Operator of the darknet’s oldest crypto mixer Bitcoin Fog, Roman Sterlingov has been given over a twelve year sentence for allegedly running an over $400 million laundering case.
The official court documents state that a dual Russian-Swedish national was given a 12-year and 6-month prison sentence today. The money laundering scam comes as the sector is already been grappling with accusations of being unsafe.
Bitcoin Fog Gets Sentence For Running Money Laundering Scam For 10 years
Based on the evidence presented during the trial and court documents, Roman Sterlingov, 36, was involved in running Bitcoin Fog, the longest-running cryptocurrency “mixer” on the darknet, from 2011 to 2021.
During its ten years of operation, Bitcoin Fog processed transactions totaling more than 1.2 million bitcoin, which at the time were worth about $400 million. It became well-known as the preferred money laundering service for criminals looking to conceal their illegal gains from law enforcement.
The majority of this cryptocurrency originated from darknet marketplaces and was linked to content about child sexual abuse, identity theft, computer crimes, and illegal drugs.
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Sentencing Comes As A Statement For the Larger Crypto Sector
In addition to imposing the sentence, US District Judge Randolph Moss ordered Sterlingov’s assets, including $103 million worth of Bitcoin, to be forfeited, totaling $395 million. Since its launch in 2011, Bitcoin Fog has been the most established mixer, according to the US Department of Justice.
“Roman Sterlingov ran the longest-running bitcoin money laundering service on the darknet, and today he paid the price,” said Deputy Attorney General Lisa Monaco.
They added, “In the deepest corners of the internet, he provided a home for criminals of all stripes, from drug traffickers to identity thieves, to store hundreds of millions of dollars in illicit proceeds. Today’s sentence reflects the Department’s determination to dismantle the criminal networks that enable criminal actors to flourish and ensure consequences for the criminals operating them.”
The sentence, according to FBI Assistant Director David Sundberg, serves as a warning against all cybercrimes. He went on to say that in order to dismantle cybercriminal networks and apprehend those who aid criminal activity, the FBI will employ all of its resources and collaborations. The Internal Revenue Service (IRS) was also involved in the Sterlingov investigation.
The amount of cryptocurrency sent to services by illicit addresses in 2023 was $22.2 billion, a substantial drop from the $31.5 billion sent in 2022 but still higher.
A portion of this decline could be explained by a general decline in the volume of both legal and illegal cryptocurrency transactions. In contrast to the 14.9% decline in the overall volume of transactions, the decline in money laundering activity was more pronounced, at 29.5%.