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The co-founders of cryptocurrency mixer Samourai Wallet have been arrested on charges of money laundering brought by the United States Justice Department (DOJ) and other agencies.&nbsp;
Samourai Wallet CEO Keonne Rodriguez and chief technology officer William Hill will each face one count of conspiracy to commit money laundering, with a maximum sentence of 20 years in prison, and one count of conspiracy to operate an unlicensed money transmitting business, with a maximum sentence of five years in prison. 
Rodriguez was arrested on the morning of April 24 in Pennsylvania, and Hill was arrested the same day in Portugal. According to a statement released by the United States Attorney’s Office of the Southern District of New York, the United States will <a href="https://www.justice.gov/usao-sdny/pr/founders-and-ceo-cryptocurrency-mixing-service-arrested-and-charged-money-laundering" target="_blank" rel="noopener nofollow">seek</a> Hill’s extradition. The company’s servers and domain were also seized in Iceland,&nbsp;and a warrant has been served to stop downloads of the company’s app from the Google Play Store. The app has been downloaded more than 100,000 times. 
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-04/9d4f9323-51a7-429e-adb0-7953d49d3da3.png" alt="" title="">
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 Screenshot of the Samourai Wallet homepage. Source: doj.gov
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The U.S. Internal Revenue Service and Federal Bureau of Investigation also took part in the investigation. According to the DOJ statement, Samourai Wallet:
<blockquote data-ct-non-breakable="true">
 “Executed over $2 billion in unlawful transactions and facilitated more than $100 million in money laundering transactions from illegal dark web markets, such as Silk Road and Hydra Market; a web-server intrusion; a spearphishing scheme; and schemes to defraud multiple decentralized finance protocols.” 
</blockquote>
Samourai Wallet offered its Whirlpool crypto mixing service and Ricochet service, which created additional, unnecessary transactions to further muddy users’ crypto paths. They allegedly made $4.5 million from fees. 
Related: <a href="https://cointelegraph.com/news/arbitrum-dao-vote-1-million-fund-tornado-cash-devs-legal-defense">Arbitrum DAO votes on $1M fund for Tornado Cash devs’ legal defense</a>
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 <img src="https://s3.cointelegraph.com/uploads/2024-04/bbd51d54-19d9-4ec7-a4f8-3a7d8a0da898.png" alt="" title="">
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 Source: <a href="https://twitter.com/bitfinex/status/1772733827955282319" target="_blank" rel="noopener nofollow">Bitfinex</a>
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The U.S. government has become increasingly aggressive toward <a href="https://cointelegraph.com/news/cryptocurrency-mixers-and-why-governments-may-want-to-shut-them-down">crypto mixers</a>. The Treasury Department’s Office of Foreign Asset Control (OFAC) <a href="https://cointelegraph.com/news/crypto-mixer-sanctioned-by-us-treasury-for-role-in-axie-infinity-hack">sanctioned Blender.io</a> in May 2022 after the Axie Infinity hack. The OFAC <a href="https://cointelegraph.com/news/us-treasury-sanctions-usdc-and-eth-addresses-connected-to-tornado-cash">added addresses associated</a> with the Tornado Cash mixer to its list of Specially Designated Nationals in October 2022, effectively banning U.S. residents from using the service. That decision <a href="https://cointelegraph.com/news/tornado-cash-lawsuit-judge-sides-treasury-request-summary-judgement">survived a court challenge</a>. The three co-founders of Tornado Cash had&nbsp;<a href="https://cointelegraph.com/news/tornado-cash-co-founders-charged-with-money-laundering-sanctions-violations-ofac">all come under arrest</a> by August 2023.
In October 2023, the Treasury’s Financial Crimes Enforcement Network <a href="https://cointelegraph.com/news/us-treasury-crypto-mixers-money-laundering">proposed designating crypto</a> mixers as a “primary money laundering concern” after the Hamas attack on Israel.
Magazine: <a href="https://cointelegraph.com/magazine/tornado-cash-2-0-the-race-to-build-safe-and-legal-coin-mixers/">Tornado Cash 2.0: The race to build safe and legal coin mixers</a>

Samourai Wallet mixer co-founders arrested on AML, licensing charges

Cointelegraph

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