Organized Crime Exploits AI, Quantum Computing for EU Sanctions Evasion

Europol has released a report detailing how advanced technologies, including artificial intelligence (AI), blockchain, and quantum computing, are being exploited by organized crime networks across the European Union. The report highlights the erosion of trust in the EU’s economy, rule of law, and society due to illicit profits generated by these criminal activities. These activities are not only financial but also support the political objectives of foreign actors, posing additional threats to stability.

Organized crime networks now primarily operate online, using the internet as both a tool and a target for data theft. This shift has eliminated the need for physical presence, making digital crimes more accessible. Criminal groups increasingly rely on AI-driven systems, including large language models (LLMs) and generative AI, to simplify these digital crimes. Generative AI is used to craft multilingual phishing messages, target victims globally, develop advanced malware, and produce child sexual abuse material. Additionally, criminals create realistic synthetic media, such as deepfakes and voice cloning, to carry out fraud, extortion, and identity theft schemes.

Another emerging threat comes from quantum computing. Europol warned that criminal groups have adopted a “store now, decrypt later” strategy, collecting encrypted data with plans to decrypt it once quantum computing capabilities advance. This could potentially compromise sensitive information, posing a significant risk to data security.

Blockchain technology and cryptocurrencies are also being exploited by criminal networks to facilitate payments and launder illicit proceeds. These networks often rely on decentralized systems and unregulated exchanges. Cryptocurrencies are used in a variety of crimes beyond cybercrime, including drug trafficking and migrant smuggling. Activities such as cryptocurrency theft, NFT theft, and cryptojacking have become widespread. Criminals also use privacy coins, chain hopping, and decentralized finance (DeFi) exchanges to launder money. Europol stated that virtual currencies offer borderless, instant transactions when layered with privacy-enhancing technologies, providing a digital shield to conceal laundering activities.

Criminals further leverage cryptocurrencies, DeFi platforms, and AI-driven automation to mask transactions and evade detection. Europol cited the takedown of ChipMixer, an unlicensed cryptocurrency mixer used to launder billions of euros in crypto assets, as a recent example of such activities.

Europol also warned that criminal groups have turned to new technologies to bypass sanctions, particularly amid the war in Ukraine. Networks utilize encrypted communications, anonymized financial transactions, and blockchain to circumvent trade restrictions. The agency mentioned the arrest of individuals involved in exporting military-grade goods to Russia in violation of EU sanctions, showing how sanctions evasion is linked to the proliferation of strategic goods. Europol analysts believe that sophisticated money laundering methods tied to sanctions evasion—often based on complex ownership structures—are expected to become more common. These goods are now increasingly being obtained through intermediary countries acting as transit points, with West and Central Asia playing a key role in this process. Stricter sanctions and growing demand for strategic goods among sanctioned nations have accelerated this trend, according to Europol.