Security News > 2022 > May > US brings first-of-its-kind criminal charges of Bitcoin-based sanctions-busting

US prosecutors have accused an American citizen of illegally funneling more than $10 million in Bitcoin into an economically sanctioned country.

It's said the resulting criminal charges of sanctions busting through the use of cryptocurrency are the first of their kind to be brought in the US. Under the United States' International Emergency Economic Powers Act, it is illegal for a citizen or institution within the US to transfer funds, directly or indirectly, to a sanctioned country, such as Iran, Cuba, North Korea, or Russia.

The Office of Foreign Assets Control, the US agency responsible for enforcing the IEEA, for example, has settled with companies BitGo and BitPay for processing digital currency transactions from customers in sanctioned countries.

The service advertised itself as being "Designed to evade US sanctions" and claimed its transactions were untraceable, it was alleged.

The defendant used these two accounts to move at least $10m in Bitcoin from the US to the sanctioned country for the payment platform's users, it is alleged.

"Defendant's transmission of virtual currency to the sanctioned country violated US sanctions. Independently, Defendant faces liability because his transactions caused the virtual currency exchanges, perhaps unwittingly, to violate sanctions," the judge added.

News URL

https://go.theregister.com/feed/www.theregister.com/2022/05/16/judge_cryptocurrency_sanctions/