Bitzlato Founder Pleads Guilty to $700M Illicit Transfer Charge

DailyCoin2023/12/08 01:48

By:DailyCoin

A Hong Kong-based crypto exchange co-founder has pleaded guilty in the U.S.
The executive was charged with moving millions of dollars in illicit funds.
The executive agreed to dissolve the exchange as part of the plea agreement.

The co-founder of Hong Kong-based crypto exchange Bitzlato has pleaded guilty in the U.S. to running a business accused of processing hundreds of millions of dollars in illicit funds.

On December 6, the U.S. Attorney’s Office, Eastern District of New York, announced that Anatoly Legkodymov, also a Russian national, entered his guilty plea in federal court in Brooklyn before Judge Eric N. Vitaliano.

Legkodymov’s Role at Bitzlato

According to the press release , Legkodymov’s guilty plea stems from his role at Bitzlato Ltd. This crypto exchange allegedly served as a “primary conduit for dark market purchasers and sellers, as well as a safe haven for ransomware criminals.”

Specifically, the U.S. Attorney’s Office alleged that as a senior executive and the majority shareholder at Bitzlato, Legkodymov implemented “lax controls over illicit money transactions” by allowing users to submit identity information belonging to “straw man” registrants.

As a result, Bitzlato became a haven for Hydra Market, an online marketplace that exchanged over $700 million tied to narcotics, money laundering services, stolen financial information, and fraudulent identity documents.

“As alleged, Bitzlato advertised a safe haven for fraudsters, thieves, and other criminals to launder illicit proceeds—but their business model didn’t account for federal law enforcement,” New York Deputy Attorney General Lisa O. Monaco stated.

Legkodymov Pleads Guilty

Following these allegations, Legkodymov pleaded guilty to operating a money-transmitting business that “transported and transmitted” illicit funds. As part of his guilty plea, Legkodymov agreed to dissolve Bitzlato and to release any claim over $23 million in seized assets of the exchange.

“We are dismantling and disrupting the cryptocrime ecosystem using all tools available—including criminal prosecution. In January, the Department and our partners took down Bitzlato’s infrastructure and seized its cryptocurrency. Today’s conviction of Bitzlato’s founder is the latest product of our efforts.” Monaco remarked.

The U.S. brought Legkodymov to book in collaboration with the Cyber Division of the Paris Prosecution Office and France’s Gendarmerie Nationale Cyberspace Command.

Read how a senior lawyer tied to Ruja Ignatova recently pleaded guilty:
Cryptoqueen Ruja Ignatova’s Chief Counsel Pleads Guilty

Stay updated on the sentencing of Thodex crypto exchange founder:
Thodex Crypto Exchange Founder Jailed for 11,196 Years

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