DOJ Files An Enforcement Action Against Bitzlato For $700 Million In Illegal Activities

Key Points:

• The United States Department of Justice said that it will pursue legal action against the Russian trading site Bitzlato.
• Anatoly Legkodymov, the creator and primary stakeholder of Bitzlato, was detained last night in Miami on accusations of conducting a money laundering enterprise in breach of US regulatory protections, including anti-money laundering regulations.

The US Department of Justice said on January 19 that it will pursue legal action against the Russian trading website Bitzlato.

Anatoly Legkodymov, the creator and primary stakeholder of Bitzlato, was detained last night in Miami on accusations of conducting a money laundering enterprise in breach of US regulatory protections, including anti-money laundering regulations. 

The United States Department of Justice and the Treasury Department announced today a joint enforcement action against an international cryptocurrency firm. This inquiry focuses on the Hong Kong-registered cryptocurrency trading site Bitzlato.

According to Deputy Attorney General Lisa Monaco, US officials have disrupted the Hong Kong-based website Bitzlato, and the platform’s founder, Anatoly Legkodymov, has been detained. This effectively ends the platform’s continued support for recognized illegal behavior related to Russia. Monaco was describing coordinated enforcement measures including the Federal Bureau of Investigation and the US Treasury Department. Monaco described the operation as the most important yet against a crypto criminal network.

The authorities stated that BitZlato gave electricity to darknet markets and aided in the process of ransomware attacks, totaling over $700 million in illegal activities, both directly and indirectly, between 2018 and 2022. The fact that the network took relatively little in the way of personally identifiable information from its users, as is the case with the bulk of bigger exchanges, made it enticing to criminals.

Anatoly Legkodymov, the Russian kingpin, was arrested in Miami on Tuesday evening on suspicion of running a money transfer corporation that violated anti-money laundering regulations and transmitted unlawful monies. The 40-year-old crypto billionaire, who presently resides in China, will be taken before the United States District Court for the Southern District of Florida on Wednesday afternoon to face the criminal allegations.

The announcement was made at noon on Wednesday by Deputy Attorney General Lisa Monaco, who presided over a press conference with FBI Associate Deputy Director Brian Turner, US Attorney for the Eastern District of New York Breon Peace, Assistant Attorney General Kenneth Polite of the Department of Justice’s criminal division, and Deputy Treasury Secretary Wally Adeyemo.

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