US Indicts Two Chinese for $100 Million Crypto Laundering

The funds were obtained by attacks on crypto exchanges by North Korean co-conspirators.

The United States Department of Justice has charged two Chinese nationals for laundering $100 million in digital currencies obtained from the hack of a crypto exchange.

Announced on Monday, the accused, named Tian Yinyin and Li Jiadong, were charged with “money laundering conspiracy and operating an unlicensed money transmitting business.”

The authorities also revealed that the attacks on the exchanges were carried out by hacking groups with North Korean ties. However, the name of the breached exchange was not revealed.

Mentioning the crime, Brian A. Benczkowski, assistant attorney general of the Justice Department, said: “These defendants allegedly laundered over a hundred million dollars worth of stolen cryptocurrency to obscure transactions for the benefit of actors based in North Korea. Today’s actions underscore that the Department will pierce the veil of anonymity provided by cryptocurrencies to hold criminals accountable, no matter where they are located.”

Links to North Korea

The press release detailed that the breach on the unnamed exchanges resulted in the theft of $250 million in cryptocurrencies in 2018. The perpetrators then channeled these funds through hundreds of automated cryptocurrency transactions aimed at preventing law enforcement from tracing the funds.

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Moreover, the North Korean co-conspirators also circumvented multiple virtual currency exchanges’ know-your-customer controls by submitting doctored photographs and falsified identification documentation.

The two accused laundered the hefty sum between December 2017 and April 2019, operating through independent as well as linked accounts and provided virtual currency transmission services for a fee to customers, the press release detailed.

The civil forfeiture complaint also specifically named 113 virtual currency accounts and addresses that were used by the defendants and unnamed co-conspirators to launder funds.

The law enforcement is now trying to recover the ill-gotten funds, and successfully seized a portion of it.

“North Korea continues to attack the growing worldwide ecosystem of virtual currency as a means to bypass the sanctions imposed on it by the United States and the United Nations Security Council. IRS-CI is committed to combating the means and methods used by foreign and domestic adversaries to finance operations and activities that pose a threat to U.S. national security,” Don Fort, internal revenue service-criminal investigation (IRS-CI) chief, said.

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