FBI charges six individuals in multimillion-dollar Bitcoin money-laundering scheme
The Federal Bureau of Investigation (FBI) has charged six individuals in connection to an unlicensed money-transmitting business involving crypto as a money laundering tool.
Court filings dated Oct. 18 indicate that the accused individuals worked to convert Bitcoin and other cryptocurrencies to cash at least between July 2021 and September 2023. The conversion process involved cash shipped via the U.S. postal system in exchange for cryptocurrency as well as in-person cash pickups.
The six accused individuals are Shaileshkumar Goyani, Brijeshkumar Patel, Hirenkumar Patel, Naineshkumar Patel, Nileshkumar Patel, and Raju Patel.
The FBI charged those individuals with one count of conspiracy to operate an unlicensed money-transmitting business and one count of operating an unlicensed money-transmitting business. The case text requests a warrant for the individuals’ arrests, indicating that they had not yet been brought into custody at the time of the court filing.
The case is proceeding in the Southern District of New York, where the criminal activity largely took place. New York has stringent crypto rules as well as regulations that require anyone transmitting money to obtain the relevant license.
Two others were involved in conspiracy
Though six individuals have been charged, they do not make up the entire operation. One anonymous co-conspirator began to communicate with law enforcement after being contacted by an undercover officer around January 2023.
The co-conspirator, who operated on darknet markets and peer-to-peer crypto exchanges, revealed he had earned $30 million in crypto by swapping funds. He also stated that many clients of the service were drug dealers and hackers.
Another individual who mailed cash on behalf of the co-conspirator was later arrested by law enforcement and became a confidential source. That individual eventually began to participate in controlled cash pickups with law enforcement.
Those two individuals were charged separately in August 2023 and February 2023. The latter could receive a reduced sentence due to his cooperation with authorities.
The FBI has a track record of seizing cryptocurrency involved in illegal activities. Notably, the agency has seized $3.36 billion from Silk Road fraudster James Zhong and $3.6 billion from Bitfinex hackers Ilya Lichtenstein and Heather Morgan since 2022.
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