LA Trader Faces Prosecution for Illegal Bitcoin-Fiat Exchange

Published at: June 12, 2018

A Bitcoin trader in Los Angeles, California is facing prosecution for allegedly running an unregistered multimillion dollar Bitcoin-fiat money transmitting business, NBC LA reported yesterday, June 11.

Under her pseudonym the ‘Bitcoin Maven’, Theresa Tetley, 50, reportedly earned at least $300,000 annually from her black market business, which ran between 2014 and 2017 via a listing on localbitcoins.com. The U.S. Attorney's Office has contended that the ‘Maven’ exchanged between $6 and $9.5 mln in the course of her operations.

The case is reportedly considered to be the first of its kind in Southern California.

Tetley has pleaded guilty to federal charges of operating an unregistered money transmission business, as well as to conducting one financial transaction prosecutors are alleging involved proceeds from drug trafficking.

In the court papers, prosecutors accuse the Maven of "fuel[ing] a black-market financial system [...] that purposely and deliberately existed outside of the regulated bank industry."

The government is pursuing a 30-month federal prison sentence for the crime, with Tetley's defense attorney arguing for a reduced term of one year.

Federal prosecutors further request an order of forfeiture for 40 Bitcoin (about $269,600 at press time), in addition to $292,264 and 25 assorted gold bars that were seized by law enforcement on March 30.

Prosecutors postponed sentencing on Monday, June 11, and have yet to announce a rescheduled date.

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) regulates crypto-fiat dealings under existing legislation for money transmitters.

As of 2011, U.S. cryptocurrency exchangers and administrators have been subject to the Bank Secrecy Act (BSA). In 2013, FinCEN issued further guidance clarifying that they are required to register as money service businesses (MSB) and comply with anti-money laundering (AML) measures and a range of internal safeguards aimed at financial crime prevention.

Tags
United States
Bitcoin Regulation
Cryptocurrency Exchange
Fiat Money
Crimes
Related Posts
Crypto is a ‘Poor Form of Money’ for Terrorists, Congressional Hearing Concludes
The U.S. Congress Subcommittee on Terrorism and Illicit Finance has discussed various methods of terrorism financing with cryptocurrency, according to an official press release on the U.S. House of Representatives Financial Services Committee September 7. In order to monitor threats and methods of terrorist financing, the hearing considered major means of transferring funds by terrorists, including traditional financial institutions and semi-formal methods, such as the hawala exchange system, as well as cryptocurrencies. However, while al-Qaeda, the Islamic State, and other terrorist groups have all attempted to raise funds through crypto, they have not had great success, as Congress concluded in …
Bitcoin / Sept. 8, 2018
BlockShow Americas 2018 Goes Live With ‘Wall Street vs Crypto’ Panel Discussion
The BlockShow Americas 2018 conference kicked off Monday, Aug. 20 in Las Vegas. The first panel discussion involved a heated debate between proponents of two opposite views of how — and if — blockchain should be regulated and adopted by institutions around the globe. BlockShow is a series of fintech and crypto events, usually held in Singapore and Europe; the previous BlockShow took place in Berlin in the spring of this year. The opening panel, titled “Wall Street vs Crypto,” brought together a number of industry experts to discuss the future potential of cryptocurrencies like Bitcoin (BTC), and the importance …
Blockchain / Aug. 20, 2018
Prometheum and Anchorage set to launch alternative cryptocurrency trading system
Anchorage Digital Bank, a pioneer of digital asset custody, and cryptocurrency trading platform Prometheum are in the final approval phase for an alternative trading system, or ATS, tailed specifically for crypto investors. Prometheum Ember ATS, also known as PEATS, is vying to bring alternative trading system technology to digital assets. PEATS will open to traders pending final regulatory approval by the United States Securities and Exchange Commission, or SEC. PEATS is currently undergoing the SEC's rigorous "Three-Step Process" for approving a public ATS. Once launched, Anchorage will custody all digital assets transacted through PEATS. Commonly found in traditional financial markets, …
United States / March 31, 2021
Bancor Seeks to Exclude US Users From Trading Over Regulatory Uncertainty
Decentralized exchange platform Bancor plans to restrict United States residents from trading tokens on July 8, the company confirmed in a blog post on June 18. Citing a lack of clarity from regulators, executives said they took the decision to ban all users with a U.S. IP address from exchanging cryptocurrency. “This decision has been made in light of increased regulatory uncertainty; at this time, we believe this is the most judicious decision for all the members of our ecosystem,” the blog post reads. It continues: “This will enable the Bancor community and ecosystem to innovate faster and with greater …
United States / June 19, 2019
US: CFTC Seeks to ‘Provide Regulatory Clarity’ for Listing Virtual Currency Derivatives
The U.S. Commodity Futures Trading Commission (CFTC) has issued an advisory statement for listing virtual currency derivative products, according to a CFTC press release published yesterday, May 21. The advisory statement is aimed at providing clarity for exchanges and clearing houses. The staff advisory, which was jointly issued by the CFTC’s Division of Market Oversight (DMO) and Division of Clearing and Risk (DCR), focuses on the specific areas involved in listing virtual currency derivatives on a designated contract market or swap execution facility. It covers the necessity for more market surveillance, coordination with CFTC staff, large trader reporting, and DCO …
United States / May 22, 2018