<\/div>\n

Alexander Vinnik, a Russian operator of virtual currency exchange BTC-e pleaded guilty to participating in a money laundering scheme.<\/h2>\n\n\n\n

Alexander Vinnik<\/a>, a Russian national, pleaded guilty to conspiracy to commit money laundering for his involvement in operating the cryptocurrency exchange BTC-e from 2011 to 2017. BTC-e processed over $9 billion in transactions and served over one million users globally, including many in the United States. In July 2017 law enforcement shut down the virtual currency exchange.<\/p>\n\n\n\n

Greek Police\u00a0arrested<\/a>\u00a0the Russian national in 2017, and they accused the man of running the BTC-e Bitcoin exchange to launder billions worth of cryptocurrency.<\/gwmw><\/p>\n\n\n\n

The virtual currency exchange received criminal proceeds from various illegal activities, including computer intrusions, ransomware attacks, identity theft, corruption, and drug distribution. <\/p>\n\n\n\n

Vinnik promoted unlawful activities carried out through BTC-e and was responsible for at least $121 million in losses.<\/p>\n\n\n\n

“BTC-e had no anti-money laundering (AML) and\/or \u201cknow-your-customer\u201d (KYC) processes and policies in place, as federal law also requires. BTC-e collected virtually no customer data at all, which made the exchange attractive to those who desired to conceal criminal proceeds from law enforcement.” reads the press release<\/strong><\/a> published by DoJ. “BTC-e relied on shell companies and affiliate entities that were similarly unregistered with FinCEN and lacked basic anti-money laundering and KYC policies to electronically transfer fiat currency in and out of BTC-e. Vinnik set up numerous such shell companies and financial accounts across the globe to allow BTC-e to conduct its business.”\u00a0<\/em><\/gwmw><\/gwmw><\/p>\n\n\n\n

In July 2018, a Greek lower court\u00a0agreed to\u00a0extradite Vinnik to France\u00a0to face charges of hacking,\u00a0money laundering<\/a>, extortion, and involvement in organized crime.<\/p>\n\n\n\n

French authorities accused Vinnik of defrauding more than 100 people in six French cities between 2016 and 2018.<\/gwmw><\/p>\n\n\n\n

French prosecutors revealed that among the 188 victims of the Vinnik\u2019s attacks, there were local authorities, businesses, and individuals across the world.<\/p>\n\n\n\n

In June, New Zealand police had frozen NZ$140 million (US$90 million) in assets linked to a Russian cyber criminal. New Zealand police had worked closely with the US Internal Revenue Service on the case and the investigation is still ongoing.<\/p>\n\n\n\n

Vinnik denied charges of extortion and money laundering and did not answer magistrates\u2019 questions, his lawyer also announced that is evaluating whether to appeal.<\/p>\n\n\n\n

French prosecutors believe Vinnik was one of the authors of the\u00a0Locky ransomware<\/a>\u00a0that was also employed in attacks on French businesses and organizations between 2016 and 2018.<\/gwmw><\/p>\n\n\n\n

At his trial, Vinnik explained that he was not the kingpin of the organization, he claimed t have served only as a technical operator executing the instructions of BTC-e directors.<\/p>\n\n\n\n

Vinnik was convicted of money laundering but prosecutors didn\u2019t find enough evidence to convict him of extortion.<\/p>\n\n\n\n

\u201cThe court convicted Vinnik of money laundering but didn\u2019t find enough evidence to convict him of extortion, and stopped short of the 10-year jail term and 750,000 euros in fines that prosecutors had requested.\u201d reported<\/a> the Associated Press.<\/em><\/p>\n\n\n\n

\u201cOne of his French lawyers, Ariane Zimra, said his conviction for money laundering \u201cdoesn\u2019t make sense,\u201d arguing that cryptocurrency is not legally considered \u201cmoney.\u201d<\/em><\/p>\n\n\n\n

Subsequently, Vinnik returned to Greece before being extradited to the U.S.. <\/p>\n\n\n\n

\u201cToday\u2019s result shows how the Justice Department, working with international partners, reaches across the globe to combat cryptocrime,\u201d said Deputy Attorney General Lisa Monaco. \u201cThis guilty plea reflects the Department\u2019s ongoing commitment to use all tools to fight money laundering, police crypto markets, and recover restitution for victims.\u201d<\/em><\/p>\n\n\n\n

In February, the U.S.\u00a0charged<\/a>\u00a0Aliaksandr Klimenka, a Belarusian and Cypriot national linked with the cryptocurrency exchange BTC-e<\/a>. The man is facing charges of money laundering conspiracy and operation of an unlicensed money services business.<\/gwmw><\/p>\n\n\n\n

According to the indictment, Klimenka allegedly controlled the platform BTC-e with Alexander Vinnik<\/a> and others. Klimenka also allegedly controlled a technology services company named Soft-FX, and the financial company FX Open. <\/p>\n\n\n\n

The servers that were hosting the BTC-e were maintained in the United States, and according to the DoJ, they were allegedly leased to and maintained by Klimenka and Soft-FX.<\/gwmw><\/gwmw><\/gwmw><\/p>\n\n\n\n

Follow me on Twitter:\u00a0@securityaffairs<\/strong><\/a>\u00a0and\u00a0Facebook<\/strong><\/a>\u00a0and\u00a0Mastodon<\/a><\/p>\n\n\n\n

Pierluigi Paganini<\/strong><\/a><\/p>\n\n\n\n

(<\/strong>SecurityAffairs<\/strong><\/a>\u00a0\u2013<\/strong>\u00a0hacking,\u00a0Alexander Vinnik)<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Alexander Vinnik, a Russian operator of virtual currency exchange BTC-e pleaded guilty to participating in a money laundering scheme. Alexander Vinnik, a Russian national, pleaded guilty to conspiracy to commit money laundering for his involvement in operating the cryptocurrency exchange BTC-e from 2011 to 2017. BTC-e processed over $9 billion in transactions and served over […]<\/p>\n","protected":false},"author":1,"featured_media":76291,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3323,3,55],"tags":[10926,6968,88,4112,9508,9506,10918,687,841,1533],"class_list":["post-162803","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-breaking-news","category-cyber-crime","category-security","tag-alexander-vinnik","tag-btc-e-bitcoin-exchange","tag-cybercrime","tag-hacking","tag-hacking-news","tag-information-security-news","tag-it-information-security","tag-pierluigi-paganini","tag-security-affairs","tag-security-news"],"yoast_head":"\n