See More

Crypto Exchange Founder Pleads Guilty To Operating ‘Safe Haven’ For Criminals

1 min
Updated by Ciaran Lyons
Join our Trading Community on Telegram

In Brief

  • Anatoly Legkodymov, admits guilt in illicit fund movement, spotlighting lax controls in illicit transactions.
  • Bitzlato, an alleged refuge for criminals, facilitated $700 million in darknet transactions until April 2022.
  • Deputy Attorney General Monaco stresses dismantling crypto crime, emphasizing consequences for lax controls.
  • promo

Anatoly Legkodymov, the founder of crypto exchange Bitzlato pleaded guilty to charges related to operating a money transmitting business that facilitated the movement of illicit funds.

The charges highlighted Bitzlato’s role as a primary facilitator for dark market transactions. Furthermore, his lax controls over illicit money transactions.

Crypto Exchange Founder Oversees Millions In Illicit Funds

Legkodymov admitted to the operation of Bitzlato, which attracted criminals seeking a refuge for their activities.

Meanwhile, the crypto exchange, marketed as having minimal identification requirements, allegedly became a “safe haven for criminals” due to a lack of know-your-customer (KYC) procedures.

However, Bitzlato’s largest counterparty in cryptocurrency transactions was Hydra Market. This is a notorious online marketplace dealing in narcotics, stolen financial information, fraudulent identification documents, and money laundering services.

Users exchanged over $700 million worth of cryptocurrency with Bitzlato. This makes it a key player in the illicit darknet market until Hydra Market’s shutdown in April 2022.

Should All Crypto CEOS Leave? Source: BeInCrypto

Authorities Claim Legkodymov Turned a Blind Eye

However, deputy Attorney General Lisa O. Monaco emphasized the government’s commitment to disrupting cryptocrime. She cited the takedown of Bitzlato’s infrastructure and seizure of its cryptocurrency earlier this year as part of ongoing efforts.

Learn more: How To Identify a Scam Crypto Project

According to the DoJ, Bitzlato had a “no questions asked” clearinghouse approach.

This allegedly enabled criminals to exploit the exchange’s lax controls, is the primary cause of its downfall.

The case was jointly prosecuted by the United States Attorney’s Office for the Eastern District of New York and the National Cryptocurrency Enforcement Team (NCET). This is a unit dedicated to combating illicit cryptocurrency use.

Learn more: 15 Most Common Crypto Scams To Look Out For

Top crypto platforms in the US | February 2024

Trusted

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

ciaran-lyons-avatar.png
Ciaran Lyons
Ciaran is a cryptocurrency journalist based in Sydney, Australia. He particularly enjoys writing about CBDC developments and the practical implementations of cryptocurrency in real-world scenarios. He has also appeared across major television networks in Australia including Channel Ten, Channel Nine and SBS TV. Prior to his foray into cryptocurrency, Ciaran worked as a presenter on national radio station Triple J.
READ FULL BIO
Sponsored
Sponsored