The founder of a crypto mixing platform will end up in a US prison cell and will call it home for 12.5 years after a federal court ruled that the crypto firm owner was guilty of money laundering.
The sentence serves as a reminder that the US government is serious about cracking down on cryptocurrency platforms that are being used by unscrupulous individuals in their illegal activities.
Crypto Mixer Founder Jail-Bound
A Washington federal court sentenced the founder of the cryptocurrency mixing service Bitcoin Fog to be put behind bars and stay in a state prison for 12.5 years for facilitating money laundering on his platform.
Reports have disclosed that US District Judge Randolph Moss convicted Bitcoin Fog founder Roman Sterlingov for laundering $400 million in criminal proceeds on what state prosecutors called among the “largest and longest-running money laundering services.”
The prosecutors said that criminals used the crypto platform to launder the money that they got from illegal activities such as narcotics.
Moss also ordered the 36-year-old entrepreneur to sequester his $395 million assets and interest amounting to over $103 million worth of Bitcoin stored in a Bitcoin Fog wallet.
Sterlingov regretted any harm that he might have done as a result of his actions, adding, “I’m fully committed to becoming a better person.”
As of today, the market cap of cryptocurrencies stood at $2.55 trillion. Chart: TradingView
A Lighter Sentence
The 12-year imprisonment seems to be a lighter sentence as compared to the 30-year prison term being suggested by the US government and the maximum 50-year sentence stipulated in the US guidelines.
State prosecutor Christopher Brown said that the US government is pushing for a more severe punishment for Sterlingov, explaining that the size and duration of the scheme require a heavier sentence.
“This is criminal activity of a staggering scale over a prolonged period of time,” Brown added.
State prosecutors also said that Bitcoin Fog offered criminals a convenient way to use the money they have obtained from illicit activities, some of which are drug-related activities.
They added that Sterlingov’s crypto firm allowed transactions that made it difficult to trace the source of the proceeds, an ideal setup for individuals involved in criminal activities.
In a statement, Principal Deputy Assistant Attorney General Nicole M. Argentieri said that through Bitcoin Fog, the Russian Swiss crypto entrepreneur laundered more than $400 million in criminal proceeds, arguing that Sterlingov’s cryptocurrency platform provided criminals a medium to hide their dirty money.
A Warning
The federal judge said that a life sentence looks inconsistent with the level of culpability. However, Moss explained that the penalty needs to be harsh enough to deter other crypto personalities from doing the same.
Meanwhile, Argentieri said that Sterlingov’s sentence affirms the commitment of the US Department of Justice to making individuals accountable for helping criminals in their illegal activities.
Featured image from Serious Eats, chart from TradingView
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