Helix tumbler / bitcoin mixer founder indicted for money laundering

avikz

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Quote from: xtraelv on February 13, 2020, 12:35:42 AM

CLEVELAND, Ohio — A Bath Township man is charged in federal court with running a darknet operation that prosecutors said laundered more than $300 million worth of cryptocurrency often used for illegal transactions in underground marketplaces.

Larry Dean Harmon is charged with conspiracy to launder money instruments, operating an unlicensed money transmitting business and money transmission without a license detailed in an indictment handed up by a grand jury in Washington, D.C. Federal prosecutors say Harmon, 36, ran a service that allowed customers to send bitcoin and obscure its origin. Such services are known as “mixing” or “tumbling.”

Federal prosecutors are seeking millions of dollars in financial penalties and want Harmon to forfeit his house on Yellow Creek Road, as well as additional property in Akron and Aurora, Colorado.

Source: https://www.cleveland.com/court-justice/2020/02/bath-township-man-ran-service-that-laundered-311-million-in-bitcoin-for-darknet-transactions-feds-say.html

Lol! While I understand this fellow was not solely arrested and charged for mixing services, but mixers are a great tool for money laundering no one can deny! The motto of money laundering is to hide trail of dirty money and mixer does exactly that!

Honestly, bitcoin has given financial freedom to a lot of people who are honest and didn't earn bitcoin by felony. But there is another segment of people who were empowered by bitcoin (xmr nowadays) to continue with their dirty practices. The community must find a way to stop this menace!

pealr12

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Aside from being the head of a mixing service which doesn't seem right (as it is highly likely that criminals will use that service to mix the btc they stole from others) in the first place, he is involved in money laundry which is a big crime, he most probably use this service for his laundry activities as well, and for him to plead guilty just make things worse i suppose, i guess now all eyes will be on rest of this mixer services out there.

Daltonik

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The founder of the Helix cryptocurrency mixing service and CEO of Coin Ninja, Larry Dean Harmon, pleaded guilty to laundering more than $300 million, he faces up to 20 years in prison and multimillion-dollar fines. Harmon pleaded guilty to laundering more than 350,000 BTC through Helix between 2014 and 2017. Harmon has already had 4,400 BTC confiscated during the proceedings in this case. https://www.justice.gov/opa/pr/ohio-resident-pleads-guilty-operating-darknet-based-bitcoin-mixer-laundered-over-300-million

Quote from: https://twitter.com/TheJusticeDept/status/1428044891582521350

figmentofmyass

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Quote from: bbc.reporter on February 15, 2020, 11:08:12 PM

The department of justice should state clearly on what for them is a partnership and how they arrived on their classification that Alphabay and Helix are define partners.

i'm sure we'll get all the nitty gritty details in time, but we can already infer the basics from the law. a "conspiracy to launder money" charge has very specific requirements:

Quote

A conspiracy is an agreement between two or more people to join together to attempt to accomplish some unlawful purpose. It is a kind of "partnership in crime" in which each member becomes the agent of every other member.

https://www.justice.gov/archives/jm/criminal-resource-manual-2167-jury-instruction-conspiracy-18-usc-1956h

the charge requires both explicit agreement among the accused and willful intent to commit a crime. importantly, guilt by association alone is not incriminating:

Quote

One does not become a member of a conspiracy through an association with members of the conspiracy or by the mere knowledge that a conspiracy exists.

....so merely transacting with DNM admins/users in the ordinary course of business (even knowingly) does not meet the requirement for a conspiracy charge.

hatshepsut93

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Quote from: gentlemand on February 15, 2020, 12:20:48 PM

Anything centralised is likely to feel some major heat at some point relatively soon.

It's very likely that mixers already quietly work with investigators, otherwise we would have heard more of this kind of stories.

I get how people see this indictment as a sign that the government wants to outlaw privacy tech, but there's were always people with power who wanted to do so - there were attacks on end-to-end encryption and personal encryption, but in the end it's nowhere near getting banned, at least in the western world.

bbc.reporter

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Quote from: mk4 on February 15, 2020, 05:44:35 AM

Quote from: bbc.reporter on February 14, 2020, 07:26:48 PM

@mk4. Helix might have been advertised on Alphabay as the only recommended mixer by the darknet market site.

Yea, but it was worded as "partnered". There's a significant difference between a service simply being recommended, and both parties actually being affiliated with each other by either literally working together on something, or by paid advertising. For instance I can recommend Coinbase, but it doesn't automatically mean I'm partners with them.

Agreed. The department of justice should state clearly on what for them is a partnership and how they arrived on their classification that Alphabay and Helix are define partners.

This is good, however. This might not be upheld.

dothebeats

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Cashback 15%

Quote from: mk4 on February 15, 2020, 05:44:35 AM

Quote from: bbc.reporter on February 14, 2020, 07:26:48 PM

@mk4. Helix might have been advertised on Alphabay as the only recommended mixer by the darknet market site.

