Washington
DOJ charges Russian founder of cryptocurrency exchange
WASHINGTON (AP) — A Russian national who founded a cryptocurrency exchange that evaded U.S. regulations and became a haven for the proceeds of criminal activity has been arrested, federal officials said Wednesday.
Anatoly Legkodymov, who lives in China, was arrested Tuesday night in Miami and was due in court on a charge of conducting an unlicensed money transmitting business.
Prosecutors allege that Legkodymov’s China-based cryptocurrency exchange, Bizlato Ltd., of which he served as majority owner, did not implement required anti-money-laundering safeguards and required only minimal identification from its users, even permitting them to supply information belonging to “straw man registrants,” people serving as cover for the users.
The Justice Department said Bizlato, either directly or through its intermediaries, conducted more than $700 million in cryptocurrency exchanges with users of Hydra Market, a darknet marketplace for drugs, fake identifications and other illegal products.
“Operating offshore or moving your servers out of the continental U.S. will not shield you,” Deputy Attorney General Lisa Monaco said at a Wednesday news conference. “And whether you break our laws from China or Europe, or abuse our financial system from a tropical island, you can expect to answer for your crimes inside a United States courtroom.”
Monaco’s mention of a tropical island seemed to be an apparent reference to the arrest last month in the Bahamas of Sam Bankman-Fried, the former CEO of failed cryptocurrency firm FTX.
The charge Legkodymov faces carries a maximum penalty of five years in prison upon conviction. Legkodymov, 40, was in custody Wednesday, and it was unclear if he had a lawyer who could comment on his behalf.
Asked at the news conference if Bizlato had assisted Russia in evading sanctions tied to its invasion of Ukraine, Deputy Treasury Secretary Wally Adeyemo said, “What we do know is Russia has set up an ecosystem that is permissive for cyber criminals.”
The Treasury Department’s Financial Crimes Enforcement Network and French authorities worked together to identify the alleged criminal activities by Bizlato, which U.S. officials said was a sign of the global cooperation to purge bad actors from cryptocurrency markets.
Massachusetts
Man charged with trying to hire person to kill wife
BOSTON (AP) — A Boston man offered to pay a total of $8,000 to someone he thought was a contract killer, but who was actually an undercover federal agent, to have his estranged wife and her new boyfriend killed, prosecutors said Wednesday.
Mohammed Chowdhury, 46, was held at an initial hearing on a murder-for-hire charge in federal court on Tuesday pending a detention hearing scheduled for Friday, the U.S. attorney’s office in Boston said in a statement.
An email seeking comment was left with his federal public defender.
Authorities were tipped off by an informant in November that Chowdhury was soliciting assistance to have his wife killed and the informant provided his phone number to law enforcement, prosecutors said.
An undercover agent posing as a contract killer then contacted him, authorities said.
Chowdhury met with the undercover agent and agreed to pay $4,000 per killing, prosecutors alleged.
He provided the agent with photographs of his wife and the boyfriend, told them where they lived and worked, and provided their work schedules, prosecutors said. He was apprehended Tuesday when he allegedly paid a $500 deposit.
Chowdhury told agents his wife wouldn’t let him see his children and he wanted the killings to look like a beating and robbery, prosecutors said.
Illinois
Lawsuits challenge recent semiautomatic gun ban
SPRINGFIELD, Ill. (AP) — Legal challenges to Illinois’ semiautomatic weapons ban began Wednesday with a federal complaint that the 8-day-old law prohibits “commonly possessed” and constitutionally protected guns. A state court pleading was also filed Wednesday, questioning the law’s exemptions based on a person’s employment.
The state lawsuit seeks a temporary restraining order to stop enforcement of the law, which was inspired by the mass shooting that killed seven and injured 30 at the Highland Park July Fourth parade. The lawsuit was filed by Accuracy Firearms of Effingham, about 100 miles (60 kilometers) northeast of St. Louis, and other plaintiffs. The law bans dozens of specific types of rapid-fire handguns and rifles, .50-caliber guns, attachments and limits cartridges to 10 rounds for long guns and 15 rounds for pistols.
An emergency hearing on the restraining order was scheduled for Wednesday morning in Effingham County Circuit Court. Attorney Thomas DeVore, last fall’s unsuccessful Republican candidate for Illinois attorney general, said the law is unconstitutional because of its exemptions. The ban on semiautomatic weapons does not apply to people in certain positions, such as prison guards or other law enforcement officers.
“It violates the equal protection clause because it carves out a whole section of people,” DeVore said. “They are free to do what they will based on their employment.”
Jordan Abudayyeh, spokesperson for Gov. J.B. Pritzker, who signed the law Jan. 10, said the Democrat is confident of its constitutionality and accused opponents of grandstanding.
“This legislation was the result of hundreds of hours of collaboration and cooperation between legal experts, legislators and advocates and it makes Illinois a safer place for every resident,” Abudayyeh said in a statement. “Despite political grandstanding from those more beholden to the gun lobby than to the safety of their constituents, this law is in effect and protecting Illinoisans from the constant fear of being gunned down in a place of worship, at a parade, or on a street corner.”
Dane Harrel, a southern Illinois gun store owner, is the lead plaintiff in the federal test of the ban. Backed by the Illinois State Rifle Association and two other nonprofit gun rights groups, Harrel contends that the new law unconstitutionally bans commonly used weapons, not dangerous or unusual guns, which is the only justification for government regulation, according to the landmark 2008 Supreme Court case known as Heller.
“The rifles that Illinois bans as ‘assault weapons’ are, in all respects, ordinary semiautomatic rifles,” the lawsuit states. “To the extent they are different from other semiautomatic rifles, their distinguishing features make them safer and easier to use. But even if they are considered as a separate group of ‘assault weapons,’ they cannot be banned because they are not dangerous and unusual.”
The lawsuit was filed in U.S. District Court for the Southern District of Illinois, where gun rights advocacy is strong. The federal court’s northern district base is Chicago, where gun violence produces a much stronger attitude toward regulation.
