Chivo Wallet Poses Risks for Users

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By LatAm Reports Staff Writers

After the first conviction for money laundering through the Wallet, LA PRENSA GRÁFICA consulted experts on security gaps in the government’s electronic wallet and how they would allow more uncontrolled criminal acts to be committed.

Carlos Palomo, technician of the Transparency Association, Comptroller of Social Comptroller and Open Data (Tracoda), said that from the Chivo wallet came into operation he had several problems.

Tracoda together with Cristosal reported to the Attorney General’s Office (FGR) that there was an impersonation of identity and lack of controls in this application, but so far there is no progress on a possible investigation.

In the absence of tools to meet your client, eventually people find security holes and take advantage of them to try to launder money. This should help that Regulatory entities of digital and cryptocurrencies adopt money laundering prevention frameworks and stronger and more effective assets,” Palomo said.

It also noted the lack of internal and external oversight, as well as the lack of a system for the prevention of money-laundering and adequate assets. When surveillance fails, the crime eventually tries to permeate and use legitimate services to launder money or assets, finance terrorism, among other crimes, he said.

Ruth Eleonora López, of Cristosal, said that according to the Financial Action Group of Latin America (Gafilat), the system of virtual wallets in El Salvador has been identified as fragile and risky – and that the recent condemnation confirms it.

These cases only confirm what Cristosal denounces and expose how much the Salvadoran system lacks to prevent the laundering of assets, he said.

This article has been translated after appearing in La Prensa Grafica