Samourai Wallet founders arrested and charged with money laundering worth $ 2 billion on its app. The Samourai Wallet app was used by criminals to transfer funds while concealing their identity. But now the U.S. government is taking action against such apps. Read in further to learn about the arrest in detail.
What Is The Samourai Wallet?
Samourai wallet was a cryptocurrency mixer that helped people keep their transactions private and their identity hidden. It had more than 100,000 downloads of its app on the Google Play Store. Now the app is seized, and the display shows a seizure warrant. The wallet was designed to conceal the financial activities of users and enhance their transaction privacy. The app was launched in 2015, and the founders had openly promoted that their app focuses on censoring the black or grey economy and users can easily launder their criminal proceeds.
Are Samourai Wallet Founders Arrested?
Keonne Rodriguez and William Lonergan Hill, the founders of Samourai Wallet, were arrested and charged with money laundering. Both of them together developed, operated, and marketed a cryptocurrency mixer that facilitated illicit money worth more than $100 million in money laundering transactions from the dark web markets. The Samourai wallet overall facilitated 80,000 BTC, which is over $2 billion, in unlawful transactions over the course of almost 10 years.
The pair knowingly facilitated the criminal proceeds worth $100 million from markets including Silk Road, Hydra Market, and a host of other fraud campaigns and computer hacking. The wallet offers a total of two features for its users to help them conceal their illicit funds transfers. The first feature, which is called Whirlpool, mixes batches of crypto and exchanges them between users to help them prevent the tracing of their funds. The other one, known as hops, allows users to make additional intermediate transactions while sending currencies between the addresses. This helps prevent the FBI and law agencies from identifying if the particular funds are obtained from criminal activities.
Both the founders collected an approximate amount of $4.5 million as fees for their services. Also, different features had different fee structures. The founders are charged with conspiracies of money laundering and operating unlicensed money-transmitting businesses. The charges carry 20 and 5 years of sentence, respectively.
Rodriguez, who is the 35-year-old CEO (Chief Executive Officer), was arrested in Pennsylvania. Lonergan Hill, the 65-year-old CTO (Chief Technology Officer), was arrested on the same day in Portugal and was then extradited to the U.S. The website of the Samourai wallet, hosted in Iceland, was also seized along with its app by the U.S. authorities.
Are The Founders In Jail Now?
Keonne Rodriguez was bailed by the judge on a bond of $1 million as he pleaded not guilty. The bond was secured by real estate in Pennsylvania, along with the signature of his wife and a family member. Rodriguez is not allowed to travel other than traveling to court proceedings and will only remain at home, being monitored by the location tracking technology. He will also not involve himself in any transaction related to cryptocurrencies, especially Bitcoin.
Following in the footsteps of his partner, William Lonergan Hill also contested the charges and was granted bail on a bail package costing around $3 million. He is allowed to live in Lisbon, Portugal, and can only travel for the court proceedings. Hill is also obliged to wear ankle bracelets, which will enable the FBI to monitor his location.
Wrap Up
Samourai Wallet founders arrested as the U.S. government works on eradicating all the cryptocurrency mixing tools. Tools like Samourai Wallets are a hub for criminals to conceal their illegal crypto transactions and money laundering. But this arrest has also raised speculations from users, and they say that privacy is normal and Samourai should receive a defense fund.
