The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has proposed a new rule targeting the Cambodian conglomerate Huione Group, labeling it a “primary money laundering concern.” If adopted, the rule would effectively sever Huione Group’s access to the U.S. financial system, significantly hindering its ability to conduct operations connected to illicit activities.

Huione Group’s Alleged Role in Money Laundering

According to FinCEN’s announcement on May 1, the proposed regulation would bar U.S. financial institutions from opening or maintaining any correspondent or payable-through accounts for Huione Group. While the company does not directly bank in the United States, it reportedly operates through overseas firms that do, granting it indirect access to the American banking network.

Authorities allege that this access has enabled Huione Group to support major cybercriminal operations, including laundering stolen cryptocurrency for North Korea’s infamous Lazarus Group. The conglomerate is said to have facilitated the transfer of at least $4 billion in illicit funds between August 2021 and January 2025, much of which is tied to online scams like “pig butchering.”

Huione’s Expansive Network

Huione Group has reportedly built a vast network of businesses to support its operations. These include:

  • Huione Pay: A payment services firm.
  • Huione Crypto: A virtual asset platform.
  • Haowang Guarantee: A recently rebranded Telegram-based marketplace offering various illicit services.

FinCEN also flagged Huione’s stablecoin, USDH, as a potential tool for money laundering. Pegged to the U.S. dollar, USDH is designed to be difficult to freeze, which raises concerns among regulators. Officials believe the stablecoin is being used to bypass oversight and covertly convert illicit funds into fiat currency.

“Because Huione Group claims that USDH cannot be frozen, this service offers a virtually risk-free ecosystem for clients to move or store virtual currencies without the risk of interception,” FinCEN stated in its submission.

Regulatory Actions and Public Comments

The proposed rule is currently open for public comment for 30 days before it can take effect. If implemented, it would disrupt Huione Group’s operations by cutting off its access to U.S. correspondent banking services, a critical component of global financial transactions.

Past Actions Against Huione Group

In July 2024, blockchain analytics firm Elliptic raised alarms about Huione, describing it as a central hub for Southeast Asian cybercriminals. The report highlighted its Telegram-based marketplace, which offered services ranging from money laundering and scam website tools to more serious allegations like human trafficking.

Following these revelations, Tether froze nearly $30 million in USDT linked to Huione accounts. This action may have prompted the company to launch its stablecoin, USDH, as a workaround to maintain its operations.

In January, Huione’s mobile app was delisted from the Google Play Store after mounting criminal allegations. However, the app remains available on the Apple App Store, raising further concerns about its ongoing activities.

Key Takeaways

The Treasury’s move to label Huione Group as a significant money laundering concern underscores the growing scrutiny on conglomerates with alleged ties to illicit activities. By targeting its financial network, FinCEN aims to curb the group’s ability to facilitate cybercrime and financial fraud.

As the cryptocurrency landscape continues to evolve, regulatory measures like these highlight the importance of compliance and vigilance in the digital asset space.

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