Roman Sterlingov Found Guilty in Bitcoin Fog Money Laundering Case: Defense to Appeal Verdict

2024-03-13 16:12:59

“Jurors found Sterlingov guilty of all four counts, including conspiracy to commit money laundering, money laundering and two counts related to failure to register a money transfer service,” Bloomberg reported. The defense will appeal the verdict.

A jury concluded on Tuesday that 35-year-old Roman Sterlingov provided a service that scrambled digital tokens to make it harder to trace the source of proceeds from illegal activities. The government alleged that Bitcoin Fog processed more than $400 million worth of untraceable transactions, including some from illegal markets.

Sterlingov, a Russian-Swedish citizen, pleaded not guilty. He has denied ever running Bitcoin Fog, and faces up to 20 years in prison on the most serious charges. He has been in pre-trial detention for nearly three years.

The defendant created the entire operation to help criminals hide their assets.

Prosecutor Catherine Pelker told the jurors during closing arguments. According to Pelker, the evidence clearly shows that Sterlingov “cooperated” in setting up Bitcoin Fog.

The government said it found some smaller transactions from an account registered in Sterlingov’s name, which was apparently used to test Bitcoin Fog before its 2011 launch. Sterlingov said he was a user of Bitcoin Fog but did not collect fees as the government claimed.

There is no evidence anywhere, including eyewitness accounts or server logs, that Mr. Sterlingov operated Bitcoin Fog.

Tor Ekeland, defense attorney, told the jurors during the closing arguments.

“The government found no evidence of Bitcoin Tooth on Sterlingov’s electronic devices or notebooks,” Ekeland said. He also questioned why Sterlingov would use a secret, multi-step process to fund Bitcoin Fog when the transaction originated from an easily traceable account registered in Sterlingov’s name.”

The defense also questioned the reliability of Chainalysis, a Wall Street-backed firm that has been consistently used by the Justice Department and the Treasury Department to help trace the flow of cryptocurrencies in money-laundering cases.

As explained earlier in the record, the court finds that the government has established by a preponderance of the evidence that the blockchain analysis generated by Chainalysis Reactor is the product of sound principles and methods, and the court accordingly denies the defendant’s motion to exclude from this analysis based on testimony and evidence.

– was ordered on February 29, 2024.

“The government said the company was trustworthy and that it used other methods to connect Sterlingov to the operation of Bitcoin Fog,” reports Bloomberg.

According to Tor Ekeland a defense will appeal against the judgment.