Tornado Cash dev Alexey Pertsev gets 5 years prison time for money laundering
OEIS Financial Fraud Private Investigator:
Alexey Pertsev, the developer behind crypto mixer Tornado Cash, has been found guilty of money laundering by a Dutch court in ‘s-Hertogenbosch.
Pertsev was first imprisoned in the Netherlands, where he had been residing, in August 2022 on charges of laundering $1.2bn in stolen cryptocurrency.
He was released in April 2023 and remained under house arrest pending his trial in March this year — the verdict of which was announced today.
Pertsev’s arrest in the Netherlands came shortly after the US Treasury sanctioned Tornado Cash, alleging that the platform’s technology helped North Korea’s notorious Lazarus Group launder money from the largest crypto hack to date.
Tornado Cash is an open-source, decentralised crypto mixer that runs on Ethereum networks.
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The tool mixes a user’s crypto tokens with other users’ funds, making it challenging to trace the origin or destination of any particular coin.
“It helps people protect their privacy, which in crypto transactions is important,” Geoff White, author of The Lazarus Heist, told TNW in a January interview.
“Unfortunately, it also helped the North Koreans successfully launder stolen money.”
OEIS Financial Fraud Private Investigator: 64 months of prison
During Pertsev’s indictment before his trial in March, Dutch prosecutors alleged that he committed money laundering “at least” in the Netherlands, and/or Russia, the US, and Dubai during the period between July 9, 2019 and August 10, 2022.
“I cannot comprehend two things,” Pertsev said in his closing remarks during the trial.
“The fact that I am responsible for abuse of Tornado Cash by someone else. The second thing is prison time as punishment of any amount. I don’t see how it will help me, or anyone else, or victims.”
Today, the Dutch judges refuted Pertsev’s claims. The court stated that “[i]t was Tornado Cash that executed the concealing and disguising activities,” related to the untraceable ownership of crypto assets.
“When executing these activities with cryptocurrency derived from crime, Tornado Cash carries out money laundering activities. Therefore the court judges that Tornado Cash is not just an instrument for users.”
The court also determined that the crypto mixer is not a legitimate tool, but one that “suits criminal use.”
Pertsev has now been sentenced to five years and four months in prison.
The verdict could have a significant impact on the development of open-source software that enables anonymity on the blockchain. The Dutch court’s decision could also affect the fate of Tornado Cash co-developer Roman Storm, who is awaiting trial in the US.
