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U.S. seizes Liberty Reserve over money laundering

Wednesday, May 29, 2013 - 01:38

May 29 - U.S. prosecutors have seized control of digital currency exchange Liberty Reserve, accusing it of helping criminals around the world launder more than $6 billion in illicit funds linked to everything from child pornography to software for hacking into banks. Joanna Partridge reports.

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A "black market bank" - how Liberty Reserve was described by law enforcement authorities. U.S. prosecutors have seized control of the digital currency exchange. They say the Costa Rica-based company helped criminals around the world launder over $6 billion. The illicit funds were linked to everything from child pornography and drug trafficking to software for hacking into banks, says U.S. Attorney Preet Bahrara. SOUNDBITE: PREET BHARARA, UNITED STATES ATTORNEY FOR THE SOUTHERN DISTRICT OF NEW YORK, SAYING (English): "We announced charges in what may be the largest international money laundering case ever brought by the United States. Specifically we unsealed charges against Liberty Reserve and seven of its principles and employees who for years have operated one of the world's most widely used digital currencies. But as alleged, the only liberty that Liberty Reserve gave many of its users was the freedom to commit crimes, as it became a popular hub for fraudsters, hackers and traffickers." Liberty Reserve founder Arthur Budovsky was arrested in Spain on charges of money-laundering, as he was travelling back to Costa Rica. Other arrests were made in various countries. Prosecutors said Liberty Reserve had over a million users worldwide and virtually all its business was related to suspected criminal activity. Unlike Liberty Reserve, some other digital currencies require users' identities. Prosecutors said they had taken a step towards reigning in the "wild west of internet banking", and analysts wonder if this could signal the start of a crack-down on other online payment systems.

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U.S. seizes Liberty Reserve over money laundering

Wednesday, May 29, 2013 - 01:38