Murgio Senior Avoids Jail in Bitcoin Exchange Coin.mx Case

The indictment alleges that in April 2014 Michael Murgio executed an agreement with Gross on behalf of Coin.mx.

Michael Murgio, a longtime educator in Palm Beach County, and his father Anthony Murgio, who authorities say ran an unlicensed Bitcoin exchange, avoided jail time at their sentencing today after pleading guilty on a lesser charge.

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Anthony Murgio found himself in 2014 entangled in an international digital currency scheme involving his son, who prosecutors allege assisted hackers.

Anthony Murgio, 66, at a hearing in New York was sentenced to one year of probation, a $12,000 fine and 200 hours of community service. He had faced the possibility of more severe sanctions, with federal prosecutors in Manhattan seeking 10 to 16 months in prison for him.

US authorities accused the former Palm Beach County School Board member a year ago of playing a role in a digital-currency scheme that helped international hackers extort money. Six months after his arrest, Anthony Murgio decided in April 2016 to plead guilty to a single count of making a false statement to the national credit union association.

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As a result of his plea, federal prosecutors have agreed to drop the rest of their case against him, including a charge of making corrupt payments with intent to influence an officer of a financial institution.

International digital currency scheme involving his son

The case is related to his son’s involvement in co-running the Florida-based bitcoin exchange Coin.mx which shut down amid charges of money laundering and connections to a JP Morgan hack.  Anthony Murgio pleaded guilty this month to three counts related to cooperating with criminal enterprises and being involved in various ransomware schemes.

Murgio’s son was not accused of engaging in the hacking offences, but he committed crimes with co-defendants Yuri Lebodev of Florida and Trevon Gross, a New Jersey pastor, in the unlicensed Coin.mx operation. Earlier in September 2016, a federal court ruled that Anthony can’t escape counts of operating an illegal money-transmitting business by questioning bitcoins’ status as funds.

Over the course of the alleged scheme, which ran from 2013 to 2015, prosecutors said that through Coin.mx the conspirators allowed their customers to exchange cash for bitcoins, charging a fee for their service. In doing so, they did business with people that they knew might be engaging in criminal activity. Charges in the cases also included computer hacking, securities and wire fraud, identity theft, illegal Internet gambling and conspiring to commit money laundering.

According to prosecutors, Coin.mx was owned by Gery Shalon, an Israeli accused of masterminding a hacking scheme with another Israeli, Ziv Orenstein, and Maryland-born Joshua Samuel Aaron. Prosecutors said the men operated a criminal enterprise that hacked into a dozen companies’ networks and stole personal data from more than 100 million people.

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