Bitzlato Founder Sentenced In Fraud Case, But There’s a Twist

Bitzlato, a cryptocurrency exchange owned by a Russian entrepreneur, Anatoly Legkodymov was arrested in Miami earlier this week. He was charged with allowing bad actors to run money laundering operations and illicit activities on his trading platform. 

Bitzlato Is a Front for Fraudsters 

According to a Bloomberg report, Legkodymov was brought to his knees in the U.S. District Court in New York earlier this week.

Eric Vitaliano, the judge presiding over the case said that the exchange is rife with bad actors that intend on using the platform to carry out age-old crimes. The Russian boss was arraigned in the Federal court for allegedly operating a money transfer business unapproved by the United States. Also, his business operators were not aligned with the U.S. regulatory standards, such as anti-money laundering rules. 

Before now, the defendant was imprisoned in January 2023, making it 18 months in the Brooklyn, New York prison. He admitted to knowing that his platform was utilized by the notorious drug bazaar Hydra Market that was busted in 2022. Also, it was used as a front for transactions associated with the dark web. Furthermore, he concealed the profits from illicit gambling and drug transactions worth over $700 million.

Legkodymov Appeal for Compassion

During the hearing, U.S. Attorney Breon Peace emphasized that Bitzlato marketed itself to criminals as a crypto exchange with lax scrutiny, profiting from substantial deposits.

He added that the defendant should be sentenced to a minimum of 4 years imprisonment as a consequence for the detrimental impact his company had caused in the digital world. In contrast, Judge Vitaliano applauded him for leading a commendable life before his arrest. The defendant pleaded with the court to temper justice with mercy in the ruling because of his dangerous prison facility. 

He also agreed to give up his claim to $23 million in digital assets seized by French authorities. Following the conviction, the Bitzlato founder bagged 18 months in jail that he had already served per the Bloomberg report. This news aligned with the arrest of the defunct FTX founder, the lawsuit against Samourai wallet founders and the Binance ex-CEO prison sentence. 

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