Liberty Reserve co-founder Vladimir Katz has pleaded guilty to the charges of money laundering and operating an unlicensed money transferring business in front of Manhattan Federal court.
, and have arrested 5 key suspects including founder Arthur Budovsky. Katz who left the outfit in 2009 was picked up by authorities in New York, and was put ahead a court room on charges of conspiracy and money laundering.
Liberty Reserve was a digital currency firm that was linked to underground activities, and was known by federal authorities as the underworld’s bank of choice. The service was used by over 1 million users and completed over 55 million transactions in digital currency. The service has been linked to child pornography, identity theft, computer hacking, credit fraud, and the illegal distribution of narcotics.
“His conviction reinforces what we said when Liberty Reserve was first brought down: banking systems that allow criminals to conduct illegal transactions anonymously will not be allowed to stand, and professional money launderers will be brought to justice.” Acting Assistant Attorney General Mythili Raman added on Katz’s plea.
According to the allegations, Katz is to serve 20 years jail time for his crimes.
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