The U.S. Department of Justice has announced the arrest of Aliaksandr Klimenka, a Belarusian and Cypriot national connected to the defunct cryptocurrency exchange BTC-e, on charges related to money laundering. BTC-e, described as a significant cybercrime and online money laundering entity, allowed users to trade bitcoin with high levels of anonymity, attracting a customer base heavily reliant on criminal activities. Klimenka, accused of helping run BTC-e, faces charges of money laundering conspiracy and operating an unlicensed money services business. His arrest in Latvia follows an indictment from 2022, and if convicted on all counts, he could potentially face up to 25 years in prison.
The Department of Justice alleges that BTC-e, despite substantial business in the United States, was not registered as a money services business, lacked anti-money laundering processes, and had no systems for proper ‘know your customer’ (KYC) verification or an anti-money laundering program as required by federal law. Klimenka, accused of controlling Soft-FX, a technology services company, and FX Open, a financial company, allegedly maintained BTC-e’s servers in the United States, which were crucial for the operation of the scheme. The arrest underscores the government’s stance on BTC-e’s violation of federal rules and its role in facilitating cybercrime and money laundering activities.
The arrest of Klimenka is part of a broader crackdown on cybercrime in the cryptocurrency space. BTC-e has been previously associated with money laundering, including the laundering of bitcoins stolen in the infamous Mt. Gox exchange attack. The Department of Justice had previously accused two other Russian nationals in connection with the Mt. Gox case. The arrest emphasizes the U.S. government’s commitment to pursuing individuals involved in cybercrime, especially those using cryptocurrency exchanges for illicit activities, and sends a strong message about the importance of adhering to regulatory standards in the digital currency space.
- Foreign National Charged for International Money Laundering Conspiracy and Role in Operation of Unlicensed Digital Currency Exchange BTC-e