Tornado cash developer Roman Storm guilty of one count in federal crypto lawsuit
Roman storm, one Among developers who encrypted anonymous tool Tornado Cash, which has been found guilty of conspiracy, a jury operates unlicensed currency in a New York court jury. He was sentenced to up to five years in federal prison.
In 2023, the U.S. Department of Justice accused Storm of three illegal acts: conspiracy to launder money, conspiracy to violate sanctions, and conspiracy to operate unlicensed currency transmission services.
At the end of Wednesday’s four-week trial and the end of a five-day deliberation period, the jury made a partial judgment: it found the storm guilty of evading sanctions without a licensing business. It failed to reach a consensus verdict on the crime of money laundering, which was sentenced to up to 20 years in prison.
“We are grateful that the jury did not convict Roman of sanctions or money laundering. The only remaining charges involved unlicensed currency transmission, with serious legal issues,” said Brian Klein, a partner at Storm Waymaker, who is one of Storm’s representatives. “We will not stop fighting for the Romans and expect him to be fully proven.”
His lawyer told Wired that Storm intends to dismiss the singular offence in a pre-trial motion.
Tornado Cash was developed by Storm in 2019, and two other Alexey Pertsev and Roman Semenov. The idea is to distract the public transactions recorded on the blockchain by collecting funds belonging to different political parties and then scattering them into a brand new wallet, thus obscuring ownership of crypto coins.
Services like Tornado Cash are crucial to improving the level of privacy available to crypto owners. Privacy has long been a concern for crypto thinkers, but now, especially relevant, is now especially true after a series of violent abductions against people known to own large amounts of cryptocurrencies.
“Privacy is a very pragmatic thing to do with basic security,” Vitalik Buterin, CROCEATOR of Ethereum’s crypto network, told Wired before the trial began. “If anyone knows who has coins, then someone knows who the target is.”
But the U.S. government has a different cash for tornadoes, which is a tailor-made vehicle for money laundering. When it filed charges in 2023, the Justice Department argued that the storm had been built and profited from a tool that allowed criminals to launder at least $1 billion in cryptocurrency, including hackers with links to North Korea.
“Accounting tornado cash service as a ‘privacy service’, in fact, the defendants actually knew it was a paradise for criminals to conduct mass money laundering and evade sanctions,” the indictment said.
At the trial, prosecutors provided evidence that they claimed to prove that tornado cash was designed for money laundering from the very beginning. Their witnesses include a scam victim, who is said to have stolen funds passed through tornado cash, although the account is competed online by prominent members of the cryptocurrency industry – and is a convicted fraudster who uses the service to launder money. It is said that “wash, clean,” the fraudster wrote to his girlfriend in a message about tornado cash.
