Digital currency exchange accused of biggest money laundering scheme ever

The United States government has shut down a digital currency website and jailed its executives for allegedly operating the largest money laundering scheme ever, considered by some to be “PayPal for criminals.”

Costa Rica-based Liberty Reserve has been seized by authorities in the US following the unsealing of a federal grand jury indictment Tuesday that charged the website and its administrators with conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business by providing a means of channeling a currency without registering in the US. Law enforcement agencies in 17 countries assisted with the investigation. 

In the complaint, Manhattan Attorney Preet Bharara said Liberty Reserve was structured “as a criminal business venture, one designed to help criminals conduct illegal transactions and launder the proceeds of their crimes.” 

“Its existence was based on a criminal business model,” Bharara added at a Tuesday press conference. 

Since 2006, Liberty Reserve has served as a portal for Internet customers to make anonymous financial transitions on the Web, but investigators say that service thrived on and encouraged illegal activity. Under the guise of a currency transferring site, authorities allege the executives of Liberty Reserve laundered billions of dollars and “facilitated global criminal conduct.” 

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