U.S law enforcement officials dealt a serious blow to BTC-e this week, fining the cryptocurrency exchange and its owner a total of $112 million for a host of alleged criminal activities. The Treasury's Financial Crimes Enforcement Network revealed that the exchange has been fined $100 million fine for aiding in the commission of crimes that include ransomware attacks and drug sales. Another $12 million fine was assessed against Alexander Vinnik, BTC-e’s owner.
The move was obviously a coordinated effort, as the United States Justice Department took action against Vinnik on the same day. The DOJ reportedly filed money laundering and conspiracy charges against the exchange owner. He remains in the custody of Greek law enforcement officials after being arrested in Greece on Tuesday, pursuant to a U.S. warrant. Greek officials anticipate that the American government will seek his extradition.
The government of the United States has accused BTC-e of willfully ignoring KYC laws in order to provide a platform for criminals. The DOJ is accusing the exchange of knowingly receiving “the criminal proceeds of numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings.”
Vinnik is also being accused of taking part in the Mt.Gox hack. The indictment alleges that the funds stolen from that exchange had apparently been traced to accounts he controlled.