An Ohio man who was fined $60 million last year for violating anti-money laundering laws pleaded guilty Wednesday to moving hundreds of millions of dollars in cryptocurrency on behalf of dark web marketplaces.
Larry Dean Harmon, 38, admitted to running Helix—a cryptocurrency mixer or tumbler that allowed customers to send bitcoin in a way that concealed their ownership—from 2014 to 2017, according to court documents. Helix partnered with various dark web markets, including AlphaBay, Cloud 9, and Evolution, to provide tumbling services to their customers.
Mixing services generally charge a fee to pool together large amounts of funds from various owners, “mix” the funds together, and distribute it back out to destination addresses, which makes it difficult to trace digital coins back to their original owners. Prosecutors said Helix moved over 350,000 bitcoins, which amounted to more than $300 million at the time of the transactions.
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) levied a $60 million civil money penalty against Harmon in October for violations of the Bank Secrecy Act, such as failing to register as a money services business, failing to implement and maintain an effective anti-money laundering program, and failing to report suspicious activities.
Harmon agreed to forfeit more than 4,400 bitcoins (about $200 million) and other seized property as part of his plea agreement. He faces up to 20 years in prison.
“Criminals may think they can mask financial transactions by using services like Helix to conceal the source of illicit funds,” said Calvin Shivers, assistant director of the FBI’s Criminal Investigative Division. “The FBI and our state, local, federal and international law enforcement partners are working together every day in a complex and ever-changing digital environment to protect the American people from sophisticated money launderers and financiers.”
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