Founders of Crypto Mixer Tornado Cash Accused of Laundering $1 Billion – The creators of Tornado Cash, a cryptocurrency mixing service, were accused on Thursday of assisting in laundering over $1 billion in digital currency, which included funds obtained by North Korean hackers. Roman Storm and Roman Semenov have been federally indicted for charges including money laundering conspiracy, violation of sanctions laws conspiracy, and operating an unlicensed money-transmitting business.
While Storm was apprehended in Washington, Semenov is currently evading capture. According to prosecutors, Storm and Semenov purposefully created Tornado Cash with the intent of allowing cybercriminals to make fund transfers on the blockchain while remaining anonymous. The indictment states that the platform was utilized to launder over $1 billion in digital currency, thereby breaching U.S. sanctions.
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During the spring of this year, it is suspected that Tornado Cash played a role in laundering a portion of the $600 million that was pilfered by North Korean-backed hackers during a March assault on the Ethereum sidechain known as the Ronin Network. Despite implementing sanctions screening measures, the company allegedly employed misleading compliance methods, as indicated by prosecutors, to continue handling unlawful transactions.
“As alleged, Tornado Cash was an infamous cryptocurrency mixer that laundered more than $1 billion in criminal proceeds and violated U.S. sanctions,” Damian Williams, the U.S. attorney for the Southern District of New York said in a statement. “Roman Storm and Roman Semenov allegedly operated Tornado Cash and knowingly facilitated this money laundering.”
In the midst of a broader initiative led by the Department of Justice to curb the use of cryptocurrencies for facilitating cybercriminal activities and sidestepping sanctions, these allegations have emerged. This strategic move aligns with the ongoing crackdown on a national level. It’s worth noting that this effort comes on the heels of a significant development from the previous year: the incarceration of Alexey Pertsev, a developer associated with Tornado Cash, by Dutch authorities.