Originally published on: October 29, 2024
The United States Department of Justice has made a bold move, charging the operator of AurumXchange, a crypto exchange, with money laundering. According to the DOJ, millions of dollars were processed through the exchange, with some funds originating from the infamous darknet marketplace, Silk Road.
Maximiliano Pilipis, a 53-year-old individual allegedly behind AurumXchange, is accused of overseeing over $30 million in transactions across 100,000 accounts during the operation of the exchange. Some of these transactions were linked to Silk Road accounts, shedding light on the illicit activities taking place.
With the pseudonym “Dread Pirate Roberts,” the American Ross Ulbricht managed the Silk Road marketplace on the Tor network between 2011 and 2013. This platform allowed anonymous buying and selling, attracting thousands of drug dealers and gaining notoriety in the cybercrime world.
The DOJ’s allegations include Pilipis running his exchange without a license from 2009 to 2013, coincidentally the same year the FBI brought down Silk Road. During this time, Pilipis reportedly collected significant fees, including 10,000 Bitcoin worth about $1.2 million at that time, for facilitating these dubious transactions.
Moreover, Pilipis is accused of neglecting federal regulations for crypto exchanges by failing to register with the US Treasury Department and comply with reporting requirements. Additionally, he violated Anti-Money Laundering (AML) and counter-terrorism financing (CTF) regulations by not implementing Know Your Customer (KYC) rules.
After the closure of AurumXchange, Pilipis purportedly attempted to conceal his ill-gotten gains by converting his crypto into US dollars and investing in real estate in Indiana. With properties located in Arcadia and Noblesville, some of Pilipis’ assets are reportedly under bank ownership.
Authorities claim that Pilipis failed to disclose substantial income generated from his assets in 2019 and 2020 by not filing a tax return. A federal grand jury has since indicted Pilipis on five counts of money laundering and two counts of willfully failing to file a tax return, potentially resulting in a 10-year prison sentence and a hefty fine.
As Pilipis awaits his fate in a federal district court, the crypto community remains vigilant about the implications of such illegal activities in the digital asset space. Stay informed and make informed decisions by subscribing to our newsletter for the latest updates on crypto laws and regulations.
