Prosecutors with the United States Department of Justice (DoJ) have filed charges against the co-founders of Samourai Wallet, a popular crypto-mixing service.
The Charges Against Samourai Wallet Founders
According to Prosecutors, CEO Keonne Rodriguez and CTO William Lonergan were slammed with charges of operating an unlawful money-transmitting business. The charges noted that the Samourai Wallet was utilized in processing up to $2 billion while in active operations.
The major exception Prosecutors have against the platform involves its use as a conduit for hackers on Silk Road and other dark web marketplaces.
“Rodriguez and Hill allegedly knowingly facilitated the laundering of over $100 million of criminal proceeds from the Silk Road, Hydra Market, and a host of other computer hacking and fraud campaigns,” said U.S. Attorney Damian Williams, “Together with our law enforcement partners, we will continue to relentlessly pursue and dismantle criminal organizations that use cryptocurrency to hide illicit conduct.”
The two named executives have been arrested with Rodriguez nabbed in the United States while Hill was apprehended in Portugal. The two countries are poised to begin discussing extradition options.
As one of the immediate moves against the operations of the illegal Samourai Wallet, the Prosecutors have seized the domain and web application powering the outfit. This means its availability on key venues like Google Play Store.
Dicey Justice System In Crypto
Despite the relatively young age of the crypto industry, a series of scandals have been recorded. The Department of Justice and the United States Securities and Exchange Commission (SEC) have been quite active in bringing many of these criminals to book.
One of the high profile cases thus far this year involves the 25-year sentencing of Sam Bankman-Fried (SBF), the co-founder and former CEO of FTX Derivatives Exchange. The exchange filed for bankruptcy in November 2022 after reports of huge funds missing on its balance sheet.
It was later discovered that SBF misappropriated users’ funds, thus earning him the capital jail term. While this case and the preceding trial was straightforward, the new fraud emanating from the space remains dicey with no precedence to match.
