:

Well, first of all, what a fantastic opportunity that was. When I started to realize how big this problem was, I had two goals that I wrote on my white board, and my goals were 60 Minutes and Congressional hearing. I was on 60 Minutes Australia last month, and they told a beautiful story. They did it in two segments, and they really told the story beautifully.

And then the reason why I wanted the Congressional hearing is because I have thought for a long time that this problem is so big, it needs to get to the highest levels of government and I’m not sure it’s there yet. I’m not sure everyone understands how bad this is. So I was a member of a senior study group for the United States Institute of Peace where we wrote a really comprehensive paper on how bad this threat is, and that has gotten some interest in Washington. And as a result of that and other things that I’ve done, I was asked to testify, along with Treasury and FinCEN and Secret Service.

And I think I filled a unique place on that panel in that I’m more directly involved with the human piece of this than they are. I think what’s different about me is that I have a good, well-rounded understanding of the situation. I’ve been to Asia twice to study this. I’ve talked to victims, I work with banks. So it gave me an opportunity to talk to Congress about the massive scale of this, and then really helped to redirect their ideas about what this might be, that this isn’t small-time Nigerian fraud that we’re very familiar with, though it’s not even this, we also know Indian call centers, and that’s a big threat as well. But it’s like that, but massively increased from that level.

So it was a great opportunity to educate about that and then also to find that there are some pioneers in Congress who are bringing bills. Congressman Nunn of Iowa is championing a bill that will give greater access to funding for tools and training for local and state law enforcement and tribal. So it was fantastic to see that there are already some allies in Congress for understanding this problem and for doing something about it. And there were new people that I think I was able to open their eyes a little bit to what this threat is.

Ian:

Yeah. And I think it’s so important because people often think about Congress as being the lawmaking body. Oh, we need new legislation. But they also play a really important function of appropriations, and not only for federal agencies like Secret Service and Homeland Security and IRS, who you mentioned, but also state and local agencies all across the country receive federal funding. There’s some big intelligence fusion centers. And making sure that’s directed towards this problem versus any of the other, unfortunately, long list of problems that they could be directed towards, I think is super important to tackle the problem. So congratulations on knocking both the 60 Minutes and the Congressional testimony off your goal board. That’s a major milestone.

Erin:

So new goals.

Ian:

Yeah, exactly.

Erin:

Got to come up with new goals.

Ian:

What’s on top of the board now?

Erin:

Well, I guess the nonprofit, executive director of the nonprofit.

Ian:

There you go.

Erin:

And then I’m not going to stop until there is a unified national strategy. We’ve got to have a national strategy and we can’t keep working in silos. So I’m going to refine my techniques, I’m going to see how to make that happen and I’m going to keep plugging away at that.

Ian:

All right. I can’t wait for that. There has been some good progress internationally, I’m curious to get your take on it. There was a big sanctions package dropped on a Cambodian tycoon. Some of his family members, I think his sons, and related businesses that were, I think operating one of the larger scams at scale internationally. And they had affiliated businesses that were doing money laundering and all sorts of other financial crime activities as well.

What was your reaction when you heard this news? Is this a major moment of progress on this front? Should we expect to see more of this? Is it a drop in the bucket and it’s not really necessarily going to change the impact on the ground for victims? What do you think?

Erin:

It’s all of that. It’s all of that, it’s yes and. So what I will say, number one, is that I work with Jacob Sims [inaudible 00:33:35]. He’s one of the co-founders of Operation Shamrock, and he was really involved in that. He’s a Cambodian country expert. So I give him a lot of props and I give Treasury and OFAC a lot of props.

This is a major deal because it is an acknowledgement by the United States that there is a major problem in Cambodia, in Southeast Asia, that it is being run by organized crime and that corruption goes all the way to the top. We know that Lee Yung Fat is intimately involved with leaders of the Cambodian government. And we also know that we are dealing with a tricky space where this crime, the proceeds of this crime make up half the GDP of Cambodia. So there’s a lot of reason why Cambodians would not want to stop this industry. This is a great industry financially for them.

So what I would say about it is fantastic, so great. We’ve proven we can do this. We know we can do this. Also, my next step is, well, okay, then also let’s indict him because we know how bad he is and we know about the industry that he has created.

And yes, it’s a drop in the bucket, but everything’s a drop in the bucket. When my team was able to recover $210,000 for a victim the first time, that’s a drop in the bucket. Even when DOJ recovers 250 million, that too is a drop in the bucket, but all of these drops together matter. When you put all of it together, that’s how we make progress. So I’m encouraged, I’m hopeful. I want to copy paste and I want to do this again and again, there’s plenty of other names on the list.

But there are plenty of people who think that sanctions is not the way to go here. That’s a whole discussion for another day. But I think that this is, we didn’t overdo it. We picked an appropriate target and made a statement, and so I’m all for it.

I’d love to see more coordinated international efforts in that way. The UK has also sanctioned a number of industry and people in Southeast Asia. I’d love for us to join in those sanctions. I think there’s plenty more opportunity, but this is certainly a great step.

