back to article Former Bitcoin Foundation chair pleads guilty to money-laundering charge

Former Bitcoin Foundation chair and BitInstant CEO Charlie Shrem has entered a guilty plea on charges that he operated an illegal currency trading operation, and will fork out nearly a million dollars to the US government, in a deal that avoids a trial that was due to start on September 22. Shrem, who resigned his position at …

  1. pete 22

    banks and laundery

    ... and how many days did HSBC get for laundering drug money? Or any of the big banks involved in the financial crisis? What about their executives, *somebody* has to be responsible for corporate decisions after all, even if they aren't held accountable to it.

    1. Chris 155

      Re: banks and laundery

      Two things.

      The first is that they haven't actually seen whether they get jail sentences or not.

      The second is a bit more complicated. Proving who knew or didn't know something is really difficult, and unless there's a legislated duty for the person to know, you're going to have to actually prove they did. HSBC probably knew that the money was drug money, but proving it was going to be difficult so the government took a cash settlement.

      These two morons spent years not filing the necessary paperwork for transactions. The government had them stone cold on that, they merely had to prove that a transaction over the reporting limit occurred, and didn't need to prove if they knew it was dodgy. Because of this, the idiots in question had to cop a guilty plea to avoid significantly more jail time.

      TL;DR; To toss anyone from HSBC in jail you'd have to prove that they knew that the money was from drugs and proving what someone knew is really damned difficult. These two could have spent the rest of their lives in jail for statutory infractions so they've had to admit they knew(whether they did or didn't) to get out in as little as five years.

    2. Matt Bryant Silver badge

      Re: Pete 22 Re: banks and laundery

      Yes, because all that excuses Shrem's knowingly providing a system to facilitate illegal drug deals, right?

  2. Sureo

    Wait a minute

    He gets fined $950,000 by the government? Doesn't that make the government an accessory to the crime?

    1. Anonymous Coward
      Anonymous Coward

      Re: Wait a minute

      They are definitely profiting from criminal activity. The same could be said for any fine. The government loves illegal activity; it is easy to "profit" off of it in the name of justice.

      1. Anonymous Coward
        Anonymous Coward

        Re: Wait a minute

        But the Goverment gives that money - in one form or another - to us!

        Wait a minute, we are all guilty!

        1. Destroy All Monsters Silver badge

          Re: Wait a minute

          Holy shit! I just realized that without government we would have NO MONEY?

          Thank God of the disgusting eejits in charge!

      2. Destroy All Monsters Silver badge

        Re: Wait a minute

        The government loves illegal activity; it is easy to "profit" off of it in the name of justice.

        Related: Never have have any important amount of cash when on an US highway!

        Aggressive police take hundreds of millions of dollars from motorists not charged with crimes aggressive brand of policing that has spurred the seizure of hundreds of millions of dollars in cash from motorists and others not charged with crimes, a Washington Post investigation found. Thousands of people have been forced to fight legal battles that can last more than a year to get their money back.

        Behind the rise in seizures is a little-known cottage industry of private police-training firms that teach the techniques of “highway interdiction” to departments across the country.

        “All of our home towns are sitting on a tax-liberating gold mine,” Deputy Ron Hain of Kane County, Ill., wrote in a self-published book under a pseudonym. Hain is a marketing specialist for Desert Snow, a leading interdiction training firm based in Guthrie, Okla., whose founders also created Black Asphalt.

    2. Anonymous Coward
      Anonymous Coward

      Re: Wait a minute

      Yes, it's a classic case of "Do as I say, not as I do".

      The government can:

      - Profit from criminal activity

      - Illegally surveil all of it's citizens

      And of course many other things that you'd be thrown in jail for. It's the age of democracy people! Everyone is equal, it's just that some people are more equal than others!

  3. amanfromMars 1 Silver badge

    A Question to Ask which Begs a Definitive Leading Statement of all Mark Carney types*

    Shrem, who resigned his position at the Bitcoin Foundation in January following his arrest, has owned up that not only did he process transactions on behalf of the now-defunct Silk Road, but that he knew the online marketplace was a haunt of drug dealers.

    According to Reuters, Shrem told the court that he “new that much of the business on Silk Road involved the buying and selling of narcotics”.

    Is the US Federal Reserve and government trying to claim there should be a legitimate dollar monopoly in the buying and selling of narcotics, with their laundering system accepting all proceeds, or is that a charge which can be laid at the door of all traditional fiat currency trading banking systems, however inconvenient and unpleasant that truth may be? Or is the online virtual marketplace the real target of the weak vulnerable and easily corrupted and perverted banking system as is revealed in this paper ....... Opening discussion on banking sector risk exposures and vulnerabilities from virtual currencies: An operational risk perspective.

    Or is it a double whammy of despair and desperate operation?

    * And dodging that bullet with dumb ignorant arrogant bullshit and prevaricating rhetoric has one shooting oneself in the head in support of a hacked and cracked root, and not in the foot.

  4. War President

    Crime pays if you're the big guy...

    If you're a big bank, you can get away with knowingly laundering tens of billions of dollars for drug cartels and terrorist organizations with nary a slap on the wrist (a $1.9 billion fine is the just the cost of doing business if you're a bank like H*** with $2 trillion in assets). No jail time for them, long years in prison for you.

  5. graeme leggett

    Sending the wrong message?

    Not commenting on the specifics of this case, but in general

    If a banking executive or other money handling organization can make a problem disappear through the application of money, then isn't there going to be the temptation of taking a chance in the expectations (hope?) that the funds accumulated can be used to avoid prison if it gets found out.

    Would the guarantee of a prison sentence if convicted of these sort of "white collar crimes" be more or less likely to keep people on the straight and narrow?

    1. Tom 13

      Re: Sending the wrong message?

      Difficult to say.

      The first problem is that a lot of these people think they're smarter than the system and will never be caught. Unfortunately, too many of them are and therefore aren't.

      Second problem, unless RICO is invoked, the accumulation of money makes the conviction less likely. If they are the hyper rational sort, that can negate the guarantee.

      Third problem, we have at this time a breed of relativists in the system who seem to think a fair justice system is one in which a perp has at least a 50-50 chance of being found not guilty regardless of the facts surrounding the accusation.

      The combination of all these things has been having a more and more adverse affect on what use to be called our justice system.

  6. Anonymous Coward
    Anonymous Coward

    The case basically comes down to fewer than a dozen emails.

    He should have run his business from the City ref ref

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