Crypto Exchange Founder Pleads Guilty to $700,000,000 Unlicensed Money Transmitting Charges: DOJ – The Daily Hodl

Former crypto exchange CEO Anatoly Legkodymov has pleaded guilty to federal charges for his role in illegally transporting and transmitting hundreds of millions of dollars worth of illicit funds.

The U.S. Department of Justice (DOJ) says that Legkodymov, the founder of crypto exchange Bitzlato admitted to operating an unlicensed money-transmitting business at a Brooklyn federal court this week.

The DOJ says that Bitzlato became a haven for criminal proceeds and funds because the firm did not implement proper know-your-customer (KYC) procedures.

The exchange also allegedly facilitated more than $700 million worth of crypto asset transactions with users of the drug bazaar Hydra Market which was shut down in April 2022. 

“Bitzlato’s largest counterparty in cryptocurrency transactions was Hydra Market, an online marketplace for narcotics, stolen financial information, fraudulent identification documents, and money laundering services that was the largest and longest running darknet market in the world.”  

Legkodymov was arrested in January as authorities when US authorities targeted Bitzlato with money laundering charges.

Says U.S. Attorney for the Eastern District of New York Breon Peace,

“Legkodymov’s guilty plea today confirms that he was well aware that Bitzlato, his cryptocurrency exchange, was being used like an open turnstile by criminals eager to take advantage of his lax controls over illicit money transactions. 

The defendant may have thought he was operating from a safe haven overseas for his ‘No Questions Asked’ clearinghouse, but this prosecution and conviction demonstrate otherwise.”

As part of the plea deal, Legkodymov agreed to dissolve Bitzlato and to release any claim over an estimated $23 million worth of the platform’s seized assets.

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• Source: https://dailyhodl.com/2023/12/10/crypto-exchange-founder-pleads-guilty-to-700000000-unlicensed-money-transmitting-charges-doj/