Ransomware HQ
Bloomberg Businessweek|November 08, 2021
Moscow’s tallest tower houses multiple companies that experts say are using Bitcoin to launder money
Joshua Brustein

The crown jewel of Moscow’s business district, a 97-story glass tower known alternately as Federation Tower East or Vostok, is a tribute to Russia’s post Soviet economic influence and national strength. Promotional materials for the building, which was the tallest in Europe when it was completed in 2017 and is now No. 2, boast of its highly paid staff and its supposed fortification against “missiles and explosions.” Its apartments are rented and owned by high-ranking government officials and C-suite executives. Residential units sell for upwards of $36 million.

The building has also been home to more than a dozen companies since 2018 that convert cryptocurrencies to cash, judging from the addresses listed on company websites. Although there’s nothing inherently illegal about this, such businesses can enable criminals to cash out profits from digital crimes if they don’t vigilantly monitor their customers, and some find lax oversight to be a useful market niche. Experts have linked at least four of the companies in Vostok to money laundering associated with the ransomware industry, which has generated $1.6 billion in ransom payments since 2011, according to the U.S. Treasury Department.

The perception that the Russian government tolerates, or even encourages, some types of cybercrime has been at the heart of the Biden administration’s conflict with Russian President Vladimir Putin. According to the Treasury Department, this year criminal hackers, mostly based in Russia or Eastern Europe, have made $590 million from ransomware attacks against schools, businesses, government entities, and health-care providers—42% more than they did in all of 2020. At a summit about a month after a Russia-linked cybergang extracted $4.4 million from Colonial Pipeline Co., Biden warned Putin that failure to end these attacks would be met with retaliation. Nevertheless, profit-driven hackers have continued to target U.S.-based networks.

It’s hard to come up with a stronger illustration of the ineffectiveness of Russian enforcement than the existence of multiple entities with links to ransomware operating out of what is perhaps Moscow’s most prestigious office tower. One of the Vostok companies is Suex OTC, the first Russian company to face U.S. sanctions for helping ransomware cartels launder money. Suex, which operates out of Suite Q on the 31st floor, has processed at least $160 million in Bitcoin from illicit and high-risk sources since 2018, according to the blockchain research firm Chainalysis. These transactions account for 40% of the company’s known business.

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