Bitcoin Fog Founder Convicted in $400 Million High-Profile Cryptocurrency Laundering Case
Roman Sterlingov, the owner of Bitcoin Fog, a well-known cryptocurrency mixing service, was convicted of money laundering in United States District Court on Tuesday, March 12th. Sterlingov faced charges including money laundering, conspiracy laundering, operating an unlicensed money-transmitting business, and violations of the D.C. Money Transmitters Act. Despite claiming to be just a user of Bitcoin Fog, Sterlingov was found guilty of his involvement in operating the service. His lawyers plan to appeal the verdict.
The trial revealed that Bitcoin Fog had been operating as a money laundering service for almost a decade, from October 2011 to April 2021. The service facilitated the hiding of illegal assets for criminals, with nearly 1.2 million Bitcoin transactions valued at $400 million being processed during that time. The majority of these transactions were linked to darknet marketplaces involved in narcotics, computer fraud, identity theft, and the distribution of child sexual abuse materials.
As part of the verdict, the jury has ordered the forfeiture of Bitcoin Fog assets, including 1,354 BTC held in a Bitcoin Fog wallet and approximately $350,000 worth of cryptocurrency in a Kraken account, both of which have been seized. Sterlingov faces significant penalties, with money laundering conspiracy and money laundering carrying a maximum sentence of 20 years imprisonment, while the other charges have a maximum sentence of 5 years. His sentencing is scheduled for July 15.
The conviction of Roman Sterlingov serves as a warning to other crypto mixer platforms and their owners. In September, the case of Roman Storm, co-founder of Tornado Cash, another controversial crypto mixer, will also be heard in court. The guilty verdict in the Bitcoin Fog case is seen as a major victory for law enforcement agencies in their ongoing battle against illegal activities in the cryptocurrency space. The U.S. Criminal Division remains committed to identifying and prosecuting those who use technology to conceal their crimes, regardless of the complexity of their operations.