Spanish authorities, supported by Europol, recently dismantled a significant money laundering network operating across Spain, Belgium, and Austria. Known as Operation “Karasu,” named after a Turkish river, the operation culminated in the arrest of seventeen individuals of predominantly Chinese and Syrian nationalities.
According to the Spanish National Police, the extensive investigation began with the initial disruption of a migrant trafficking ring, primarily transporting Syrian nationals from Algeria to Spain. The subsequent financial probe uncovered two distinct but interconnected criminal cells—one Arab and one Chinese—working collaboratively through the informal financial transfer method called “hawala.”
Chief Police Inspector Encarna Ortega revealed during a Madrid press briefing that the key orchestrator behind this sophisticated laundering operation was a Jordanian-Palestinian national residing in Belgium. Despite his distant location, he coordinated activities effectively by connecting facilitators in Spain.
Between June 2022 and September 2024, this illicit network managed to launder approximately $21 million, sourced mainly from human trafficking and drug trade revenues. Inspector Ortega highlighted the extensive reach of this network, underscoring its substantial threat to European financial systems and broader security concerns.
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Understanding Hawala: A Popular yet Risky Method
“Hawala” is an ancient, informal system used predominantly in the Middle East, Africa, and Asia for transferring money across borders. Its attractiveness stems from simplicity, low transaction fees, and minimal bureaucratic oversight. However, due to these very characteristics, it has increasingly become a preferred method for criminal organizations to launder illicit proceeds, avoid scrutiny, and finance terrorism.
This method relies heavily on trust among intermediaries known as “hawaladars,” who facilitate money transfers without physically moving currency across borders. Such informal arrangements complicate regulatory oversight, making them difficult for law enforcement to detect and disrupt.
According to Inspector Ortega, hawala’s informality allowed this criminal network to conduct extensive operations undetected for an extended period, leveraging cryptocurrencies to obscure financial trails further.
Seizures Reflect the Scale of Illegal Operations
The dismantling of this network resulted in substantial seizures, reflecting the scale and profitability of the illegal activities. Police confiscated significant assets including €205,000 in cash ($230,000), over €183,000 worth of cryptocurrencies, and eighteen vehicles. Additionally, authorities secured real estate properties and a significant quantity of contraband cigars valued at more than €600,000.
Inspector Ortega explained that the seized contraband cigars were destined primarily for the Chinese market, indicating the extensive international connections maintained by this network.
This seizure underscores the complex, multinational nature of modern criminal enterprises, revealing how illegal networks can diversify their operations into legitimate markets to further disguise illicit earnings.
Combating Financial Crimes Through International Cooperation
This operation highlights the critical role of international collaboration in addressing financial crimes linked to migrant smuggling and drug trafficking. Europol’s involvement was pivotal in coordinating cross-border actions and intelligence sharing among Spain, Austria, and Belgium.
European law enforcement agencies have increasingly prioritized tackling money laundering networks, recognizing their intrinsic links to broader criminal activities including terrorism financing. Inspector Ortega emphasized the significance of cross-border partnerships, stressing that such collaboration is essential in dismantling complex criminal networks.
The European Union has been actively strengthening its legislative and enforcement frameworks against money laundering and terrorist financing. Regulations such as the EU’s 6th Anti-Money Laundering Directive (6AMLD) aim to harmonize legal standards across member states and bolster investigative cooperation, making operations like Karasu more effective and frequent.
Conclusion: A Strategic Win Against Global Money Laundering
Operation Karasu represents a significant victory for Spanish and European law enforcement, showcasing their enhanced capabilities in addressing sophisticated money laundering schemes. However, authorities remain vigilant, recognizing that such criminal networks continuously evolve and adopt new methods.
As Inspector Ortega highlighted, dismantling this network is crucial, but it represents only one step in a broader ongoing battle. “This investigation demonstrates our commitment and effectiveness,” Ortega noted. “But we must remain vigilant as criminals are always adapting.”
Related Links
- Europol Official Announcement on Operation Karasu
- European Union 6th Anti-Money Laundering Directive (6AMLD)
- Anti-money Laundering: Spain – Global Investigations Review
- Financial Action Task Force Guidelines on Hawala Transactions
Other FinCrime Central News About Criminal Networks Using Hawala
- Hawala Banker Arrested for Terrorism Financing and Sanctions Violations
- US Crackdown on Hamas Virtual Currency Reveals Turkey’s Role in Terrorism Financing
Source: AFP via Barron’s
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