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Bitfinex, a leading cryptocurrency exchange serving millions of customers globally, processes a high volume of law enforcement data requests while maintaining strict regulatory compliance across jurisdictions. For their Head of Anti-Money Laundering (AML) Shann Lu, protecting those customers and the platform from bad actors is a critical priority.
A growing security concern for cryptocurrency exchanges is the impersonation of government officials attempting to gain unauthorized access to customer data through fake law enforcement requests.
The Challenge
Email-based processes and fragmented data create operational burdens and security risks
Bitfinex faced significant obstacles in managing law enforcement requests and extracting meaningful insights from their data. The team struggled with a fragmented, manual review process that was becoming increasingly unsustainable. Each request required extensive verification across different time zones and languages, creating a significant operational burden.
Team members had to manually check agent credentials, cross-reference jurisdictional requirements, and maintain detailed documentation of all communications. Request data lived primarily in emails, making it challenging to extract meaningful data and impossible to spot trends and patterns holistically.
This email-based approach created several critical challenges:
- One-off correspondence made it impossible to see trends or connect dots between related requests to profile accounts or identify patterns of suspicious behavior
- Difficulty verifying and communicating with law enforcement agents across global jurisdictions and in foreign languages and time zones created stress and operational burden for the team
- Difficulty sharing information effectively when multiple law enforcement agencies were investigating related accounts
- Limited ability to generate insights about emerging criminal trends or risky behaviors
- No standardized and secure process for tracking and documenting all communications with agents
Manual, email-based processes not only stretched resources thin but also created security vulnerabilities. Without a standardized system, the team faced pressure to protect against impersonation attempts while ensuring legitimate requests were processed efficiently. GDPR compliance added another layer of complexity, requiring careful handling of requests from non-compliant jurisdictions.
Finding a Solution
Kodex doesn’t just streamline operations, but also unlocks request data to enable strategic insights and find bad actors
After thorough security and compatibility reviews, Bitfinex implemented Kodex to automate and secure their law enforcement response process. "Kodex solves 99% of our pain points in handling law enforcement requests," says Lu. The platform's automated agent verification, secure case management, and comprehensive communication tracking have transformed how Bitfinex handles sensitive data requests.
But the solution transformed not just Bitfinex’s operational efficiency, but also their entire approach to investigations and risk management. By centralizing all correspondence data, Bitfinex gained powerful new capabilities for investigations and risk management:
- Customizable intake forms allow the team to automatically extract the metadata they need to profile high-risk accounts; report out strategic insights on request volumes, and crime trends; and conduct analyses to understand emerging crime types or suspicious behaviors
- The ability to connect related requests helps coordinate investigations when multiple agencies are involved
- Agent verification prevents law enforcement impersonators from compromising Bitfinex’s user data
- Case assignment, automated workflows, and investigation tracking makes it easier and safer to intake and efficiently respond to requests across the globe
- Single secure place for all internal and external data correspondence ensures all communications are organized in one place
"Having all our data in one place has revolutionized our investigative capabilities," Lu explains. "We can now identify behavioral patterns associated with high-risk accounts, even without traditional banking data points like shopping habits or mortgage information. This strategic intelligence helps us protect our platform more effectively."
The psychological impact on the team has also been remarkable. "No more early morning calls across time zones, no more stress about deadlines, and a renewed confidence in our ability to identify legitimate requests," notes Lu.
Looking Ahead
Leading the charge: how Bitfinex is helping to build a stronger crypto ecosystem, one data request at a time
Through this implementation, Bitfinex has strengthened its position as a trusted partner to law enforcement while maintaining robust user protection. For leaders like Lu, it's about more than just processing requests—it's about leveraging data strategically to bridge the gap between cryptocurrency innovation and regulatory compliance. By identifying patterns, coordinating investigations, and removing bad actors, Bitfinex is helping create a safer digital financial ecosystem for everyone.
"The ability to connect the dots between requests and extract meaningful insights has transformed how we approach platform security," Lu concludes. "When we can efficiently cooperate with law enforcement and proactively identify risky behavior patterns, we raise the barriers for illicit activity across the entire crypto ecosystem."
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