Two co-founders of the Tornado Cash cryptocurrency mixer have been accused of money laundering and other crimes, a year after the platform was banned by American authorities for its alleged support of hackers from the DPRK.
The US Department of Justice has announced that Roman Semenov and Roman Storm have been charged with conspiracy to launder money, violations of sanctions, and engaging in illegal money business.
Roman Storm, who holds US citizenship, has been arrested in Washington, while Roman Semenov, a citizen of Russia, remains at large.
Last August, the third co-founder, Alexey Pertsev, was arrested in the Netherlands.
The accusations against Tornado Cash include conducting transactions worth over $1 billion for money laundering purposes, and facilitating the laundering of hundreds of millions of dollars for the hacker group known as the Lazarus Group, which is associated with financing the DPRK’s Nuclear Program.
US prosecutor Damian Williams stated, “Despite claims of high technical security, Storm and Semenov were aware that they were assisting criminals in concealing the proceeds of their crimes.”
Furthermore, the US Department of the Treasury has imposed sanctions on Semenov due to his connection with the Lazarus Group.
Tornado Cash, which was launched in 2019, offers mixing services to conceal the origin of funds. These services can be used by both regular users and criminals.
The ban on Tornado Cash has drawn criticism from cryptocurrency advocates who view it as excessive. Brian Klein, Storm’s lawyer, expressed his disappointment with the accusations against his client, stating that they were based on “a new legal theory with dangerous consequences for developers.”
Klein added, “Storm has been cooperating with the investigation since last year and disputes any involvement in criminal activities.”
Representatives for Semenov and Pertsev have not yet commented on the situation.