Crypto Exchange Founder Arrested for Facilitating Money Laundering

• The US Department of Justice announced an international cryptocurrency enforcement action on Wednesday and revealed that the DOJ has detained Anatoly Legkodymov, the founder of BitZlato, a Chinese cryptocurrency exchange.
• The US sanctions framework is managed by OFAC and FinCEN are keeping an eye out for suspicious behavior among financial institutions.
• BitZlato traded more than $700 million in cryptocurrencies with Hydra Market, the largest darknet market in the world before it was shut down in April 2022.

On Wednesday, the US Department of Justice (DOJ) announced an international cryptocurrency enforcement action and revealed that the DOJ had detained Anatoly Legkodymov, the founder of BitZlato, a Chinese cryptocurrency exchange. The US sanctions framework is managed by the Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) is keeping an eye out for questionable activity among financial institutions.

Russian citizen Anatoly Legkodymov, 40, of Shenzhen, China, was detained overnight in Miami and was scheduled to appear in court the next day, according to the DOJ. FinCEN has issued an order barring certain fund transmittals involving Bitzlato by any covered financial institution.

The DOJ also stated that BitZlato had traded more than $700 million in cryptocurrencies with Hydra Market, the largest darknet market in the world before it was shut down in April 2022. Additionally, the DOJ revealed that Bitzlato had received more than $15 million in fees for providing services to financial offenders.

In a statement, the US Attorney for the Southern District of New York, Audrey Strauss said, “To anyone who still believes that they can hide from the law by using cryptocurrency, this prosecution should put that illusion to rest.”

The DOJ has made it clear that they are committed to combating financial crimes and they will continue to use all available means to ensure that financial offenders are brought to justice. The DOJ also warned that anyone attempting to use cryptocurrency to launder money could face serious legal consequences.

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