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Bitcoin Seller Arrested for Operating Exchange Without Permission

April 10, 2019 16:20
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While bitcoin still remains uncharted territory for most, there are some who are only out to make a quick buck from the uncertainty stemming from regulations.

Jacob Burrell Campos, an individual who bought and sold bitcoin without registering with the Financial Crimes Enforcement Network (FinCEN), learned about the pitfalls of dealing bitcoin without the required approval. Campos was arrested in August 2018, following which he pleaded guilty of operating an unlicensed cryptocurrency exchange.

As per news portal, The Merkle, buying and selling of cryptocurrency will need to obtain an official money transmitter license. For reasons best known to him, Campos did not obtain one and stated that there was no Anti-Money Laundering (AML) safeguard, which did not turn the situation in his favour.

The news portal further added that due to seriousness of the crime, the accused had to wait awhile before being awarded the judgement. In the meantime, he had to forfeit the profits that was made illicitly. He was ordered to pay around $823,357. Sometime this week, his verdict came in wherein he was sentenced to two years in prison, for operating an unlicensed money transmitter business.

Campos primarily accept money in cash or through MoneyGram, after which he deposited the money into an account on Bitfinex to purchase the required amount of Bitcoin on behalf of his clients. Between 2015 and 2017, he purchased nearly $3.29m worth of Bitcoin was purchased through his account.

This is not the first time, an unlicensed bitcoin seller has been caught by the federal officers. In June last year, in a year-long sting involving multiple US agencies including the Secret Service, Drug Enforcement Administration (DEA), ICE’s Homeland Security Investigation (HSI), more than 35 individuals were arrested in a nationwide undercover operation. During the raid, over 23.6 Million was seized out of which $20 million was cryptocurrencies. The remaining $3.6 Million seized were in US currency and gold bars.

HSI acting executive associate director Derek Benner had said, “The Darknet is ever-changing and increasingly more intricate, making locating and targeting those selling illicit items on this platform more complicated. But in this case, HSI special agents were able to walk amongst those in the cyber underworld to find those vendors who sell highly addictive drugs for a profit.”

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