Tornado Cash Developer Sentenced for Money Laundering

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Alexey Pertsev, the developer behind Tornado Cash, has been convicted of money laundering and sentenced to 64 months in prison by a Dutch Juge at s-Hertogenbosch court. According to a report, he must stay in prison until a suitable correctional facility in the Netherlands is located for his offense. Also, Pertsev has the right to appeal his sentence.

Tornado Cash Leaders in Chaos

Recall that the Dutch Fiscal Information and Investigation Service (FIOD) arrested 31-year-old Pertsev in 2022 after Tornado Cash was indicted for its involvement in laundering $7 billion worth of funds obtained from illicit activities. Initially, the regulator declared plans to make many arrests connected to the crypto mixer’s crime.

Hence, Pertsev was arrested in the Netherlands. The United States Office and Foreign Assets Control (OFAC) added Tornado Cash and 44 other associated Ethereum (ETH) and USDC wallets to its sanction list. Amongst the listed wallets are the smart contracts that run Tornado Cash and the Tornado Cash donation wallet.

Along with Pertsev, Roman Semenov, and Roman Storm, other co-founders of Tornado Cash were reportedly added to the OFAC database of Specially designated National (SDN) and Blocked Persons. Semenov and Storm are both accused of money laundering, participating in sanctions violations, and attempting to run an unlicensed financial-transmitting business.

Roman Storm Files Motion to Dismiss Charges

In March, the lawyers of the developer and co-founder of the decentralized privacy tool filed a motion to dismiss the charges against him, labeling the indictment as “fatally flawed.” Storm lawyers in the new filing argued that the prosecutor’s attempt to criminalize developing software is unprecedented and violates Storm’s First Amendment rights.

They contend that Storm cannot be held responsible for any illicit use of Tornado Cash, as there are no allegations that he conspired with bad actors who misused the software. However, at the time of their arrest, in the press release issued by the DOJ, U.S. Attorney Damian Williams alleged that Storm and Semenov knew that they were helping hackers and fraudsters conceal the fruits of their crimes.

The DOJ is not Letting go

In the DOJ’s response, the prosecutors explained why the Tornado Cash co-founder should be held accountable for the alleged crimes. Damian Williams and his team of prosecutors claimed that Semenov was responsible for running the cryptocurrency mixer. He was accused of creating systems that helped criminals remain anonymous. Ultimately, they claimed he did not make enough changes to prevent the usage of sanctioned addresses.

The DOJ believes that the defense’s filing brings up disputed facts that should be considered by a jury later on, rather than at this early stage.

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