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Florida Arrests High-Dollar Bitcoin Exchangers For Money Laundering
tsu doh nimh writes "State authorities in Florida on Thursday announced criminal charges targeting three men who allegedly ran illegal businesses moving large amounts of cash in and out of the Bitcoin virtual currency. Experts say this is likely the first case in which Bitcoin vendors have been prosecuted under state anti-money laundering laws, and that prosecutions like these could shut down one of the last remaining avenues for purchasing Bitcoins anonymously."
How is this news?
I bet Beta is a money laundering scheme. Florida authorities should be notified.
As to the topic itself, of-course the gov't sees Bitcoins and thinks 'money laundering'. Don't you know? All money belongs to the government, they can't stand the thought of people figuring out this whole freedom thing, what if the people realise they don't actually have to pay taxes en mass and simply don't pay. What happens when everybody simply stops paying?
You can't handle the truth.
The bigger crime here is slashdot beta. Even worse than the "Business Intelligence" dashboard.
Please post this to new articles if it hasn't been posted yet. (Copy-paste the html from here so links don't get mangled!)
On February 5, 2014, Slashdot announced through a javascript popup that they are starting to "move in to" the new Slashdot Beta design. Slashdot Beta is a trend-following attempt to give Slashdot a fresh look, an approach that has led to less space for text and an abandonment of the traditional Slashdot look. Much worse than that, Slashdot Beta fundamentally breaks the classic Slashdot discussion and moderation system.
If you haven't seen Slashdot Beta already, open this in a new tab. After seeing that, click here to return to classic Slashdot.
We should boycott stories and only discuss the abomination that is Slashdot Beta until Dice abandons the project.
We should boycott slashdot entirely during the week of Feb 10 to Feb 17 as part of the wider slashcott
Moderators - only spend mod points on comments that discuss Beta
Commentors - only discuss Beta
http://slashdot.org/recent - Vote up the Fuck Beta stories
Keep this up for a few days and we may finally get the PHBs attention.
-----=====##### LINKS #####=====-----
Discussion of Beta: http://slashdot.org/firehose.pl?op=view&id=56395415
Discussion of where to go if Beta goes live: http://slashdot.org/firehose.pl?op=view&type=submission&id=3321441
Alternative Slashdot: http://altslashdot.org (thanks Okian Warrior (537106))
"Coin Wash Laundry" ...and how many times has one been a front for a counterfeit puppy sex change massage parlor bag drop underground railroad safe house, after all.
Duh !!
Crack pipe !!
Crack addict !!
Duh !!
Hoe !!
Pimp !!
Prostitution !!
Beta !!
Slashdot !!
Pile o'shit !!
Fuck BETA and the horse it rode in on.
I would make a case for entrapment. If anyone comes to you and says something along the lines of, "I've got some drug money to launder, I need $30,000 in bitcoins..." don't say yes. I mean, Jesus Christ, how fantastically stupid do you have to be to go for that?! Still, law enforcement is breaking the law when they create crimes to arrest people for. Beyond that, unless they're going to make private money transactions illegal, this case doesn't really mean anything for the bigger picture.
This signature has Super Cow Powers
Rolling Slashdot Beta in Florida is against the law and will be punishable to the maximum penalty allowed by the local law.
Long live the FUCK BETA!
It's law enforcement, so they get to break the law whenever they want to, even if it means slaughtering someone in full view of online media (Fullerton, CA). If the existing law fails them, they can use made-up economic crimes like "money laundering," which is nothing but the legal term for trading in cash.
Yeah I agree. It should mpt be a crim for people to do what they wish with their money. So unless they willingly take in money they knew was from drugs or something ilegal then there should NOT be a case.
If someone comes up to your business and says "hey i'm going to use this for illegal purposes", and then you agree to accept the money, you're in violation of several laws. RICO is one, and so is money laundering in some cases. His biggest mistake was at the point when they said what they were going to use the money for, in this case to buy stolen credit cards online, he accepted the deal and continued working with them. He should have said that he doesn't do anything illegal and not dealt with the potential customer at that point. That would have shielded him from liability.
The entire 'barter system' scares governments as they cant track and tax it. Things like bitcoin will be crushed, one way or another.
They also are not keen on regular currency, for similar reasons.
---- Booth was a patriot ----
Awww did the open source fags get popped? Yes they did - suckers!
What the hell are you talking about - you miserable, self-hating faggot?
From the dawn of bulletin boards, operators have been besieged by faithful users every single time the interface was overhauled. Yet nearly as many times, within a few months of the new interface nobody can even imagine those dark, dark days of being forced to use the prior one.
You need to embrace the future to continue to be a part of it. Sometimes you even need to get a step or two ahead of it. Beta represents movement in that direction, and on reflection could probably use a few additional enhancements to appeal to a new user base:
It's like peeling off an exceptionally large bandaid. You should do it fast, without complaint, and maybe with the help of a few friends. Things will be back to normal before you know it.
