Originally published on: October 29, 2024
The United States Department of Justice has taken action against Maximiliano Pilipis, the operator of crypto exchange AurumXchange, for allegedly participating in a money laundering scheme involving the darknet marketplace known as Silk Road. According to the DOJ, Pilipis processed over $30 million in funds through his exchange, with some coming from Silk Road accounts during his tenure.
Silk Road was an infamous online marketplace run by the pseudonymous “Dread Pirate Roberts,” where users could buy and sell products anonymously, most notably drugs. Pilipis operated AurumXchange without a license from 2009 to 2013, collecting substantial fees for facilitating transactions, including 10,000 Bitcoin worth approximately $1.2 million at the time.
In addition to money laundering charges, Pilipis is accused of neglecting federal registration and reporting requirements for crypto exchanges, failing to implement KYC rules, and not filing tax returns for income generated from his assets. After shutting down AurumXchange, Pilipis allegedly laundered his crypto proceeds by converting them into US dollars for real estate investments in Indiana.
A federal grand jury has indicted Pilipis on multiple counts of money laundering and failure to file tax returns. If convicted, he could face up to 10 years in prison and a significant fine. However, the final decision on his sentence will be made by a federal district court judge, taking into account various factors.
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