Secret Service charges 21 people in crypto money laundering bust

Members of the U.S. Secret Service speak on a mobile phone with President-elect Donald Trump during a meeting at the US Capitol in Washington, DC, November 10, 2016.

Saul Loeb | AFP | Getty Images

The U.S. Attorney’s Office for the Eastern District of Texas announced Wednesday that it has indicted 21 people in an international crypto money laundering network that laundered millions of dollars of fraudulent money from thousands of U.S. victims. did.

The indictment was unsealed as part of “Operation Crypto Runner” set up by Eastern District of Texas U.S. Attorney Britt Featherston, the Secret Service, and the U.S. Postal Inspection Service.

“These arrests are just the beginning. We are committed to bringing each of the remaining perpetrators to justice,” said Special Agent William Sumer of the Secret Service.

Law enforcement officials said more than $300 million in annual flows of laundered transactions are disrupted and millions of dollars in cash and cryptocurrencies are seized and confiscated.

The scheme is aimed specifically at older people, Featherston said.

“This case proves that we can track down and prosecute these people,” Bill Mack, head of Secret Service resident agents, told CNBC’s Eamon Javers.

The federal attorney for the Eastern District of Texas also released details of those named in the indictment and those who pleaded guilty.

John Khuu, 27, was indicted in federal court on money laundering conspiracy. Koo allegedly laundered more than $5 million in illegal proceeds from counterfeit drugs and controlled substances across the United States.

Randall Rule, 71, and Gregory Nicewander, 64, were indicted in federal court for using cryptocurrency to launder more than $2.4 million in proceeds from wire and mail fraud schemes.

This is not the first major action federal law enforcement has taken in the crypto space.

August, U.S. Treasury Department Licensed Currency Mixer Tornado Cashthe federal government claimed was used to launder more than $7 billion in cryptocurrency since its creation. Shortly after the sanctions, Tornado developer Alexey Pertsev arrested He was arrested in Amsterdam for his involvement in “covering up criminal financial flows and facilitating money laundering,” according to Dutch law enforcement.

— CNBC’s Eamon Javers contributed to this report.

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