DOJ Extradition Potential Cryptocurrency Money Launderer

Dubnikov could spend up to 20 years behind bars, according to the (DOJ) Department of Justice.

DOJ extradites alleged launderer 

The US government is stepping up its efforts to crack down on cryptocurrency-related crime.

The Department of Justice confirmed Wednesday that it has extradited a suspected bitcoin launderer from the Netherlands in another crypto-related update.

Denis Mihaqloviv Dubnikov, a 29-year-old Russian male, was called before a federal court in Portland, Oregon on Wednesday on suspicion of laundering ransom payments related to the Ryuk ransomware assaults. If found guilty, he may spend up to 20 years in jail, the press release stated.

“After receiving ransom payments, Ryuk actors, Dubnikov and his co-conspirators, and others involved in the scheme, allegedly engaged in various financial transactions, including international financial transactions, to conceal the nature, source, location, ownership, and control of the ransom proceeds” the release noted. 

Dubnikov in charge of laundering ransomware payments of $400,000 in 2019

Ryuk is a ransomware software bug that emerged in 2018 and has since targeted thousands of victims worldwide. Data on infected devices is often encrypted by Ryuk, who then demands a ransom payment—often in Bitcoin—from victims in order to unlock the data. Since its inception, the Justice Department believes it has stolen more than $70 million.

Ryuk has recently been linked to Russian crime syndicates after first being considered to be the work of North Korean state-sponsored cybercriminals. It came before Conti, a Russian ransomware flaw whose authors used Ethereum and other blockchains to launder billions of dollars’ worth of stolen cryptocurrency.

The Dubnikov case occurs at a time when the US government is stepping up efforts to crack down on illegal conduct using digital assets. Tornado Cash was sanctioned last week by the Treasury Department’s Office of Foreign Assets Control due to its acceptance by the Lazarus Group and other criminals in North Korea.

The Blender and Ethereum mixer have both been added to a blacklist, but the prohibition on the latter was remarkable because OFAC sanctioned the smart contract code directly rather than just a list of related addresses.

Dubnikov’s extradition was overseen by the Justice Department’s Office of International Affairs, and the FBI and its newly formed Ransomware and Digital Extortion Task Force are both involved in the investigation.

On October 4, Dunikov’s five-day trial is scheduled to start.

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