Yea, but it was worded as "partnered". There's a significant difference between a service simply being recommended, and both parties actually being affiliated with each other by either literally working together on something, or by paid advertising. For instance I can recommend Coinbase, but it doesn't automatically mean I'm partners with them.

I'm starting to think that any mixing services being advertised by some darknet marketplaces would likely get targeted by the Feds. I'm still quite unsure as to how the word 'partnered' fits between the relationship of AlphaBay and the accused, but I guess we'll hear more from them as the case proceeds. Anyway, the status of mixing services legally is still a shaky road. Even though there are methods to trace cryptocurrency transaction flows, mixing services have a way to further dilute the trail and make it as if one reached a dead end, and the feds don't like that one bit.

Quote from: gentlemand on February 15, 2020, 12:20:48 PM

The only opinion that matters is that of those who make the laws.

I hate how true this statement is.

gentlemand

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Welt Am Draht

Quote from: Tipstar on February 15, 2020, 11:38:59 AM

There are many opinions about the legality of coin Mixers and I love to compare them with guns.
Just like guns, mixers are just a tool. The one that makes it should not be made liable for what the users do with it.
And though some users use it to launder there money, many others might be doing it as a hobby or just for fun.

The only opinion that matters is that of those who make the laws.

Decentralised options like coinjoin will always likely be fine. It's not as if you can stop them. However we are seeing exchanges starting to get weird about coins that have been through them when they can identify them.

Anything centralised is likely to feel some major heat at some point relatively soon.

Tipstar

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Smart World Global Token

There are many opinions about the legality of coin Mixers and I love to compare them with guns.
Just like guns, mixers are just a tool. The one that makes it should not be made liable for what the users do with it.
And though some users use it to launder there money, many others might be doing it as a hobby or just for fun.

mk4

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Paldo.io 🤖

Quote from: bbc.reporter on February 14, 2020, 07:26:48 PM

@mk4. Helix might have been advertised on Alphabay as the only recommended mixer by the darknet market site.

Yea, but it was worded as "partnered". There's a significant difference between a service simply being recommended, and both parties actually being affiliated with each other by either literally working together on something, or by paid advertising. For instance I can recommend Coinbase, but it doesn't automatically mean I'm partners with them.

bbc.reporter

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@mk4. Helix might have been advertised on Alphabay as the only recommended mixer by the darknet market site.

@squatter. It also appears that we should be careful. We might not be safe from something that we did years ago in the cryptospace.

In any case Coininja was owned by Larry Harmon and Coinninja invested $2 million in Bitrefill according to Crunchbase. What might this imply for Bitrefill?

squatter

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STOP SNITCHIN'

Quote

Federal prosecutors say Harmon’s operation, called Helix, partnered with the online underground marketplace AlphaBay to provide money laundering for customers who accessed the marketplace through the darknet, which is not accessible through internet browsers used by most of the public.

Quote

He is alleged to have run a mixing service called “Helix” that worked in conjunction with AlphaBay – one of the leading so-called “darknet marketplaces” accessible only via Tor browser...Helix also worked with a handful of other marketplaces, the indictment said.

The feds seem to be alluding to direct relationships between Harmon, AlphaBay, and other darknet marketplaces. I wonder if (and to what extent) that plays a role here. The narrative they are painting is reminiscent of the case against Charlie Shrem.

Running a mixer from inside the United States is probably never a good idea, but my interpretation is that their case is stronger than that.

AlphaBay was shut down almost 3 years ago. The fact that this indictment was unsealed just a few days ago indicates the insanely long timelines US agencies work on. They spend years building these cases. Shocked

mk4

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Larry Harmon was most probably not arrested solely due to running a mixing service. The difference of this case to other mixers, is that apparently, this mixer is "partnered" with AlphaBay. Not sure what the word "partnered" specifically means in this case though. Not sure if it's misleading or if they actually collaborated.

From: https://www.scribd.com/document/446772557/Harmon-Indictment#from_embed

Also, for more information about this case, take a look at Peter McCormack's recent tweet thread: https://twitter.com/PeterMcCormack/status/1227755117325291520

xtraelv

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฿ear ride on the rainbow slide

CLEVELAND, Ohio — A Bath Township man is charged in federal court with running a darknet operation that prosecutors said laundered more than $300 million worth of cryptocurrency often used for illegal transactions in underground marketplaces.

Larry Dean Harmon is charged with conspiracy to launder money instruments, operating an unlicensed money transmitting business and money transmission without a license detailed in an indictment handed up by a grand jury in Washington, D.C. Federal prosecutors say Harmon, 36, ran a service that allowed customers to send bitcoin and obscure its origin. Such services are known as “mixing” or “tumbling.”

Federal prosecutors are seeking millions of dollars in financial penalties and want Harmon to forfeit his house on Yellow Creek Road, as well as additional property in Akron and Aurora, Colorado.

Source: https://www.cleveland.com/court-justice/2020/02/bath-township-man-ran-service-that-laundered-311-million-in-bitcoin-for-darknet-transactions-feds-say.html

Topic: Helix tumbler / bitcoin mixer founder indicted for money laundering (Read 264 times)