Ian:

Yeah, great summary, and I love the analogy, all the small drops fill up the bucket and we see real progress. The international collaboration actually seems to be working quite well on cybersecurity, right? We’ve seen some major takedowns, even one just in the last week with the Dutch FIAD, the Financial Crimes and Intelligence Group in the Netherlands. UK law enforcement, German intelligence and law enforcement, the BKA collaborating with various parts of the US.

So I feel like there’s a pathway for us to do the same thing related to this crime type, right? Through your efforts and those of others elevating the issue to a similar level that I think we’ve all become aware of things like ransomware and some of the other really nasty state-sponsored hacking activities that are happening in the digital world, bringing this to that level of urgency to take action, we can maybe get some better international collaboration there.

Erin:

It reminds me of the Crypto Coalition, right?

Ian:

Yeah.

Erin:

That there are people that are doing impressive work overseas, and so why not learn from them? Why not team up with them? Why not do it better together? I think there’s a ton of opportunity there.

And I really like what you’re saying about likening this to other places where we have created groups. I reached out to Jackie Burns Koven a while ago about how did you get the White House ransomware group? How did you make that happen? Because that’s the kind of stuff that needs to happen here.

And I think we’re getting there. I feel like there’s momentum. I feel like we keep walking forward, and so I hope we’re well on our way. It’s certainly slow progress, but it’s progress.

Ian:

Amazing. Well, you’re going to have to, I guess, clear some additional space on your awards list. I understand you were in Vegas last week at the ACAMS Conference, which for those who aren’t aware, is a major kind of financial crime and compliance organization, this is their premier conference. And you were named the Anti-Financial Crime Professional of the Year. What’s the feeling getting that award?

Erin:

How crazy is that, right? Right? Who in the world thought that I would win something at an anti-money laundering conference?

But it was a tremendous honor because what it shows me is I’m moving in the right direction. That the work that I’m doing spills over into different parts of this ecosystem, and it shows me that that ecosystem is recognizing that this threat is a major problem. By picking me, they’re saying, “We get it, that’s a big problem. We honor what you’re doing in that space.” So that makes me feel like, wow, there’s a lot of support that could be corralled in that industry. So it was quite an honor.

And I think that on a personal level, I keep feeling amazed at the different pieces of this puzzle that are starting to get it and are starting to think that maybe I know how to put it together, and so it’s a real honor. And I do not take any of it for granted or take… I just really, I see them all, I see these nice awards as like a, “Hey, we’re pushing you forward. Keep doing it. You’re doing the right thing.” So that’s where my head is with that. And I’m really touched, and it was a great event.

Ian:

I would take it as a strong endorsement of all the great work you’re doing and the push on the back to keep going, keep progressing forward.

And on that note, maybe as our closing question here, what should everyone expect from Operation Shamrock over the next 12 months? I know a bunch of my team here at Chainalysis is in the working groups, so I’ve got a little flavor for many of the activities that are underway, but share that with the audience here on the podcast.

Erin:

Yeah, I think that when you have a concept developed by one woman working in a job that’s not quite… I’m working out of my job description, I’m working a little bit out of my lane. I think we made tremendous progress with the infrastructure and what we were able to put together during the initial six months of Shamrock. So yeah, we’re just hitting the six-month mark, so I think what you’re going to see is a better organized…

I think there’s a lot too, just being able to have a website, being able to have places that you can direct people, resources for victims. Here’s what our tech group is doing, here’s what… Transparency. I think you’ll see a lot more transparency. I think you’ll see a lot more structure to what’s happening.

So the first piece will be structure, and the second piece will be action. I think that once we have that structure set up, we will have… The groups are doing amazing things independently, and so there’ll be more cross work of the group and there’ll be more visibility to what’s happening.

I think we’re going to see a real push to get our tellers and wealth managers educated. That is the first line, and that’s where we really need to be. We’re going to see better collaboration with social media and really trying to push them in a way that they can hear it and work with it to do the right thing here. And I think you’re going to see consistent law enforcement capacity building and ability to understand and do this.

So more of the same, but also, really the big picture for me is how do we bring the… What we’ve done for the first six months is really bring a lot of workers together who want to do this, and now I want to start looking at the change makers and how do we get the people who can really make change on a massive level together to say, “Yes, this is a huge national priority and we’re going to fund it and put effort into it”? So that’s what you’re going to see.

Ian:

Can’t wait. So there you have it everyone. Erin West, former deputy district attorney of Santa Clara County, newly minted Financial Crimes Professional of the Year via ACAMS and Bridge Builder of the Year from Chainalysis. And of course, the most importantly, executive director of Operation Shamrock. Erin, thanks so much for spending time with us today.

Erin:

Thank you so much.

 

 

ACAMSBlockchainbridge builderCambodiaChainalysisCrypto InvestigationsCryptocurrencycryptocurrency scamsfinancial crime preventionFraudHuman TraffickingLaosLaw enforcementOperation ShamrockPig butcheringPodcastPublic Keypublic private partnershipsREACT TaskforceRegulationSanctionsScamsSIM SwappingTraceDCvictims