Localbitcoins Dealer Given 2 Years Prison, Must Return Almost $1 Million in Illegal Gains
Campos, who pleaded guilty last October to operating an unregistered Bitcoin exchange, has now been ordered to hand over $823,357 – money the state believes was earned through the unlicensed transmission of digital funds. The Attorney’s Office of the Southern District of California released a report yesterday confirming the young man has been sentenced to two years prison time and ordered to “forfeit ill-gotten gains.”
Presiding Judge Marylin L. Huff found Campos guilty of operating an unlicensed money transmitting business that sold hundreds of thousands of dollars worth of Bitcoin (BTC) to thousands of citizens throughout the United States.
Non-compliance with AML Procedures
Campos has been in custody for over six months already since his arrest last August, following which he admitted to running a Bitcoin exchange without registering it with FinCEN – the Financial Crimes Enforcement Network. He also admitted to not implementing the required Anti-money laundering (AML) procedures and smuggling over $1 million in cash into the U.S. between 2016 and 2018.
Special Agent in Charge for Homeland Security Investigations, David Shaw, said the sentencing was a reminder to illegal money launderers that the same financial transaction rules apply to cryptocurrency dealings. “HSI Special Agents are proud to work with our law enforcement partners to ensure the integrity of the U.S. financial system, and we will continue to adapt to enforce laws across all borders, including cyberspace and the Darknet,” he concluded.
Following the ruling, U.S. Attorney Robert Brewer praised the work of prosecutor Robert Ciaffa and fellow agents for their work and reiterated the federal governments continued efforts to prosecute “white collar criminals who refuse to comply with anti-money laundering laws.”
Campos was also handed a $250,000 fine in addition to his prison sentence.
As regulations regarding cryptocurrency transactions continue to develop, governments worldwide are finding it difficult to ascertain how criminals in the sector should be tried. In many countries, the lack of regulatory oversight has led to financial crimes and abuses from illicit operators. While cryptocurrency aims to bring financial freedom to the less fortunate, incidents such as these further impact its reputation and global adoption.