Belarusian National Charged for Alleged BTC-e-linked Crypto Laundering

An indictment was unsealed last week, leveling severe charges against a Belarusian and Cypriot national, including operation of an unlicensed money services business and money laundering conspiracy, in connection to BTC-e.

Suspect Held in Custody

42-year-old Aliaksandr Klimenka was arrested in Latvia on Dec 21, 2023, and is currently in custody after his extradition to the US. The suspect allegedly controlled the BTC-e crypto exchange, as well as technology services company Soft-FX and financial company FX Open.

BTC-e, a now-defunct crypto exchange focused on the Russian market, was launched in 2011 and operated until its seizure in July 2017. According to the indictment, BTC-e was allegedly a “significant cybercrime and online money laundering entity” where users could convert crypto funds with a “high levels of anonymity.”

BTC-e Allegedly Facilitated Criminal Activities

Furthermore, authorities believe the platform amassed a customer base primarily involved in criminal activities.

“BTC-e allegedly facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and allegedly was used to facilitate crimes ranging from computer hacking to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking,” reads a US Department of Justice (DoJ) press release.

Operated in The US, Lacked Registration

The platform’s servers, which operated in the US, facilitated most of the illicit schemes unfolded by BTC-e and its operators. They were allegedly “leased to and maintained by Klimenka and Soft-FX,” according to court documents.

Although operating in the US, the platform allegedly hadn’t registered as a money service business with the Department of Treasury. It also had no “know your customer” (KYC) verification and no anti-money laundering program, as required by federal law.

The exchange platform Klimenka operated is alleged to have helped launder more than $4 billion worth of cryptocurrency in the form of criminal proceeds. If found guilty, the suspect could spend up to 25 years in prison.

Crypto and Cybercrime; Protecting Your Assets

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