The US government is
charging a popular online currency exchange with what it claims is the
largest money laundering scheme in history.
Attorneys with the US Southern New York
have charged the operators of Liberty Reserve with trafficking in some
$6bn worth of funds for activities including child pornography,
cybercrime services and financial fraud.
Designed as a secure an anonymous payment
service, Liberty Reserve allowed users to transmit funds
internationally without the need for monetary exchange markets or other
financial institutions. According to attorneys, however, the company
existed almost entirely to facilitate underground transactions for
criminal activity.
“As alleged, the only liberty that
Liberty Reserve gave many of its users was the freedom to commit crimes –
the coin of its realm was anonymity, and it became a popular hub for
fraudsters, hackers, and traffickers,” said US Attorney Preet Bharara.
“The global enforcement action we
announce today is an important step towards reining in the ‘Wild West’
of illicit Internet banking.”
The US court said that it has indicted
five people who are believed to be behind Liberty Reserve, including
individuals based in the US and Spain. Two more individuals, last seen
in Costa Rica, are also being sought as suspects in the case.
This is not the first time Liberty
Exchange has been singled out as a facilitator of underground
transactions. Earlier this month the firm was one of several Bitcoin
operations singled out by security researchers as money laundering fronts for malware sales.
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