Sweden: The Road Toward a Cashless Society

Bitcoin Magazine
Sweden: The Road Toward a Cashless Society

Since October 2014, the Swedish National Bank, also known as Riksbank has cut its interest rates below zero. That means that for well over a year the people of Sweden have been paying the banks to keep their accounts and credit cards accessible.

According to a study published by a group of industrial technologists led by Niklas Arvidsson at the Royal Institute of Technology in Stockholm, banks and economists are pushing a “cashless society” due to the rapid growth of digital transactions, secure online medium of payments and the sudden decay of cash.

Arvidsson and his team of researchers stated that there are around 80 billion Swedish krona in regular circulation (country’s wallets and cash registers), a significant decay of cash since 2009.

“Cash is still an important means of payment in many countries’ markets, but that no longer applies here in Sweden. Our use of cash is small and it’s decreasing rapidly,” said Arvidsson.

Six years ago, the total circulation of cash in the entire country recorded 106 billion krona, around 40 percent to 50 percent more than today’s “regular cash circulation.”

“And out of that amount, only somewhere between 40 and 60 percent is actually in regular circulation,” Arvidsson continued. He further explained that rest of the money is lost in bank deposit boxes or traded in the black markets of Sweden.

As a result, a growing number of economists and banks including the Swedish Central bank are trying to create a completely cash-free society, wherein all transactions and payments are settled digitally, using various means of payments and financial services.

“Walking the streets of Sweden’s second city, Gothenburg, it’s almost impossible to find a shop that doesn’t accept bank cards for payment, and most locals tend to carry no coins or notes on their person. Many also make use of an app called Swish, a collaboration between Swedish and Danish banks that permits fast, simple money transfers on smartphones,” said Duncan Geere of techradar.

Arvidsson also claimed that some bank branches refuse to accept cash and, if they do, the banks require a detailed report of information and evidences that could prove the origin of the cash. For example, if the cash was acquired in a bitcoin exchange by selling small amount of BTC in a series of transactions, customers may have to provide each transaction history and its threads to validate the nature of the transactions.

The majority of well-established financial institutions are worried about involvement in money laundering and fraud, especially for digital currencies like bitcoin which has been involved in various court cases and scams like Josh Garza’s Paycoin and GAW Miners.

“At the offices which do handle banknotes and coins, the customer must explain where the cash comes from, according to the regulations aimed at money laundering and terrorist financing,” explained Arvidsson. Bank staff are required to file police reports in response to suspicious cash transactions.

At this point in time, the central bank and self-titled economists are eagerly searching for alternative payment methods that could potentially replace cash and transform Sweden into a cash-free economy and society.

Recently, Sweden’s largest stock exchange Nasdaq approved XBT Provider AB to launch industry-grade bitcoin tracker on the Nasdaq stock exchange, which is designed to mirror the price of U.S. dollars per bitcoin.

Although the central bank and economists of Sweden are yet to come to a consensus as to which financial instruments and methods of payment could potentially replace the country’s currency, Swedish financial institutions will continue to focus on providing digital products and monetary services to reduce the regular circulation of fiat money.

The post Sweden: The Road Toward a Cashless Society appeared first on Bitcoin Magazine.

The Case Against Carl Force, or Why Prosecutors Seek Seven Years Imprisonment for a Corrupt Silk Road Investigator

Update: Carl Mark Force IV was sentenced to 6.5 years in prison today. While Force’s defense asked for a sentence beneath statutory guidelines as it contended that Force’s behavior was caused by alcoholism and mental health issues, Judge Richard Seeborg is said to have been highly skeptical of this excuse. In addition to the prison sentence, Force will need to pay $340,000 in restitution.

Thanks to Motherboard’s Sarah Jeong (@sarahjeong) for reporting on the scene.

The U.S. District Court for the Northern District of California is set to sentence 46-year-old Silk Road investigator Carl Mark Force IV this Monday.

It seems certain that the corrupt DEA (Drug Enforcement Administration) agent will need to spend time behind bars. After having been arrested in March, he pleaded guilty to money laundering, obstruction of justice and extortion earlier this summer. Last week, prosecutors revealed they seek to lock the former law enforcement officer up for seven years, which they say is the maximum penalty within the applicable sentencing guidelines.

In a 10-page sentencing memorandum, the prosecution explains why only a high-end sentence would be appropriate for Force.

Reason #1: Force betrayed public trust.

The most important reason the prosecutors want to go hard on Force is that they believe the corrupt agent abused the public trust and tarnished the reputation of law enforcement in the process. The memorandum, which opens with a translated Latin maxim (“Corruption of the best is the worst”), argues that Force brutely violated the mandate given to him. A serious crime requiring serious sentencing, the prosecutors contend, not in the least because it reflects bad on all government officials.

