![]() Driscoll of the FBI New York Field Office. “As alleged today, Legkodymov knowingly allowed Bitzlato to become a perceived safe haven for funds used for and resulting from a variety of criminal activities,” said Assistant Director in Charge Michael J. Today’s arrest should serve as a reminder the FBI will impose risk and consequences upon those who engage in these activities.” “We, along with our federal and international partners, will work relentlessly to disrupt and dismantle these types of criminal enterprises. “The FBI will continue to pursue actors who attempt to mask their criminal activity behind keyboards and use means such as cryptocurrency to evade law enforcement,” said Associate Deputy Director Brian Turner of the FBI. Bitzlato also received more than $15 million in ransomware proceeds. and German law enforcement in April 2022. Hydra users exchanged more than $700 million in cryptocurrency with Bitzlato, either directly or through intermediaries, until Hydra was shuttered by U.S. Bitzlato’s largest counterparty in cryptocurrency transactions was Hydra Market (Hydra), an anonymous, illicit 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. The defendant is now paying the price for the malign role that his company played in the cryptocurrency ecosystem.”Īs a result of these deficient know-your-customer (KYC) procedures, Bitzlato allegedly became a haven for criminal proceeds and funds intended for use in criminal activity. “As alleged, Bitzlato sold itself to criminals as a no-questions-asked cryptocurrency exchange, and reaped hundreds of millions of dollars’ worth of deposits as a result. Attorney Breon Peace for the Eastern District of New York. “Institutions that trade in cryptocurrency are not above the law and their owners are not beyond our reach,” said U.S. Bitzlato has marketed itself as requiring minimal identification from its users, specifying that “neither selfies nor passports required.” On occasions when Bitzlato did direct users to submit identifying information, it repeatedly allowed them to provide information belonging to “straw man” registrants. ![]() “The National Cryptocurrency Enforcement Team’s tremendous efforts to disrupt Bitzlato and arrest the defendant demonstrate that we will continue to work with our partners – both foreign and domestic – to combat cryptocurrency-fueled crimes, even if they transcend international borders.”Īccording to court documents, Legkodymov is a senior executive and the majority shareholder of Bitzlato, a Hong Kong-registered cryptocurrency exchange that operates globally. of the Justice Department’s Criminal Division. “As alleged, the defendant helped operate a cryptocurrency exchange that failed to implement required anti-money laundering safeguards and enabled criminals to profit from their wrongdoing, including ransomware and drug trafficking,” said Assistant Attorney General Kenneth A. Today’s actions send the clear message: whether you break our laws from China or Europe – or abuse our financial system from a tropical island – you can expect to answer for your crimes inside a United States courtroom.” “Overnight, the Department worked with key partners here and abroad to disrupt Bitzlato, the China-based money laundering engine that fueled a high-tech axis of cryptocrime, and to arrest its founder, Russian national Anatoly Legkodymov. “Today the Department of Justice dealt a significant blow to the cryptocrime ecosystem,” said Deputy Attorney General Lisa O. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) are taking concurrent enforcement actions. District Court for the Southern District of Florida. regulatory safeguards, including anti-money laundering requirements.Īnatoly Legkodymov, 40, a Russian national who resides in Shenzhen, People’s Republic of China, is scheduled to be arraigned this afternoon in the U.S. ![]() (Bitzlato), was arrested last night in Miami for his alleged operation of a money transmitting business that transported and transmitted illicit funds and that failed to meet U.S. The founder and majority owner of a cryptocurrency exchange, Bitzlato Ltd.
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