The US authorities today announced the arrest of a Russian man, the founder of the Hong Kong-based cryptocurrency platform Bitzlato, who is accused of laundering $700 million in criminal proceeds.
Anatoly Legodimov, 40, a permanent resident of China, was arrested Tuesday night into Wednesday in Miami, Florida, as part of an international operation involving French agents. He is expected to be arraigned before a federal judge within the day and charged with ‘unauthorised transfer of funds’.
“Today, the Ministry of Justice is delivering a hard blow to the cryptocriminal ecosystem” and “responding to the crisis of confidence in the cryptocurrency markets”, commented Deputy Minister of State Liza Monaco at a press conference.
“Whether you break the law in China, or in Europe, or exploit our financial system from some tropical island, you will answer to an American court,” she added, referring to the recent arrest, in the Bahamas, of Sam Bankman-Fried, the founder of cryptocurrency exchange FTX, who is accused of fraud.
In this new case, the US Justice Department accuses Anatoly Legodimov of adopting a “minimal identification” policy for his customers and bragging that he asked for “neither a selfie nor a passport” to use his services. As a result, Bitzlato was turned into a “safe haven for criminal resources”.
The company allegedly conducted almost all of its transactions through Hydra Market, a Russian-language dark web platform that was dismantled last April in a joint operation by US and German authorities, as it was seen as the largest source of illegal cryptocurrency laundering.
Hydra Market, which had been operating since 2015, also sold drugs and fake documents. According to the US Department of Justice, Hydra users exchanged more than $700 million in cryptocurrencies through Bitzlato.
According to the indictment, Anatoly Legodimov knew that his clients were using fake identities to commit illegal acts. In a message he even admitted that they were “scammers”.