The US Department of Justice has filed a civil lawsuit seeking to recover more than $100 million from a notorious cryptocurrency exchange that has helped cyber-criminals launder stolen funds, such as those obtained from ransomware payments, dark web drug marketplaces, and funds from hacked cryptocurrency exchanges.
In a lawsuit[1] filed on Friday, July 26, the US wants to recover $88,596,314 from the accounts of the now-defunct BTC-e cryptocurrency exchange, and an additional $12 million from Alexander "Mr. Bitcoin" Vinnick, BTC-e's founder and CEO.
Lawsuit wants to recover US fine in a sinking legal case
The sum represents a fine that was imposed by the US Treasury's Financial Crimes Enforcement Network (FinCEN) in 2017 when the FBI shut down the BTC-e portal, and Greek authorities arrested Vinnick.
For the past two years, the DOJ has been trying to extradite Vinnick to the US to face charges, but with no success.
In fact, in a shocking and unexpected decision, Greece's highest court ruled last year to extradite Vinnick to Russia[2], his home country, where he stands to face trial on much lighter charges than those brought forward by the US and France (also looking for Vinnick's extradition).
The DOJ's civil lawsuit is an alternative legal method to make sure the US Treasury FinCEN recovers its due fine in the case US authorities opened in 2017.
BTC-e was a hotbed for money laundering
Those fines were imposed because BTC-e violated the Bank Secrecy Act (BSA). First by not registering with US authorities as a Money Services Business (MSB), even if it catered to US consumers.
Second, for failing to implement an anti-money laundering (AML) program in accordance with US and many other international standards.