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Bitcoin Not Money, Rules Miami Judge In Dismissing Laundering Charges (miamiherald.com)

Posted by BeauHD on from the make-believe dept.

An anonymous reader quotes a report from Miami Herald: Bitcoin does not actually qualify as money, a Miami-Dade judge ruled Monday in throwing out criminal charges against a Miami Beach man charged with illegally selling the virtual currency. The defendant, Michell Espinoza, was charged with illegally selling and laundering $1,500 worth of Bitcoins to undercover detectives who told him they wanted to use the money to buy stolen credit-card numbers. But Miami-Dade Circuit Judge Teresa Mary Pooler ruled that Bitcoin was not backed by any government or bank, and was not "tangible wealth" and "cannot be hidden under a mattress like cash and gold bars." "The court is not an expert in economics, however, it is very clear, even to someone with limited knowledge in the area, the Bitcoin has a long way to go before it the equivalent of money," Pooler wrote in an eight-page order. The judge also wrote that Florida law -- which says someone can be charged with money laundering if they engage in a financial transaction that will "promote" illegal activity -- is way too vague to apply to Bitcoin. "This court is unwilling to punish a man for selling his property to another, when his actions fall under a statute that is so vaguely written that even legal professionals have difficulty finding a singular meaning," she wrote. Espinoza's case is believed to be the first money-laundering prosecution involving Bitcoin.

3 of 150 comments (clear)

  1. Even if you disagree with the judge . . . by mmell · · Score: 5, Interesting
    . . . (which I don't, by the way) . . .

    let me get this straight - if someone offers to sell me something of value, if I somehow become aware of intended wrongdoing on their part - say, they've said they're raising money to hire a hit-man, or they're planning on buying a couple kilos of tar opium, whatever - I may not complete my transaction with them despite the legality of our specific transaction because I suspect they may use their gains in an illegal manner? In effect, I must deprive them of their lawful right to seek to do business with me without due process of law.

    Does this mean contributors to political campaigns are lawfully culpable for the potentially illegal actions of the political candidates?

    1. Re:Even if you disagree with the judge . . . by Anonymous Coward · · Score: 5, Interesting

      The general thrust is: You can't help people commit crimes.

      In many countries (and I will probably now be disappointed to find that the US isn't one of them) you don't get to just roll up with $5 million of bank notes in a truck and buy something expensive like land or a company. If you do that, and later somebody asks the lawyers "So, what's with the $5M in cash?" and they shrug and say "I didn't ask" they lose their licenses and their offices are crawling with investigators. Even if it turns out you got that $5M through some unlikely but entirely legal means, their failure to ask reasonable questions makes them guilty.

      In my country if you ask the "bank of mum and dad" to help pay for your first house, they need to write a letter explaining who they are, and why this big sum of unexpected money appeared with no strings attached, because otherwise your lender, or your lawyers, or both will freak out and everything stalls while this mysterious money is explained. If instead of "mum and dad" the money comes from "Uncle Albert" who like, isn't actually an uncle but he knew you from when you were a baby, expect that to get crawled over even more. Who is this "Uncle Albert" dude? Does he end up with control over the property in practice despite you owning it on paper? Where did _he_ get the money from?

      Right now in the press you might see fuss about a company called British Home Stores or BHS. The guy who owned it sold it to someone they knew was a fly-by-night terrible business person, so that he could walk away saying it was fine when he left. It collapsed, as he will have known it probably would. Did the politicians say "Oh, well, you sold it, so not your problem" ? No, they're demanding he pay off its pension fund and they're tearing into the other directors, the auditors, and so on. Because all those people had a DUTY not to just say "Oh, whatever, if the owner wants to sell it to some scumbag let him".

  2. You can stuff it under a mattress.... by steveb3210 · · Score: 4, Interesting

    If you take a bitcoin address and print out the hash, you could put that under your mattress and delete the file.

    Only that piece of paper would then enable a person to spend the bitcoins.. If they burned up in a house fire, they would be gone forever assuming certain cryptographic primitives remain secure.