We are Dice. Lower your standards and surrender your community. We will add all your story submissions and any associated posts to BETA. Your culture will adapt to service us. Resistance is futile.
It depends on how law enforcement first came into contact with those that were arrested. The article is somewhat ambiguous about how these guys came to the attention of law enforcement. It does appear that the only real crime these guys committed was being "unlawful money transmitters", which seems like a crime that should not exist to me. When the undercover agent told them that they wanted the bitcoins in order to do something illegal, they should have told them, "Sorry, I will not do business with you." Not because I think that they should legally have to care, but because people who genuinely want bitcoins to do something illegal are not likely to tell you that. This suggests that the person who is telling you his reasons is something other than someone who wants to conduct a transaction. It also seems likely that the reason they presented that they wanted to use the bitcoins for something illegal was because they doubted a jury would have convicted the men on the "unlawful money transmitters" charge.
Ultimately, I do not know if this was entrapment by the legal definition, but it does seem like a waste of law enforcement resources.
The truth is that all men having power ought to be mistrusted. James Madison
We are ONAC. We demand that you keep Slashdot the way it is. The way that WE like it! By the way, get off our lawns!
This is a sincere question... not a challenge to the usefulness or benefits of bitcoin, but just a question that, if bitcoin is to really have any kind of future, I think that people who *are* law abiding and might want to use it someday really need to understand.
File under 'M' for 'Manic ranting'
I would make a case for entrapment.
If you step into trap willingly, it ain't entrapment.
Still, law enforcement is breaking the law when they create crimes to arrest people for.
This is beyond stupid.
Money laundering has been practiced for over 6000 years, but the term itself comes from the prohibition era of American history.
money laundering
I see a lot of the comments so far are about how stupid it was to go through with the transaction after it was mentioned that the buyer was going purchase illicit material with it.
However, as I understand it from Krebs' post - and the Florida law in question - that doesn't necessarily factor into it. The law seems to state that as soon as you act as a money transmitter, and the exchange is between $300 and $20k within a 12 month period, without being licensed to do so makes you liable for a third degree felony.
Some questions I would have for a lawyer that actually knows the ins&outs of Florida state law in this field:
1. Is the above, in fact, the case? I.e. are the charges on those accounts completely unrelated to the disclosure of what the purchased material (in this case, Bitcoin) would be used for?
2a. Does that mean that the state of Florida sees Bitcoin as a currency?
2b. If it does not, then how would this same law be applied to e.g. physical goods if used as a material for exchange (e.g. gold nuggets, diamonds, etc.)
3. Would similar apply to a travelers going in opposite directions exchanging their currencies when the value exceeds $300 (something easily possible if you forget to empty out your wallet), rather than going through the official exchange bureaus at the airport (and incurring the rather hefty exchange fees)?
If anyone comes to you and says something along the lines of, "I've got some drug money to launder, I need $30,000 in bitcoins..." don't say yes. I mean, Jesus Christ, how fantastically stupid do you have to be to go for that?!
On the other hand, one has to be fantastically naive to expect a similar magnitude of business from people who only want to buy a cup of coffee at Starbucks. BTC attracts criminal proceeds like honey attracts flies. In essence, there is hardly any legal use of BTC (outside of pure speculation and experiments.)
One would be better off buying that TV or that subscription with an inflating currency than with a deflating one. Credit cards also give you insurance, and protection, and a small kickback, and a grace month during which you own the item but haven't paid for it yet.
The new Slashdot design is based on Windows 8. That fact alone, even aside from the numerous usability issues, indicates that the new owners have no fucking idea in the world what they've acquired.
Slashdot is a technology site, a geek site, an open source site, a programming site, an Internet / Web advocacy site. But more than that, it is a Linux community site. It lives and dies by its community. That community, by and large, is made up of passionate Linux advocates who can be whipped into a frenzy at the mention of Microsoft, who think Bill Gates is the Great Satan, who sincerely believe in free and open source software, and who implement that passion in their lives, hobbies, and jobs. Sure, not everyone here fits the mold. But that's the core of the community.
As one single data point, I work on simulators in the aerospace segment. We develop and integrate specialized, whole-system, software-only simulators, supporting software development when the hardware has limited availability or hasn't been built yet. Our user community is not large, but includes key technical people at well known organizations. Like others we interface with, our work has gone from Windows and Linux in the beginning, to mostly Linux, plus Windows if we have to. That's how we like it. Linux works for us - it's developer friendly, it's rock solid, it's quite deployable, and it lets us do what we need to do. And a bunch of us come to Slashdot to catch the news on Linux and other geek-worthy subjects, and discuss it with others.
