US, Germany, Finland take down Garantex crypto exchange, seize $26m in laundered funds

US authorities have disrupted and seized the online infrastructure of cryptocurrency exchange Garantex as part of a coordinated operation with Germany and Finland, targeting what officials called a ‘multibillion-dollar crypto money laundering service,’ the Department of Justice (‘DOJ’) announced on 7 March.

‘Since April 2019, Garantex has processed at least $96 billion in cryptocurrency transactions,’ the DOJ stated, noting that the exchange ‘facilitated money laundering by transnational criminal organizations – including terrorist organizations – and sanctions violations.’

In conjunction with the operation, the DOJ unsealed an indictment against two administrators: Aleksej Besciokov, 46, a Lithuanian national and Russian resident, and Aleksandr Mira Serda (previously eksandr Ntifo-Siaw), 40, a Russian national and United Arab Emirates resident.

Both are charged with money laundering conspiracy, while Besciokov faces additional counts of conspiracy to violate sanctions and conspiracy to operate an unlicensed money transmitting business.

‘Garantex received hundreds of millions in criminal proceeds and was used to facilitate various crimes, including hacking, ransomware, terrorism, and drug trafficking, often with substantial impact to U.S. victims,’ according to court documents.

On 6 March, US law enforcement seized three website domain names used by Garantex  Garantex.org, Garantex.io, and Garantex.academy – while German and Finnish authorities seized servers hosting the exchange’s operations. US authorities have also frozen ‘over $26 million in funds used to facilitate Garantex’s money laundering activities.’

According to the DOJ, despite being sanctioned by the US Treasury Department’s Office of Foreign Assets Control (‘OFAC’) in April 2022, Garantex continued to operate and deliberately evade sanctions by moving ‘its operational cryptocurrency wallets to different virtual currency addresses on a daily basis’ to avoid detection by US-based cryptocurrency exchanges.

If convicted, the defendants face up to 20 years in prison for the money laundering conspiracy charge, with Besciokov facing an additional potential 20 years for sanctions violations and five years for operating an unlicensed money transmitting business.

https://www.justice.gov/opa/pr/garantex-cryptocurrency-exchange-disrupted-international-operation