Investigating Crypto Crimes Is a Daunting Task: Israeli Crypto Crime Investigator Amit Levin

Israeli-based blockchain attorney Amit Levin spent more than a decade in the State Attorney's Office in the Ministry of Justice as the Israeli government’s public prosecutor.

In his more than ten years career, he headed the Economics Department of the Cyber Unit, consulted for the Israeli police and tax authorities, interrogated expert witnesses, and prosecuted crypto-related crimes.

Amit recently landed a plum job at Binance as a special crypto crime investigator, and his job description allows him to be part of the Global Sanctions and Counter-Terrorism Financing(CTF) Investigations Team. The following is my recent interview with him. Read on!

Amit, thanks for showing up for this interview. I would like to know more about you.

It's a great pleasure. I am 40 years old. I'm married, and I am the father of four sons. In our house, there are either sports or fights. I started my career as a criminal attorney in the field of sex and drug offenses. Everyone knows it to be an interesting and tough field.

After several years in the field, I felt the need to change and move to the white-collar world, where you usually face more sophisticated defense attorneys with a wealth of experience in criminal litigation.

After about five years in this field, and following my passion for technology, I moved to manage the economic unit in the cyber department at the state attorney's office, which deals with money laundering cases and terrorist financing through virtual currencies.

About a month ago I resigned from my position, and now, I am looking for new challenges.

How did your journey to blockchain technology begin?

This is an excellent question. My journey, like most crypto people, began with a random meeting with a friend who is involved in the field.

I started asking questions, reading material, and listening to podcasts until I finally realized that this is the most fascinating field I have encountered during my career and in which I want to engage.

The Bitcoin white paper is in my eyes a founding document that you cannot understand the crypto ecosystem without reading it several times.

A few years ago, my private interest and my work merged together, and for the past few years, I have been eating, drinking, and breathing crypto in the Cyber ​​Department at the State Attorney's Office

How is cryptocurrency regulated in Israel?

In principle, the direction of the regulators is positive. In November 2022, the Bank of Israel forced all Israeli banks to establish a policy of accepting funds from crypto.

This instruction comes after a substantial ruling by the Supreme Court of Israel that canceled the policy of the banks which excluded the category of receiving funds converted from virtual currencies.

The Israeli Tax Authority also published a number of regulations in the field of crypto including definitions for currency taxation, and even referred to NFT taxation.

The Israeli Financial Intelligence Unit(FIU) is heavily involved in the field and receives suspicious reports, in accordance with the regulation, from providers of financial services in virtual currencies.

How are crypto crimes investigated in Israel?

In Israel, working in a task force is very important. Not all the information and abilities are found in one agency; therefore, teamwork is important.

Oftentimes, the Tax Authority investigators share information that the Israel Police do not have for the purpose of building the investigation case and vice versa.

Just recently, I handled a joint case with a number of investigative agencies which was resolved regarding the statements made by the suspect to customs upon his entry into the territory of the State of Israel.

These statements, which were only in the hands of customs, were passed on to the other investigative agencies and helped a lot in building the investigation case and forfeiture of millions of shekels in virtual benefits.

Do you think cryptocurrency should be banned in Isreal?

Of course not! As I mentioned earlier, cryptocurrency regulation in Israel is in the direction of adopting crypto and not rejecting or outlawing it.

Although crypto poses a very significant challenge to regulators all over the world, it is crucial that it is regulated through existing enforcement tools, and through the development of new mechanisms.

I believe that crypto is here to stay and a country that does not embrace it will eventually be left behind economically and technologically.

What do you consider the most important justification for crypto regulation?

In my opinion, the most important justification for crypto regulation is the need to track questionable funds or money to prevent money laundering. Anyone familiar with the field knows the FATF's efforts in the last thirty years to produce a uniform policy.

This model should also be applied to the crypto world as we recently witnessed in the MICA legislation.

What is the toughest challenge you have dealt with as the head of the economic unit at the Cyber department?

As you can imagine, financial crime in cyberspace is an extremely challenging phenomenon, which is why investigating crypto-related crimes is [important]. There is no case that does not cross borders and contains requests for legal help to different countries in the world.

Some of the countries that do not have diplomatic relations with the State of Israel are naturally bound to hinder the progress of the investigation and make evidence difficult to gather.

The most complex challenges I faced were prosecuting crypto-related cases in courts with no background in money laundering or virtual currencies, and investigating money laundering cases on virtual currencies using various mixers aimed at eliminating the money trail.

How can the crypto industry be regulated without sucking out innovation?

Like most answers in this world, the answer to this is cooperation.

Cooperation between the private sector and the public sector in which each party explains its position and concerns, but on the other hand, persuades the other party to produce a system which, on the one hand, is under regulation, but on the other hand, does not prevent innovation.

In Israel, there are various committees in which representatives from various agencies all aim to bridge these gaps.

Any parting words?

I strongly believe that the future of cryptocurrency is guaranteed in Israel, and I am confident that within a decade or two, much of the global economy will use blockchain technology.