And now the owners, having acquired this rather unique and valuable site, want to make it into Windows fucking 8 - the friendly, cuddly, but unusable Fisher-Price operating system that represents everything we despise? The mind reels. You might as well just make it a SEO parking page for Microsoft.
Seriously, DICE, do not do this thing. I know you don't care about the history, community, or shared values of this site, but this move will destroy them, and take the site with it. It will become a ghost town, abandoned by its residents, only visited by tourists and people that got lost on their way somewhere else.
I would make a case for entrapment.
If you step into a trap willingly, it ain't entrapment.
Still, law enforcement is breaking the law when they create crimes to arrest people for.
This is beyond stupid.
The elements of the crime of money laundering are set forth in the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances and Convention against Transnational Organized Crime. [2000] It is defined as knowingly engaging in a financial transaction with the proceeds of a crime for the purpose of concealing or disguising the illicit origin of the property from governments.
Criminalizing money laundering
Money laundering has been practiced for over 6000 years, but the term itself comes from the prohibition era of American history.
money laundering
unless they're going to make private money transactions illegal, this case doesn't really mean anything for the bigger picture
[Cash for legal purposes is defined as any] transaction in which the recipient knows the payer is trying to avoid the reporting of the transaction on Form 8300.
FAQs Regarding Reporting Cash Payments of Over $10,000 (Form 8300)
Still, law enforcement is breaking the law when they create crimes to arrest people for.
It happens all the time, the best example being the "To Catch a Predator" type stings. Law Enforcement create a situation, a honeypot if you will, and waits for the flies. Fake pawn shops for fencing stolen goods is another example. Cops have also been known to encourage murder-for-hire in domestic situations like messy divorces.
But like this Bitcoin thing, "entrapment" is not legally defined the way most people suppose it is... In criminal law, entrapment is when a law enforcement agent induces a person to commit an offense that the person would have otherwise been unlikely to commit. They seem to get around it by supposedly providing opportunities to walk away. But like a fat person in front of a table piled high with Little Debbie's, it usually works out for the cops...
If you want news from today, you have to come back tomorrow.
If you want to buy Euros, you'll have to go to an exchange bureau
Not true. At least not universally true.
As long as the dollar-value is small and there's not some other crime, like fraud or misrepresentation going on, nobody is going to care. If I come back from a trip to Europe with a pocket full of Euros and sell them to a friend who is about to go there himself, I dare the Feds to arrest us for money-laundering. If they tried, it would be a public-relations nightmare.
Heck, some local ethnic-oriented businesses even advertise that they "accept [insert non-US currency here]." Of course, the exchange rate is very favorable to them and as a result there is very little in the way of "selling goods for [insert currency here]" going on.
Captcha: exchange
Tell me the last time you heard a cash story that wasn't about money laundering or counterfeit cash
The last "cash" story I heard was about a homeless guy who turned in a bag or wallet or something full of cash to the police. The rightful owner was very grateful.
This was in the last few weeks. And yes, I am in the USA.
Captcha: charity
It is the people who ruin every single discussion and make it about the beta. Sites change and evolve get over it.
Cops have also been known to encourage murder-for-hire in domestic situations like messy divorces.
Wait, wha?.. How does that even work? Got pointers on further reading about that? Should be an interesting read.
How can you nonchalantly push someone towards hiring an assasin in case like this - and prove afterwards that there was gonna be murder anyways even if you didn't push them?
can we kill the statist fuck who modded this troll?
Something tells me 'tsu doh nimh' is a pseudonym.
Wait, wha?.. How does that even work? Got pointers on further reading about that? Should be an interesting read.
I should have been more specific: The under-cover cop encourages the perp to hire the under-cover cop to kill the spouse. Quite common with these sorts of crimes.
If you want news from today, you have to come back tomorrow.
I've typed comments out durring lunch that took a moment to revise and after posting and checking on it later.. it doesn't even show existing. WTF. so frustrating, it makes me feel you slashdotters live in such a closed universe you can parse out the hethen brogrammers like me when we toss our two cents.
maybe it's just me and not slashdot
but fuck it, and fuck beta! This looks like crap. there is too much space all around and no info. why this beta look like a wordpress anyway? cmon! and it's too bright here
Oh, ok, now that makes sense. Finding it was easy now, too.
For those looking, searching "undercover cop+divorce" gives plenty of hits about that case, and even a candid video of negotiations.
In case your anyone forgot to tell you. I someone asks if thou art a god you say yes.
If someone ask will you commit a crime if I pay you money you say no.
Lots of trolling here, but I'll try to refute the basics.
The new Slashdot design is based on Windows 8.
Not at all. You're just taking something that's unpopular with the users of this website (certainly not representative of the whole Windows user base) and making an unsupported coloration between the two. If anything, the new Slashdot beta is based on your typical Linux Desktop environment. Poorly organized, with lots of unused space scattered around, and not very functional.
