This is the first time that criminal charges have been made in the United States about of a violation based on a bitcoin transfer. According to The Registera US citizen is accused of transferring the equivalent of $10 million in bitcoins into a “forbidden country”.
First criminal charges for illegal transfer of bitcoins
Under the International Emergency Economic Powers Act, it is illegal for a citizen or institution of the United States to transfer funds, directly or indirectly, to a country under sanctions, such as Iran, Cuba, North Korea, Syria or Russia. It is in this context that several American prosecutors accuse a United States citizen of having illegally transferred more than 10 million dollars in bitcoins to a country hit by economic sanctions.
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It was Zia Faruqui, an American judge and magistrate from the District of Columbia, Washington DC, who gave the green light to launch an investigation into this man. The US citizen in question is charged with a violation of 18 USC Section 371. This is a significant fact because this is literally the first criminal proceeding committed against an individual who allegedly “knowingly transferred cryptocurrencies to a prohibited country”. According to the court, this case highlights both the potential of this technology to circumvent financial blocks and its traceability by law enforcement.
A false sense of security
The names of the payment gateway as well as the name of the country subject to sanctions concerned. Now, there is no longer any doubt: virtual currencies fall under traditional economic sanctions. According to the American judge, “the question is no longer whether virtual currency is here to stay, but rather whether regulations will keep pace with blockchain”. The notice also points out that cryptocurrencies are not not as anonymous as some users might think.
In this regard, the accused US citizen proudly stated that the payment platform can circumvent US sanctions by facilitating bitcoin payments. He believes that users of these platforms have been lulled into a false sense of security. In a few months, cryptocurrencies have grown a lot. In March 2022, in the midst of war against Russia, Volodymyr Zelensky even legalized the cryptocurrency industry in Ukraine. The use of crypto-assets has become commonplace and the Securities and Exchange Commission has even announced that it will recruit 20 new investigators to swell the ranks of its surveillance unit.