The Department of Justice (DOJ) has charged Toronto Cash's founders with counts of money laundering and sanction violations. The cryptocurrency mixer first faced US sanctions last year for allegedly laundering over $7 billion in stolen funds. The DOJ now alleges that Toronto Cash facilitated $1 billion in money laundering, including $455 million funneled through the mixer by a North Korean cybercrime organization, the Lazarus Group. The overall charges include "conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money transmitting business." Co-founder Roman Storm was arrested in Washington State, while the other half of Toronto Cash, Roman Semenov, is still at large.
The US government is attempting to send a strong message about using cryptocurrency for illegal purposes. "These charges should serve as yet another warning to those who think they can turn to cryptocurrency to conceal their crimes and hide their identities, including cryptocurrency mixers: it does not matter how sophisticated your scheme is or how many attempts you have made to anonymize yourself, the Justice Department will find you and hold you accountable for your crimes," Attorney General Merrick B. Garland said in a statement.
If you're unfamiliar, a cryptocurrency mixer is a service that makes it harder to track funds from their origin to the new owner. Most blockchains, like Bitcoin and Ethereum, are visible, so a mixer helps individuals hide their money flow — whether it be for reasonable or illegal activities. Chainalysis, a cryptocurrency analysis firm, found that in 2022, crypto addresses known for unlawful activity used mixers in almost 10 percent of transactions.