The United States Department of Justice (DOJ) has charged Maximiliano Pilipis, the operator of crypto exchange AurumXchange, with money laundering and tax crimes.
According to a recent press release, the DOJ alleged that the 53-year-old defendant conducted over 100,000 tractions, which resulted in a transfer of more than $30 million in funds, some of which came from the held on the Silk Road, an anonymous dark web marketplace that hosted illicit activities including the sale of illegal drugs.
“Together with our partners in federal law enforcement, we will continue to work to investigate and prosecute offenders who exploit digital assets to fuel drug trafficking and other offenses, and those who unlawfully facilitate the transfer and laundering of the proceeds of crime,” said Zachary A. Myers, U.S. Attorney for the Southern District of Indiana.
FBI Shuts Down Silk Road
The court document revealed that Pilipis operated his exchange without a license from 2009 until 2013 when the Federal Bureau of Investigation (FBI) shut down the Silk Road.
AurumXchange and Pilipis collected millions of dollars in fees for facilitating these transactions, accumulating over 10,000 BTC, valued at around $1.2 million at the time.
The agency also accused Pilipis of violating federal registration and reporting requirements for crypto exchanges. The DOJ claimed he ignored the mandate to register with the U.S. Treasury Department and report the exchange’s activities to the federal government.
Pilipis Laundered and Concealed Proceeds
The DOJ alleged that the defendant neglected to enforce Know-Your-Customer (KYC) rules, violating Anti-Money Laundering (AML) and counter-terrorism financing (CTF) regulations.
After shutting down the platform, the DOJ noted that Pilipis divided and transferred the BTC and other assets he obtained from running the exchange to launder and conceal the proceeds of the offenses.
The DOJ accused Pilipis of converting his proceeds into U.S. dollars and using it for real estate investments in Arcadia and Noblesville, Indiana.
A 10-Years Sentence
The department reported that Pilipis’ assets generated hundreds of thousands of dollars in income in 2019 and 2020, yet he failed to file a tax return.
Pilipis faces up to 10 years in federal prison and a fine of up to $250,000 if convicted. A federal district court judge will determine the sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
