Roman Sterlingov, founder of Bitcoin Fog, a major crypto-mixing service, has been convicted of money laundering in a United States District Court. 

In a verdict on Tuesday, Roman Sterlingov, 35, was found guilty of multiple charges, including money laundering, money laundering conspiracy, operating an unlicensed money-transmitting business, and violations of the D.C. Money Transmitters Act. 

Throughout the trial, Sterlingov maintained that he was merely a user of the service, not its operator. 

Sterlingov Allegedly Operated Bitcoin Fog Until 2021, According to Reports

According to a press release issued by the US Department of Justice, evidence presented during the trial established that Roman Sterlingov, the founder of Bitcoin Fog, operated the business from October 2011 to April 2021. The service provided a platform for criminals to launder their illicit proceeds, aiming to conceal them from law enforcement.

Over the span of ten years, Bitcoin Fog facilitated the movement of more than 1.2 million Bitcoin, which was valued at approximately $400 million during the time of the transactions. The majority of these funds were found to be connected to darknet marketplaces involved in activities such as narcotics trading, computer fraud abuse, identity theft, and the distribution of child sexual abuse material.

Jim Lee, Chief of the Internal Revenue Service (IRS) Criminal Investigation, stated that the evidence presented during the trial clearly demonstrated that the defendant laundered hundreds of millions of illicit funds from the dark web through Bitcoin Fog in an effort to obfuscate their origin.

In response to the verdict, Sterlingov’s attorney, Tok Ekeland, announced plans to appeal the decision.

Please note that the information provided is based on the press release from the US Department of Justice, and for the most accurate and up-to-date details, it is advisable to consult reliable news sources or official statements from the relevant authorities.

 

In the aftermath of the trial, the jury has ruled for the forfeiture of assets that were seized from Bitcoin Fog. This includes 1,354 BTC held in a Bitcoin Fog wallet and approximately $350,000 worth of various cryptocurrencies held in a seized Kraken account.

The most severe charges brought against Roman Sterlingov, namely money laundering conspiracy and money laundering, carry a maximum prison sentence of 20 years each. The other two charges carry a maximum sentence of five years each.

The sentencing for Sterlingov has been scheduled for July 15, where the court will determine the appropriate penalties for the charges he has been found guilty of.

Please note that the sentencing and related legal proceedings may be subject to updates or changes, and it is advisable to refer to reliable news sources or official statements for the most accurate and current information on this matter.

Tornado Cash Co-Founder to Stand Trial in Pending Legal Case

In a separate case, Roman Storm, a co-founder of the controversial cryptocurrency mixer Tornado Cash, is scheduled to face trial in September.

Storm is facing charges that include conspiracy to commit money laundering, conspiracy to operate an unlicensed money-transmitting business, and conspiracy to violate the International Emergency Economic Powers Act.

Storm has pleaded not guilty to all the charges brought against him.

Having been indicted in August 2023, Storm is currently out on a $2 million bond. He has emphasized the potential implications of the case for Web3 developers and individuals concerned about software and privacy.

Supporters of Tornado Cash argue that the platform merely provides software for decentralized money transmission and does not engage directly in money transmission itself. However, the crackdown on the platform has raised concerns among developers working on privacy-oriented applications, as it is viewed as a potential threat.

It is worth noting that the United States Treasury has added Tornado Cash to its Specially Designated Nationals list, effectively prohibiting Americans from using the mixer. The Department of the Treasury claims that the mixer has been utilized to launder over $7 billion worth of virtual currency since its creation in 2019.

Please be aware that legal proceedings can develop over time, and it is advisable to refer to reliable news sources for the most accurate and up-to-date information on this subject.

By ailf

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