According to the Ministry of Justice indictment, 53-year-old Maximiliano Pilipis operated the AurumXchange exchange without a license from 2009 to 2013. More than $30 million passed through the platform through 100,000 transactions. Some of these funds came from accounts opened on the Silk Road darknet, where users could anonymously buy drugs and other illicit goods and services. The Ministry of Justice claims that for organizing these transactions, Pilipis earned 10,000 BTC as commission, which at that time was worth about $1.2 million.
Authorities also accused Pilipis of flouting federal registration and reporting requirements for cryptocurrency exchanges. AurumXchange was not registered with the U.S. Treasury Department, and Pilipis did not file reports on the exchange’s activities with the federal government. Additionally, AurumXchange failed to implement Know Your Customer (KYC) procedures, violating Anti-Money Laundering (AML) and Anti-Terrorism Financing (CTF) regulations.
After the closure of AurumXchange, its creator distributed bitcoins and other crypto-assets across various services in order to hide illegally obtained funds. The offender converted cryptocurrencies into US dollars, which he invested in real estate in Arcadia and Noblesville, Indiana. One of Pilipis’ properties in Noblesville is already owned by a bank. Authorities also accused the founder of AurumXchange of tax evasion in 2019 and 2020.
Pilipis faces five charges of money laundering and two charges of willful failure to file a tax return. If the man is found guilty, he faces up to ten years in prison and a fine of up to $250,000.
According to media reports, the US Department of Justice recently accused cryptocurrency market makers Gotbit, ZM Quant, CLS Global and MyTrade of market manipulation and fictitious trading of cryptocurrencies. At the beginning of the year, the US Department of Justice confiscated $150 million in cryptocurrencies from an Indian citizen in a drug trafficking case on the darknet.
Source: Bits
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