Using Bank Accounts and MSBs, Digital Currency Company Laundered $6 Billion, Say Prosecutors

By Colby Adams

The alleged money laundering of $6 billion through bank accounts controlled by a virtual currency operator and its accomplices reflects widespread and serious anti-money laundering vulnerabilities, say industry experts. On Tuesday, the Southern District of New York accused the owners of Costa Rica-based Liberty Reserve of marketing its digital currency to criminals who transferred dirty money across borders with virtually no oversight. The operation exploited a network of unlicensed, offshore money transmitters who offered the use of their bank accounts to the currency's users, prosecutors said in a 27-page indictment. The release of the previously sealed indictment coincided with the...