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Trump Administration has filed a lawsuit of $100 million against infamous Bitcoin exchange BTC-e, and its owner, Alexander Vinnik, in a district court in Northern California. The suit has been filed accusing the exchange of providing crypto services to US residents without complying to the laws and regulations laid down by US financial authorities.
For instance, BTC-e failed to register with FinCEN as a monetary services organization, and also failed to incorporate procedures laid down by the Bank Secrecy Act, while also abstaining from reporting suspicious and irregular financial activities. Out of the total $100 million, $88.6 million has been imposed as penalties on the exchange, while the remaining $12 million on its owner, Vinnik, by the FinCEN.
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Vinnik is accused of laundering stolen cryptocurrencies worth billions of dollars. These coins were stolen from various crypto exchanges, including Mt Gox, from which about a mammoth 850,000 Bitcoins were stolen by a hack in 2014.
The complaint further stated,
At no point in time did BTC-e have any AML policies or procedures, let alone an effective program for detecting and preventing suspicious transactions. To the contrary, BTC-e’s lax policies encouraged persons engaged in criminal activity to use its services, and BTC-e became the virtual currency exchange of choice for criminals looking to launder their illegal proceeds.
Vinnik was arrested in 2017, in Greece, where he continues to be in prison. Several countries, including the United States, are making efforts for his extradition, while he wants to be extradited to his home country, Russia. Though he faces charges in Russia too, those are quite negligible as compared to his over 24 criminal cases filed in the US.
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Donald Trump, the US President, tweeted earlier this month that he isn’t a big fan of crypto, and thinks that digital currencies are a tool of illegal activities like drug trafficking and money laundering. With the Senate and Congress, both making statements against crypto, the government is likely to further tighten its grip on the crypto industry in the US.
