The US Department of Justice introduced at the moment that it charged two Russian nationals for crimes associated to the 2011 hacking of Mt. Gox, the now-defunct crypto trade that was one of many world’s largest on the time. Alexey Bilyuchenko and Aleksandr Verner are accused in the Southern District of New York (SDNY) of laundering about 647,000 bitcoins related to the heist. In addition, Bilyuchenko faces separate charges in the Northern District of California (NDCA) associated to operating the notorious Russian crypto trade BTC-e.
The pair are being charged in SDNY for conspiracy to commit cash laundering. Meanwhile, the NDCA charges are for conspiracy to commit cash laundering and working an unlicensed cash providers enterprise. The SDNY charges carry a most sentencing of 20 years for every defendant, whereas Bilyuchenko faces a most of 25 years in jail in the NDCA indictment.
The DOJ says Bilyuchenko, Verner and co-conspirators gained entry to the server storing Mt. Gox’s crypto wallets in or about September 2011. Once they infiltrated the servers, the pair and their companions allegedly initiated the switch of consumers’ bitcoins to accounts they managed. In addition, they’re accused of laundering the stolen bitcoins to accounts on different crypto exchanges additionally managed by the group.
The conspirators allegedly negotiated and entered right into a fraudulent “advertising contract” with a New York bitcoin brokerage service, a relationship they used to request common transfers to “various offshore bank accounts, including in the names of shell corporations, controlled by Bilyuchenko, Verner, and their co-conspirators.” The DOJ says the group transferred over $6.6 million from March 2012 to April 2013.
“This announcement marks an important milestone in two major cryptocurrency investigations,” stated US Assistant Attorney General Kenneth A. Polite, Jr. “As alleged in the indictments, starting in 2011, Bilyuchenko and Verner stole a massive amount of cryptocurrency from Mt. Gox, contributing to the exchange’s ultimate insolvency. Armed with the ill-gotten gains from Mt. Gox, Bilyuchenko allegedly went on to help set up the notorious BTC-e virtual currency exchange, which laundered funds for cyber criminals worldwide. These indictments highlight the department’s unwavering commitment to bring to justice bad actors in the cryptocurrency ecosystem and prevent the abuse of the financial system.”
…. to be continued
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