US federal prosecutors have rebutted claims they suppressed proof of their case in opposition to the co-founders of the crypto mixing service Samourai Pockets, arguing their disclosure of a dialog with Treasury Division workers was made throughout the required timeframes.
In a Could 9 letter to a Manhattan federal courtroom, prosecutors opposed a request for a listening to, claiming they handed over “all identified substantive communications” between them and the Treasury’s Monetary Crimes Enforcement Community (FinCEN) relating to Samourai “months upfront of pretrial motions and trial.”
“The defendants could have seven months to utilize the knowledge earlier than trial,” they wrote. “Nothing extra is warranted.”
On Could 5, Samourai co-founders Keonne Rodriguez and William Hill requested the courtroom for a listening to, claiming that prosecutors were late to disclose that FinCEN representatives advised them six months earlier than they charged the pair that underneath the company’s steerage, the service “wouldn’t qualify as a ‘Cash Providers Enterprise’ requiring a FinCEN license.”
Nonetheless, prosecutors nonetheless charged the pair in February 2024 with conspiracy to function an unlicensed cash transmitting enterprise and cash laundering conspiracy, unsealing the charges and arresting the pair in April that yr. They’ve each pleaded not responsible.
Of their letter, prosecutors argued they “acted in good religion” in disclosing the “contents of this casual dialog” between them and Kevin O’Connor, the chief of FinCEN’s Digital Property and Rising Expertise Part within the Enforcement and Compliance Division, and Coverage Division staffer Lorena Valente.
They claimed O’Connor and Valente’s feedback have been “their particular person, casual, and caveated opinion” on whether or not Samourai would want to register as a cash transmitter underneath FinCEN rules.
FinCEN “didn’t have a way” of broaching Samourai
The prosecutor’s letter famous that an e mail from one of many prosecutors summarizing the August 2023 name with FinCEN mentioned that as a result of Samourai doesn’t take custody of the crypto, it “would strongly recommend that Samourai is NOT performing as an MSB [money services business].”
Nonetheless, it famous FinCEN workers “didn’t have a way of what FinCEN would determine if this query have been offered to their FinCEN coverage committee.”
Samourai’s attorneys had claimed that the decision confirmed Rodriguez and Hill “weren’t cash transmitters underneath FinCEN’s steerage” and that they “couldn’t probably be prosecuted for not having a license.”
The Samourai co-founders had bid to dismiss the case in April, pointing to Deputy Lawyer Common Todd Blanche’s memo released that month saying the Justice Division wouldn’t prosecute crypto mixers for “unwitting violations of rules.”
Of their letter, prosecutors addressed the memo, arguing the courtroom “shouldn’t take into account” it, because the memo states it “might not be relied upon to create any proper or profit” in opposition to the US or its departments.
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