Tornado Cash Founder Under DOJ Scrutiny for Money Laundering

The department has formally charged Roman Storm and Roman Semenov with various offenses, including money laundering conspiracy, sanctions violations, and operating an unlicensed money transfer business.

The indictment alleges that Storm and Semenov played vital roles in the development, operation, and promotion of Tornado Cash. This service facilitates the mixing of cryptocurrency transactions to increase privacy. However, according to the indictment, the pair’s activities extended far beyond privacy enhancement, as they allegedly facilitated over $1 billion in money laundering transactions and laundered hundreds of millions of dollars for the Lazarus cybercrime organization Group of North Korea.

Roman Storm has been apprehended in Washington and is scheduled to appear before the United States District Court for the Western District of Washington. The allegations against him are severe and include a variety of financial and criminal offenses.

Roman Semenov is still at large, and there are no reports of his arrest. Notably, the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury has placed Semenov on its special investigation list. This listing suggests that his assets may be subject to investigation and withholding.

The matter has garnered the interest of the cryptocurrency community, regulatory bodies, and cybersecurity professionals. It highlights the ongoing concerns regarding the potential misuse of cryptocurrencies for illicit activities, such as money laundering and cybercrime financing.