Cryptocurrency Money Laundering

Given the instantaneous nature of cryptocurrency transactions, they have become the financial instrument of choice for many transnational business deals and investment opportunities. Criminal enterprises have also taken note of the instantaneous, unregulated, and largely anonymous nature of cryptocurrency transactions.

The number of businesses accepting Bitcoin and cryptocurrencies as a payment method are growing exponentially. As the number of businesses accepting digital currencies grows, simultaneously does the ease for criminals to use crypto as a money-laundering tool. If you are facing money-laundering charges generally, and money-laundering charges relating to bitcoin and other cryptocurrencies, contact an experienced Miami criminal trial attorney to defend yourself accordingly.

What is Bitcoin Money Laundering?

Bitcoin laundering is a type of financial scheme that conceals the identity of money made from illegal sources. Generally, this is done through putting illegally earned income into Bitcoin, mixing the Bitcoin to hide the source, and cashing out.

There are two components for a Bitcoin or other cryptocurrency money laundering scheme.

(1) A Mixing Service - an online service that allows users to wipe their bitcoin free of any tracing information. Bitcoin operates on blockchain technology, a ledger that records all transactions. The ledger records coins, not users.

(2) An Exchange Service - allows users to convert bitcoin to cash anonymously. Generally, the transaction, referring to the transfer of Bitcoin to cash, is the most vulnerable part of a crypto exchange for criminals. If the transaction is flagged as illegal, authorities can use the cash out to identify the user. Discrete exchange services have begun popping up, allowing users to more discretely withdrawal their money.

Not only is it illegal to use these services for money laundering, if you operate a service that is used for laundering purposes, you may face criminal repercussions.

Bitcoin laundering has proven a feasible method for criminals to clean their earnings. Experts estimate that bitcoin laundering is already a popularly utilized method, and it is likely to grow exponentially into the future. Aware of the activity, Florida and US federal prosecutors have already begun cracking down on bitcoin laundering activity. Individuals under investigation for crypto laundering should contact a Miami criminal defense attorney for a consultation.

Bitcoin Laundering Charges

Money laundering is illegal under federal and Florida state law.

Under Florida law, money laundering can be considered a 3rd, 2nd, or 1st degree felony depending on the amount in controversy. Penalties range from up to five years in prison to up to 30 years. Additionally, a fine of up to $250,000 may be charged, or double the total amount of all money laundering proceeds.

State prosecutors have the duty to prove:

(1) The defendant undertook a financial transaction, or a number of financial transactions, with the intent to hide, conceal, or disguise money;

(2) The disguised money was earned through criminal activity;

(3) The defendant was aware that the financial transaction was funded by illegal activity.

Under the Federal Money Laundering Control Act of 1986, money laundering is a federal crime. If the defendant undertook a financial activity with the intent to conceal criminal earnings, they are in violation of the act. Also, any activity that intentionally promotes the activity is illegal under 18 U.S.C. § 1956.

Federal and Florida State Criminal Defense Attorney

The above charges carry serious implications. If you, or a family member are facing crypto-related money laundering charges, it is important to have an experienced attorney as part of your team.