Cryptomixer Founders Plead Guilty to Laundering Money for Cybercriminals
The founders of Samourai Wallet, a cryptocurrency mixer, have pleaded guilty to laundering over $200 million for cybercriminals. Keonne Rodriguez, the CEO, and William Lonergan Hill, the CTO, admitted to their involvement in the Samourai money laundering operation, pleading guilty to conspiracy for operating a money transmitting business that handled criminal proceeds.
The two defendants faced a maximum sentence of five years in prison, but as part of their plea agreements, they also agreed to forfeit $237,832,360.55. Their arrest in April 2024 marked a significant turning point in the investigation, with Icelandic law enforcement seizing Samourai's domains and servers, while Google removed the Android mobile app from the Play Store after being served a seizure warrant.
The Samourai Wallet mobile application was downloaded over 100,000 times, enabling users to conduct anonymous financial transactions. However, according to court documents, Rodriguez and Hill have also promoted Samourai as a tool for concealing illicit proceeds, clearly acknowledging its potential for illegal use. In one instance, Rodriguez referred to "mixing" as "money laundering for bitcoin" in a WhatsApp exchange.
Hill also advertised Samourai on a dark web forum as a way to make Bitcoin "untraceable" and for "cleaning dirty BTC," acknowledging that the service's clients included dark and grey market participants. In mid-2020, Rodriguez and Hill also tracked proceeds from a major hack and urged the hackers to use Samourai's Whirlpool service rather than report the crime to the authorities.
Between 2015 and February 2024, criminals used Samourai's Whirlpool Bitcoin mixing service to process over 80,000 Bitcoins (valued at more than $2 billion) in illicit funds from cyber intrusions, illegal dark web markets, a spear phishing scheme, and schemes to defraud decentralized finance protocols. The two money laundering services allegedly generated over $6 million in fees from Whirlpool and Ricochet transactions for the two founders.
"The defendants created and operated a cryptocurrency mixing service that they knew enabled criminals to wash millions in dirty money, including proceeds from cryptocurrency thefts, drug trafficking operations, and fraud schemes," said Attorney for the United States Nicolas Roos in a Wednesday press release. "Rodriguez and Hill admitted to operating a money transmitting business that transmitted crime proceeds, essentially 'washing' more than $200 million in 'dirty' money for criminals. They did not just facilitate this illicit movement of money, but also encouraged it," added IRS-CI Special Agent Harry T. Chavis, Jr.
The Scope of the Operation
Between 2015 and February 2024, Samourai's Whirlpool Bitcoin mixing service was used to process over 80,000 Bitcoins (valued at more than $2 billion) in illicit funds from various sources. This includes:
- Cyber intrusions
- Illegal dark web markets
- A spear phishing scheme
- Schemes to defraud decentralized finance protocols
The two money laundering services allegedly generated over $6 million in fees from Whirlpool and Ricochet transactions for the two founders. The operation was active, with Samourai's mobile application being downloaded over 100,000 times, enabling users to conduct anonymous financial transactions.