Execs Arrested for Illegal Exchange, ML, etc


These guys have been busy! The two main operators of the bitcoin exchange were arrested for operating an illegal money exchange, money laundering, knowingly laundering money from bitcoin ransom attacks, operating a connected business without the proper paperwork, operating fake websites, failing to file suspicious activity reports (as financial institutions are required to do), and possible connections to “pump and dump” schemes and attack on banks.

The full complaint with charges plus mode of scam operation can be read at

Article from: Execs Arrested for Operating Illegal Bitcoin Exchange

Updated July 22, 2015

Two operators of the bitcoin exchange service are being charged by US prosecutors for working without a money transmission license.

Anthony Murgio and Yuri Lebedev have been accused of operating in violation of federal anti-money laundering statutes. The charges were unveiled today by the US Attorney's Office of the Southern District of New York.

Murgio was charged with one count of money laundering and one count of willful failure to file a suspicious activity report. Both Murgio and Lebedev were charged with one count of conspiracy to operate an unlicensed money transmitting business and one count of operating an unlicensed money transmitting business. The case will be held in the Middle District of Florida.

According to a statement from the US Federal Bureau of Investigation, which collaborated with the US Secret Service on its investigation of, Murgio and Lebedev were accused of knowingly handling funds tied to bitcoin ransomware attacks.

The agency noted:

"In doing so, Murgio, and his co-conspirators knowingly enabled the criminals responsible for those attacks to receive the proceeds of their crimes, yet, in violation of federal anti-money laundering laws, Murgio never filed any suspicious activity reports regarding any of the transactions."

The operators were accused of unlawfully transmitting hundreds of thousands of dollars overseas, and face decades in prison apiece if convicted.

Federal prosecutors alleged that in order to conceal the true nature of the company, operated via a "Collectables Club" entity based in Florida. Rather than "customers", claimed to service "members" who engaged in exchange activities.

Federal prosecutors further alleged that, in order to avoid possible regulatory problems, Murgio gained control of a New Jersey-based credit union through which conducted its banking activities, making it a "captured bank" through which to transfer funds.

The National Credit Union Administration is said to have uncovered the activity and compelled the unnamed credit union to stop acting as a banking service for The operators then went on to utilize alternative, international payment processing services thereafter.

The website was unavailable at press time. Users reported earlier today that the site was inaccessible.

Link to Wall Street bank hacks
Federal investigators also unveiled charges against four other individuals with connections to Murgio that were involved in a stock pump-and-dump scheme.

Those individuals are said to be involved in high-profile cyberattacks on Wall Street banks including JP Morgan Chase and four others that took place in 2014. At the time, the assailants were able to access JP Morgan's systems and abscond with sensitive customer data before being discovered.

According to Bloomberg News, Murgio was named in a previously undisclosed FBI memo related to the cyberattacks.