BtC-e largest bitcoin exchange owner Alexander Vinnik indicted for $4 billion money laundering

27 July 2017

The U.S. Department of Justice has sought for an indictment against Alexander Vinnik, a Russian criminal arrested this week in the territory of Greece on 21 counts as he allegedly provided support in laundering over 4 billion US dollars in bitcoin, including those profits generated through the Mt. Gox hacking attack.

Vinnik was operating BtC-e, a bitcoin exchange, which has also been charged with a 110 million US dollars fine by the Financial Crimes Enforcement Network (FinCEN), for violating the anti-money laundering regulations of the United States. After arrest of Vinnik this Tuesday in a small settlement by the Greek police, a grand jury brought an indictment against him and his bitcoin exchange on charges for running an unlicensed money processing business, laundering of illicitly gained proceeds and associated counts.

According to the US authorities BtC-e was one of the largest global digital asset exchanges and it heavily relied on unscrupulous customers helping them to evade taxation and conceal their illegal profits, as it required no verification of their identity, making the transactions as well as sources of money vague and anonymous without proper AML policy at place.

According to the report of the Department of Justice, since its inception six years ago the exchange has processed over 4 billion US dollars in bitcoin, most part of which came from criminal proceeds including hacking, ransomware scam and drug cartels. Meantime, Vinnik was making profits on Mt. Gox hack and processed the funds through BtC-e to launder them and conceal from the authorities.

Apart from the charges brought by the Department of Justice, Vinnik was also fined by the FinCEN with an 11 million US dollars penalty.

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