Founder of Bitzlato Cryptocurrency Exchange Pleads Guilty in Money-Laundering Scheme

The Russian founder of the now-defunct Bitzlato cryptocurrency trade has pleaded guilty, nearly 11 months right after he was arrested in Miami earlier this 12 months.

Anatoly Legkodymov (aka Anatolii Legkodymov, Gandalf, and Tolik), according to the U.S. Justice Division, admitted to working an unlicensed cash-transmitting small business that enabled other felony actors to launder their illicit proceeds. He faces up to five several years in prison.

“Legkodymov operated a cryptocurrency exchange that was open for business to cash launderers and other criminals,” reported Performing Assistant Legal professional Standard Nicole M. Argentieri of the Justice Department’s Felony Division.

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“He profited from catering to criminals, and now he should spend the value. Transacting in cryptocurrency does not set you further than the get to of the legislation.”

Bitzlato, which served as a risk-free haven for fraudsters and ransomware crews this sort of as Conti, is estimated to have received $2.5 billion in cryptocurrency involving 2019 and 2023, more than half of which originated from illegal and dangerous sources.

Prior to its takedown by legislation enforcement, the Hong Kong-registered trade also drew awareness for its lax know-your-buyer (KYC) strategies and promoted by itself as a system that demanded only small identifying information from its customers. Some of its end users are considered to have registered accounts working with stolen identification files.

The Justice Section also singled out the Hydra darknet marketplace as Bizlato’s major counterparty in cryptocurrency transactions, with the former’s buyers exchanging no less than $700 million worth of digital property with the trade.

Hydra was the world’s biggest and longest-operating dark web market for narcotics, stolen economic facts, fraudulent identification documents, and dollars laundering services. It was dismantled by German and U.S. authorities in April 2022.

“Legkodymov’s guilty plea now confirms that he was properly knowledgeable that Bitzlato, his cryptocurrency exchange, was staying utilised like an open turnstile by criminals eager to acquire gain of his lax controls in excess of illicit money transactions,” stated U.S. Attorney Breon Peace for the Japanese District of New York.

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Some parts of this article are sourced from:
thehackernews.com