Two foreign nationals charged with Cryptocurrency laundering

  • Richard Marley
  • March 11, 2020
  • 3 minutes read
  • 2128

The United States Department of Justice has charged two Chinese nationals with laundering $100 million in cryptocurrency that was part of $230 million hacked from a virtual currency exchange by North Korean co-conspirators. Tian Yinyin and Li Jiadong were conspiring to hack a cryptocurrency exchange and launder money assets while operating an unlicensed money transfer business.

The accused did business in the United States but their business was not registered with the Financial Crimes Enforcement Network (FinCEN). They conducted business using independent accounts and provided cryptocurrency channeling services to the customers for a fee. 

“The hacking of virtual currency exchanges and related money laundering for the benefit of North Korean actors poses a grave threat to the security and integrity of the global financial system,” according to the US Attorney Timothy Shea. The North Korean co-conspirators outwitted multiple cryptocurrency exchanges’ controls by submitting forged images and manipulated identification documentation, according to the complaint. A segment of the laundered funds was used to pay for infrastructure used in North Korean spamming campaigns against the financial industry.

Don Fort, the Internal Revenue Service-Criminal Investigation (IRS-CI) Chief stated: “We will continue to push our agency to the forefront of complex cyber investigations and work collaboratively with our law enforcement partners to ensure these nefarious criminals are stopped and that the integrity of the United States financial system is preserved.”

Calvin Shivers, the Assistant Director of the FBI’s Criminal Investigative Division also commented that the FBI will actively collaborate with the domestic and foreign enforcement agencies to detect and inhibit the illegal exchange of currency. He stated: “Today’s indictment and sanctions send a strong message that the United States will not relent in holding accountable bad actors attempting to evade sanctions and undermine our financial system.”

There were more than a hundred named virtual currency accounts and addresses used by Yinyin and Jiadong. Penalties have been imposed on the two Chinese nationals and a number of cryptocurrency addresses involved by the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC). The suspects have to hand over any assets and funds involved in the plot. 

According to Acting Executive Associate Director, Alysa Erichs, “This indictment shows what can be accomplished when international law enforcement agencies work together to uncover complex cross-border crimes,”