Dr Violeta Zeppa-Priedīte, head of Sorainen Latvia Corporate Crime practice and assistant lawyer Andīna Brīvule
The recent development of various social networks and online platforms has not only created new opportunities for people to consume and publish different types of content, but unfortunately has also opened up new horizons for criminals to engage in illegal activities. As the digital environment evolves, so do the innovative methods used by criminals seeking to launder the proceeds of crime. The forms and methods of money laundering are becoming more varied and, in a sense, more “creative”.
Our attention was caught by details published by foreign media about criminals laundering money through the well-known music streaming platform Spotify.
Violeta Zeppa-Priedīte, head of Sorainen’s Corporate Crime Investigations and Compliance practice and assistant lawyer Andīna Brīvule monitor the latest criminal news on money laundering and other areas of criminal law.
Recently, Swedish media reported that Swedish criminals are using cryptocurrencies to pay for the services of music streaming giant Spotify in order to launder dirty money. Four gang members in Stockholm, as well as an anonymous police investigator, revealed information about the laundering of money linked to violent crimes to a Swedish newspaper. Income earned through drug deals, contract killings, fraud and robbery is concealed through fake music streaming contracts and payments for music published by artists with ties to these criminal groups.
The criminal groups first convert their dirty money into bitcoins (cryptocurrency). They then pay the artists using cryptocurrency, as this is harder to trace than traditional means of payment. Eventually, the artists are paid for their music being streamed and the criminals can collect the laundered money.
One gang member revealed that his gang began using Spotify for money laundering in 2019, around the same time that Swedish gangster rap became popular in the country and started winning music awards. They allegedly paid people, who systematically did it for them.
The anonymous police investigator told a Swedish newspaper that Spotify has become a cash machine for these gangs and that they are linked to deadly violence. On the subject of the risk of money laundering, Spotify argued that only less than 1% of all streams on Spotify have been determined to be fake, adding that any manipulated figures are “promptly mitigated prior to any payouts”.
According to the Swedish newspaper, a million streams in Sweden generate about SEK 40,000–60,000, which is approximately EUR 3,450–5,180. The royalty system used by the music streaming platform Spotify has previously been criticised for allowing users to play it rather than channelling revenue towards real artists. It was recently estimated that 10% of all streams on the platform are generated by automated listeners and that Spotify subscribers can make USD 1,200 (EUR 1,140) a month by listening to their own song on repeat. So far Spotify has rejected these claims.
The articles are available here:
