Men charged by U.S. with laundering more than $1B in cryptocurrency
washingtonpost.com
washingtonpost.com
The police employed by authoritarian countries? Yes, though I don’t think corrupt officials should take bribes.
The judges employed by those countries who recognize necessity as an excuse for what is otherwise a crime? Yes, though now the law seems less authoritarian.
INTERPOL? Depends on the law.
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How does this relate to the topic a hand?
Like should they be allowed (i.e., have a possibility) to financially support opposition, journalists, etc.? Should the persecuted minorities (LGBT, etc) be able to hide their actions that may reveal them? Or should they be able to leave the country without revealing such plans to authorities in advance? And so on.
It's relevant because a privacy in finance (i.e., "breaking the laws") is important for those people. So I'm curious what the KidComputer thinks about this.
If this was simple service for moving/spending money privately. Sure, probably nothing wrong then. But the indictment specifically states that they knew the service was being using by sanctioned entities and didn't try to prevent it. That's makes a big difference.
As an example, since now it's under US agencies control and they know that sanctioned entities are using it, why they still don't try to prevent it? Are they supporting NK?
As a counter example, should the US government not try to stop the cartels from using Swiss banks for money laundering because some arbitrary contract was already in effect?
In other words: Monero might be getting some friends on the Fed's crypto blacklist over this case.
Regarding "profiting", it is a good question, and that's what I don't understand in this case. To my understanding there is no direct fees in Tornado Cash. But there are Relays, which, to my understanding, allow to withdraw to a fresh address and take a small fee for that. Anyone can run a Relay, and the use is optional. I think those guys were running one of them too.
A Relay doesn't know who is who and cannot limit withdrawals of money deposited by a sanctioned entity. But as they were told that some of transactions are likely illicit, even though they don't know which particular, they knowingly profiting off it in general. That's very broad and later can be applied to anyone.
Similar can be applied to mining. In general ETH, miners do know the addresses and they do not accept transactions that include sanctioned addresses. So they are fine. But for Monero example, it's the same problem. Even though they don't know the transactions participants, they may make profits off illegal transactions.
There's no legitimate reason for those to exist. Or this.
No they wouldn't, how naive are you? they'd get fined a small fraction of the amounts they likely earned for the crime. [1,2,3] + 10 others from one bing search.
[1]https://www.theguardian.com/world/2012/jul/21/drug-cartels-b...
[2]https://www.theguardian.com/world/2011/apr/03/us-bank-mexico...
[3]https://money.cnn.com/2018/02/08/news/rabobank-mexico-drug-m...
If you start a company and take investment and rake in money without AML controls then you're going to have a bad time.
Don't want to be arrested? Pretty simple: Either live in Russia or don't start a company to make money off of money laundering. Or just build the open-source software without trying to make money off of it.
Funny because real estate agencies across the western world rake it in without fear.
At one point, when the founders suggested they create a version of the service that would adhere to federal anti-money-laundering and know-your-customer rules, the investors at the venture capital fund “dismissed the idea,” the indictment says. One of them allegedly wrote “it would be unlikely that as a fund we’d use a ‘compliant mixer.’”
The number of people who would pay to have their money anonymized for purely legal reasons isn't zero, but it seems less likely to be a going concern.
Crypto coin laundries.
Hard to have any positive viewpoint on these guys if this turns out to be true.
it's more likely LG simply used Tornado Cash just like any other user.
[0]: https://news.ycombinator.com/item?id=37240901 [1]: https://news.ycombinator.com/item?id=37242043 [2]: https://news.ycombinator.com/item?id=37247966 [3]: https://news.ycombinator.com/item?id=37253522
Honestly that would not have caused me to read the article. I clicked because I didn't really know what laundering cryptocurrency itself would involve, except a "washing machine" site (which is of course this is). I was hoping to learn something new.
The way to win with a washing machine is to run one, and then when the volume gets high enough just take all the crypto for yourself -- by definition you'd be untraceable, just as your customers wanted.
The investment being referred to seems to have been into the "Peppersec Inc" entity.
They're anonymized this way in the indictment and online listings don't seem to list this mystery funder.
No, crypto is pseudonymous, not anonymous. The whole point of cryptos that aren't monero is that every transaction ever is visible to everyone all the time. That's the point. Not one central person keeping the ledger of transactions, but everyone so everyone can verify. So no, explicitly the entire system relies on absolute traceability for every dollar in the system, from provenance as a mining reward to its current owner.
There are ways to maintain anonymity in this environment, zero knowledge maths, mixers like tornado cash, but as far as basic systems, the absolute opposite is true.
At all times relevant to this Indictment, ROMAN STORM, the defendant, was a naturalized United States citizen who resided in the United States