As the United States kept up its campaign against the crypto mixer, Roman Semenov was added to OFAC’s list of prohibited individuals, and Roman Storm was detained.
A important development has once again brought attention to the vibrant world of cryptocurrencies. Roman Semenov, a co-founder of the cryptocurrency mixer Tornado Cash, was designated an SDN and a Blocked Person by the Office of Foreign Assets Control (OFAC) of the United States Treasury on August 23rd. Roman Storm, a different co-founder, was simultaneously under investigation in Washington state by the Federal Bureau of Investigation (FBI) and the Internal Revenue Service Criminal Investigation division. The background of this developing situation is a broader crackdown on Tornado Cash by American authorities.
Facing the Web of Allegations
Semenov and Storm are accused of a number of offenses, which are detailed in an indictment that was unveiled on the crucial day in August. The accusations include conspiracy to launder money, conspiracy to violate sanctions, and conspiracy to run an unauthorized money transmission business. The fact that the first two offenses each have a maximum sentence of 20 years in jail, while the money transmission allegation includes a maximum term of five years in prison, highlights the seriousness of the accusations.
Roman Storm has been found, however Roman Semenov is still at large. The Tornado Cash saga continues as Alexey Pertsev, the third co-founder, was expected to be detained in the Netherlands in August 2022 on suspicion of money laundering. The ripple effect of these apprehensions extends beyond individuals and delves into a realm of international implications.
Related: Blockchain Association files brief in Tornado Cash case
Unveiling the Alleged Motive
The core of the accusations revolves around Tornado Cash’s alleged assistance in helping hackers and fraudsters hide the proceeds of their illegal activity. Damian Williams, the U.S. Attorney for the Southern District of New York, emphasizes the intricate web of deceit by saying that Storm and Semenov
"knew in fact that they were helping hackers and fraudsters conceal the fruits of their crimes"
despite publicly claiming to provide a technically sophisticated privacy service. As Tornado Cash’s connection to the Lazarus Group, a group of hackers with ties to North Korea and who have already been given an SDN designation, comes to light, this multifaceted drama reveals new levels of intrigue.
As the legal tussle continues to unfold, the digital realm is rife with questions, concerns, and implications. This crackdown, initiated by U.S. authorities, amplifies the tension between cryptocurrency innovation and regulatory compliance. The world watches with bated breath as the narratives of Tornado Cash, Roman Semenov, and Roman Storm converge, symbolizing the intersection of the virtual and the legal.
Related: AnubisDAO Rug Pull Money Laundered on Tornado Cash, Investors' Funds Lost