According to the prosecution:

In providing the defendant with a gun and a badge, the government entrusted him to act in a manner consistent with standards becoming a sworn law enforcement officer, namely to protect and serve the public. Conduct like Force’s undermines public confidence in law enforcement and threatens the credibility of the entire criminal justice system. Unfortunately, it does not take more than one or two corrupt federal agents to overshadow the consistent and heroic work done by 99.9% of their colleagues. The national media doesn’t publish articles about the agents who are the first responders in active shooter incidents, who risk their lives in undercover capacities, who respond to live hostage situations,who root out financial fraud and uncover terrorist plots – they publish articles about the corrupt behavior of people like Carl Force and [corrupt U.S. Secret Service agent] Shaun Bridges. Simply put, when the badge is tarnished it impacts every single law enforcement officer who wears it and every citizen who relies on it for protection.

Reason #2: Force’s conduct was long-lasting and consistent.

The second reason prosecutors are aiming for a maximum penalty within the applicable sentencing guidelines is that Force’s criminal conduct was not a one-off, but a persistent behavioral pattern. Indeed, the corrupt agent’s story can only be described as a long-lasting, bizarre, and incredible amassment of pathological disregard of the law. It’s not without reason that Twentieth Century Fox recently bought the movie rights to his Silk Road investigation…

According to the sentencing memorandum:

This Court comes across plenty of defendants who have committed a single – yet significant – error in judgment who might deserve a break when it comes time for sentencing. This is not one of those defendants. His crimes do not represent a “one-off” where he experienced a momentary lapse of judgment. Instead, Force committed crimes over the course of many months (if not years) during which he had time to reflect on what he was doing over and over again. Yet instead of ceasing his misconduct after one incident, he continued with impunity until he was caught. His was an extremely calculated effort, designed to avoid detection for as long as possible, ironically using the very skills (e.g. encryption, Tor, etc.) that he learned on the job and on the public’s dime.

Reason #3: Force jeopardized the Silk Road investigation.

The third reason why prosecutors are not going easy on Force is that he greatly jeopardized the Silk Road investigation with his misconduct. Force was part of the Baltimore Silk Road Task Force, which was tasked to uncover the digital black market and arrest its operator Ross Ulbricht, AKA Dread Pirate Roberts. But by breaking all protocol, Force could have ruined a years-long project, spanning four government agencies (the Internal Revenue Service, the United States Postal Inspection Service, Homeland Security Investigations, and his own Drug Enforcement Agency).

Indeed, after the news of Force’s arrest broke, Ulbricht’s lawyer contended that his client was denied a fair trial. Which, by that time, had already ended, of course, with Ulbricht found guilty.

In Force’s sentencing memorandum, the prosecutors write:

Given Force’s role as the undercover agent on that case in communication with Ulbricht, it would have been obvious to Force as a longtime federal agent that he would be a key, if not the key, witness for the government in any future prosecution in Maryland. In stealing money, creating unauthorized personas and having encrypted ultra vires communications, Force acted with reckless disregard for the potential for his actions to jeopardize the very case he was tasked with building. Rather than working to take down the Silk Road – what he was being paid with taxpayer dollars to do – Force lined his own pockets.

Reason #4: A lengthy sentence should serve as a warning to would-be corrupt agents.

The fourth and final reason prosecutors believe Force should be locked up for seven years is that such a sentence would send a signal to his colleagues – both at the DEA and at other government agencies – as well as the public.

The prosecutors contend that Force’s prison sentence should act as a deterrence for would-be corrupt officials. The sentencing memorandum reads:

The Court should send a message that this kind of conduct will be met with a harsh penalty in the form of a high-end prison sentence. A message of leniency communicates to other potentially corrupt government officials that the possibility of prison might be worth the risk in order to profit several hundred thousands or millions of dollars.

And finally, the prosecution believes that a significant prison sentence should show the American public that the criminal justice system works. Not just against criminals among the population, but also against criminals within the government itself.

The prosecution argues:

“At the time of his criminal activity, the defendant’s legitimate work with the DEA was busting drug dealers, arresting them and charging them with drug crimes that carry significant custody time. In the midst of all of this he was stealing money and property from others. In his off-time, he was investing the proceeds of that criminal activity in a business that he worked for on the side, without approval, and striking movie deals and book deals with a Hollywood studio. It is critical that people understand and believe that when a law enforcement agent gets caught doing these kinds of things, he will be dealt with severely by the system of which he was once a part.

Thanks to CoinDesk for publishing the sentencing memorandum.

The post The Case Against Carl Force, or Why Prosecutors Seek Seven Years Imprisonment for a Corrupt Silk Road Investigator appeared first on Bitcoin Magazine.