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Bitcoin Dealer Charged with International Money Laundering

Bitcoin Dealer Charged with International Money Laundering

Reading Time: 2 minutes by on August 23, 2018 Bitcoin, Crime, News, Regulation
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A 21-year-old Bitcoin dealer is currently being prosecuting for illegal money transmission and money laundering. According to the Department of Justice in the Southern District of California, Jacob Burrell Campos was arrested in August 2018, as he attempted to enter the United States from Mexico.

He was ordered to be held without bail on Friday, August 17, 2018, at a hearing for the charges.

Dealer Sells $750,000 in Bitcoin

The statements in the report made by Assistant U.S. Attorney Robert Ciaffa noted that Burrell was a popular Bitcoin dealer who sold approximately $750,000 in Bitcoin. Burrell sold the cryptocurrency to thousands of buyers in the United States. He underwent 971 separate transactions and had over 900 different customers. He accepted cash in person, through his bank account and also used MoneyGram, a money transfer payment system.

Ciaffa noted that based on Burrell’s activities, he was operating a Bitcoin exchange and ran a “money transmitting business.”

Since Burrell had a money transmitting business he was therefore required to register his business with the Department of Treasury and follow the procedures required for anti-money laundering requirements. These include reporting any suspicious cash-based transactions.

Busted in Taiwan

Unfortunately, Burrell did not follow these rules and guidelines. He had even accepted cash with a no questions asked approach in exchange for cryptocurrencies with a 5 percent fee.

Ciaffa reported that:

“Burrell’s activities blew a giant hole through the legal framework of US anti-money laundering laws by soliciting and introducing into the US banking system close to $1 million in unregulated cash.”

In addition to his existing charges, he is also indicted with 28 counts of international money laundering. He sent 28 wire transfers worth over $900,000 from his bank in the United States to an account in Taiwan in the name of Bitfinex. Ciaffa commented that Burrell sent the money from the United States to provide enough capital for his business.

Burrell then purchased over $3 million in bitcoin in more than 2,600 transactions. After his account was closed by Coinbase, due circumventing their ID verification system, he then purchased bitcoin through Bitfinex.

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