US authorities are pursuing enforcement steps against Bitzlato and its founder. US authorities are pursuing enforcement steps against Bitzlato and its founder.

Must read

The founder of the cryptocurrency company Bitzlato, Anatoly Legkodymov, was detained after the US Department of Justice declared a “significant worldwide cryptocurrency enforcement action” against it.

U.S. Deputy Attorney General Lisa Monaco announced on January 18 that authorities had taken enforcement measures against Bizlato in conjunction with France, seizing the company’s website and designating it as a “major money laundering concern” linked to Russian illicit finance. Monaco claims that in order to prosecute Bitzlato for allegedly “conducting a money transmitting business that transported and transmitted illicit funds and that failed to meet U.S. regulatory safeguards,” the Department of Justice collaborated with the Treasury Department and French law enforcement.

Legkodymov, a Russian national residing in China, was taken into custody by FBI agents in Miami on January 17 as part of the case against Bitzlato. The U.S. District Court for the Southern District of Florida will hold his arraignment.

According to American authorities, the criminal lawsuit against Bitzlato was predicated on the company serving as a “critical financial resource” for the Hydra darknet market, which allowed users to reroute money from various sources, including ransomware attack proceeds:

“Until Hydra Market was shut down by U.S. and German law authorities in April 2022, users of the platform traded more than $700 million in cryptocurrencies using Bitzlato, either directly or through middlemen. Additionally, Bitzlato collected more than $15 million from malware.

The enforcement action was a coordinated effort across Europe and the U.S. to seize many of Bitzlato’s resources — including the firm’s servers — as well as take the founder into custody. Monaco referred to the case as the “most significant enforcement effort” against an exchange since the National Cryptocurrency Enforcement Team was launched in October 2021.

Assistant Attorney General Kenneth Polite of the Department of Justice’s criminal division suggested U.S. authorities were “just getting started” in cracking down on similar firms involved in facilitating money laundering. Though no official directly commented on the ongoing case against crypto exchange FTX and its former CEO Sam Bankman-Fried, Monaco referenced crimes against the U.S. financial system “from a tropical island”.

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Latest article