But more than that, it is a Linux community site.
Ehh, fuck off. Yes, there are a large number of Linux zealots that infest this site, but they are NOT the community itself. The Linux zealots abuse the moderation system to support their trolling and have always been the dark side of Slashdot. If the new Beta drives them away, nothing of value was lost.
Seriously, DICE, do not do this thing
Again, and I say this proudly, GO FUCK YOURSELF, ASSHOLE. You've made it clear you're part of the GNU/FREETARD faggot brigade. Find a new place to spread your filth and circle-jerk with your "community" somewhere else.
From the article;
and Florida’s anti-money laundering statutes, which prohibit the trade or business in currency of more than $10,000.
This is factually incorrect, The satute does not prohibit the transaction, it just requires reporting. This makes me believe that the dealer was charged under 869.102 which mentions "trade or business". Had it been 869.101 them the source of the money would have come into relevance.
The money laundering statute, Title XLVI Chapter 869 section 102, is about reporting.
All persons engaged in a trade or business, except for those financial institutions that report to the Office of Financial Regulation pursuant to s. 655.50, who receive more than $10,000 in currency, including foreign currency, in one transaction, or who receive this amount through two or more related transactions, must complete and file with the Department of Revenue the information required pursuant to 26 U.S.C. s. 6050I., concerning returns relating to currency received in trade or business.
If the bitcoin seller did not collect enough information to fill out the form and report the transaction so he was arrested. The law does not care if the money came from legal or illegal sources. If you don't report the transaction you have broken the law.
It means that the federal government is serious about treating bitcoins as a real currency. Which means that if you're an exchange you better file suspicious activity reports and comply with all the legislation and if you're an individual you better pay taxes on whatever you own. It's going to be incredibly difficult to convert bitcoins from anything like silk road into US dollars because you're going to get reported to the government at some point along the way.
It also means that pretty soon that anyone doing legitimate business in Bitcoin is going to be identifiable in the transaction history, which is going to be kind of interesting and make the feds wet themselves with glee. Bitcoin is not anonymous, it was only anonymous because the exchanges weren't following the law.
Hoist with your own petard!
I do not see how they can bust someone for money laundering when BitCoin isn't even considered a valid currency, under US law. And the Feds have continued to use illegal, and entrapment tactics, and they continue to get away with it.
Im sure some lawyers will figure out a way to ruin the feds case, the feds have always been morons and tried to destroy anything that gives people any "real" or "true" freedom.
It is broken.
Get rid of beta ffs, we don't want it.
Which is it, dollars or bitcoin???
Seems the concept is so new that the language hasn't caught up yet.
You don't launder your money by hiding who gave and received dollars. That's how you get the government all over you.
Rather, you anonmymize the bitcoins. Very simply... they buy bitcoins for dollars. You log everything in compliance with all their stupid laws.
Then you have everyone randomly swap bitcoins with each other so its impossible to know who got which ones.
Will the government still know you received some money? Sure. Good luck hiding that in any case. But this way at least they won't know where it came from or what you bought.
I've decided to stop wasting my time responding to AC trolls/sockpuppets... so if you want a response from me... login.
Once you have bitcoins, it's not hard to transfer them to another address. Who owns that address? Consider also coin tumblers and similar schemes. This is what laundering is about after all. Moving money around to disguise its provenance.
Still, who would use Bitcoin when you can just launder your money through a large bank who will only receive a slap on the wrist when caught?
Money laundering is not about hiding the fact that you have money - because you could just bury it in a chest somewhere, or in a case of Bitcoin receive it in a new adress - it's about providing a legitimate-looking origin for what you use. Coin tumblers don't help with that, they just make it harder to connect a particular transaction directly to another transaction.
Basically, when you buy a mansion, you can't do so with money from your cocaine sales, but must instead use money from your inexplicably succesful pet email webshop. Who buys all those pet emails, and where does their money come from? Beats you, you just get some Bitcoin and send an email to the address given. Surprised you too that it got so popular. Must be some weird hipster trend or something. Tacky, but perfectly legal. The money is yours fair and square, and so is the mansion.
Forget magic. Any technology distinguishable from divine power is insufficiently advanced.
"No, people with a dictator complex like the thought of creating something unaccountable to government, i.e. unaccountable to the people."
1. logical fallacy. Government is supposed to represent the people. But unless you are completely ignorant you realize that doesn't always work out so well...
2. In reality it would be more the definition of a rebel rather than a dictator. The dictator is the one who wants surveillance of everything.
The coins are traceable, but since anyone can make a new wallet at any time and transfer from himself to himself, use VPNs and so on.
no, thats you guys
Barter system also dilutes govt hegemony.
Casteism