DOJ Resists Dismissal of Charges Against Tornado Cash Co-founder in Crypto-Mixer Crackdown
Summary:
The U.S. Department of Justice (DOJ) has rejected a request to dismiss charges against Roman Semenov, the co-founder of Tornado Cash, a crypto-mixer service. This comes as U.S. authorities intensify their crackdown on crypto-mixing services. The DOJ accuses Semenov and Roman Storm of operating an unregulated money-broadcasting station, violating sanctions, and conspiring to facilitate money laundering. Despite their attorneys attempting to nullify the allegations, the prosecutors maintain that they should be held responsible for facilitating criminal activities.
The U.S. Department of Justice (DOJ) has challenged a request to throw out charges of conspiracy and money laundering levelled against Roman Semenov, the co-founder of Tornado Cash. The DOJ alleges that the defense's motion contended disputable facts that require jury examination, making it ill-suited for initial motions of dismissal. Additionally, the DOJ scrutinized the defense's perception of Tornado Cash, stating that creation of the crypto-mixing service in 2019 functioned as a mixer composed of a website, an interface for users, a series of smart contracts, and a relay network.
The justice department is accusing Semenov and co-developer Roman Storm of the creation and operation of Tornado Cash, arguing that this service acted as an unregulated money transmittal station, infringed upon sanctions, and conspired to facilitate money laundering. Organizations such as North Korea's Lazarus Group have reportedly leveraged Tornado Cash for their fund laundering activities.
In the latter part of September 2023, after his arrest, Storm denied all accusations and quickly posted a 2-million-dollar bail. He is currently under travel restrictions within select zones in the states of New York, New Jersey, Washington, and California. In an attempt to nullify the charges in late March, Storm's lawyers expressed that the authorities lacked a solid justification for their allegations. Semenov, on the other hand, admitted contributing to creating the code of Tornado Cash, but refuses any responsibility regarding its various applications.
Pointing out that Tornado Cash neither functions as a custodial mixing service nor meets the requirements of a financial institution, Semenov's legal counsel states that as Storm had no control over the service, he couldn't block Lazarus Group or similar entities from using it. Despite this, a group of prosecutors led by Damian Williams have held firm in their motion, insisting that Semenov should be held responsible for operating the cryptocurrency mixer as it knowingly facilitated criminals in remaining anonymous.
This standoff takes place amidst the U.S. government's increased effort to regulate crypto-mixing services. Recently, in April 24, the top dogs of Samourai Wallet, a crypto mixer, including its CEO Keonne Rodriguez and CTO William Hill, were apprehended and charged with money laundering conspiracy and unregistered operation of a money transmission business.
CEO of CryptoQuant, Ki Young Ju, in response to the recent arrests, emphasized that crypto-mixing services are not inherently illegal.
Published At
4/28/2024 10:28:03 AM
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