U.S Authorities Arrested Founder Of Crypto Exchange

US authorities have charged the Russian founder of the Hong Kong-based cryptocurrency exchange Bitzlato, which they say was used to wash hundreds of millions of dollars in criminal money from the dark web.

Anatoly Legkodymov, who lives in China, is the majority owner of Bitzlato. On Tuesday, the FBI arrested him in Miami on charges that he ran a “high-tech financial hub that, in his own words, catered to known crooks.”

The US Justice Department says that Bitzlato handled more than $700 million in illegal funds from drug deals, gambling, and ransomware attacks.

Along with a few European allies, the US has taken action to seize Bitzlato’s servers and cryptocurrency, effectively shutting down the exchange.

Overnight, the Department worked with important partners here and abroad to dismantle Bitzlato, the China-based money laundering engine that powered a high-tech axis of crypto crime, and to arrest its founder, Russian citizen Anatoly Legkodymov, says Deputy Attorney General Lisa O Monaco.

“Today’s actions send the clear message: whether you break our laws from China or Europe – or abuse our financial system from a tropical island – you can expect to answer for your crimes inside a United States courtroom.”

Legkodymov is accused of running a money transfer business without a license. If he is found guilty, he could go to prison for up to five years.

In the meantime, the US Treasury’s Financial Crimes Enforcement Network (FinCEN) has officially named Bitzlato a “primary money laundering concern” in connection with Russian illegal finance, tying the move to Russia’s invasion of Ukraine.

Deputy Secretary of the Treasury Wally Adeyemo says:

“At a time when Russia is waging a brutal and unjust war in Ukraine, and as it seeks to circumvent sanctions and governance controls to fill its coffers and sustain its violence, we have no tolerance for criminal enterprises enriching Russia’s malicious interests.”