San Francisco, California – After more than five years of litigation, Russian national Alexander Vinnik was extradited to the United States yesterday to be held accountable for operating BTC-e, a criminal cryptocurrency exchange, which laundered more than $4 billion of criminal proceeds.
According to the indictment, Vinnik and his co-conspirators allegedly owned, operated, and administrated BTC-e, a significant cybercrime and online money laundering entity that allowed its users to trade in bitcoin with high levels of anonymity and developed a customer base heavily reliant on criminal activity.
The indictment alleges BTC-e facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and was used to facilitate crimes ranging from computer hacking, to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking.
Despite doing substantial business in the United States, the indictment alleges that BTC-e was not registered as a money services business with the U.S. Department of Treasury, had no anti-money laundering process, no system for appropriate “know your customer” or “KYC” verification, and no anti-money laundering program as required by federal law.
Vinnik, 42, was charged in a 21-count superseding indictment in January 2017 and was taken into custody in Greece in July 2017 at the request of the United States. He made his initial appearance earlier today in federal court in San Francisco before U.S. Magistrate Judge Sallie Kim.
The indictment charges Vinnik with one count of operation of an unlicensed money service business, and one count of conspiracy to commit money laundering. In addition, the indictment charges Vinnik with 17 counts of money laundering and two counts of engaging in unlawful monetary transactions.
The FBI, IRS Criminal Investigation, Homeland Security Investigations, and U.S. Secret Service Criminal Investigative Division are investigating the case. Trial Attorney C. Alden Pelker of the Justice Department’s Computer Crime and Intellectual Property Section, and Assistant U.S. Attorney Claudia Quiroz of the U.S. Attorney’s Office for the Northern District of California are prosecuting the case.
The Justice Department’s National Cryptocurrency Enforcement Team provided substantial assistance. The extradition request was handled by the Justice Department’s Office of International Affairs. The Justice Department thanks the Greek Ministry of Justice for its cooperation in securing the defendant’s transfer to the United States.
A civil matter to enforce civil monetary penalties, in the amount of $88,596,314 as to BTC-e and $12 million as to Vinnik, is pending in the Northern District of California.
Related Federal Cases
- Detroit Federal Agents, Money Laundering, Detroit MI, 2024 · Texas
- Christopher Furman, Wire Fraud and Money Laundering, Pennsylvania 2009 · California
- Official 1 Name Not Given, Money Laundering, Washington (D.C.) 2023 · California
- Defendant Unknown, Money Laundering Investigation, Washington DC, 2023 · California
- David Lewis McDowell, Money Laundering, Riverside CA, 2023 · Oklahoma
Key Facts
- State: California
- Category: Cybercrime|Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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