A Mexican LocalBitcoins trader names Jacob Burrell Campos has been sentenced to two years in federal jail. This was confirmed via a press release from the U.S. Attorney’s Office of the Southern District of California on April 8, 2019.
Campos sold Bitcoin to more than 1,000 people in the United States and has earned more than $820,000 between 2015 to 2018. He achieved this through ATM transfer, cash meetups, and MoneyGram. He did so without following compulsory Anti-Money Laundering (AML) checks and Due Diligence on the source of the funds. Now, Campos has to forfeit everything he earned from the business.
— AML Accelerate (@AMLAccelerate) April 11, 2019
Campos also acknowledged that he and unnamed others took thousands of dollars across the U.S.-Mexico border daily and did transactions with a San Diego precious metals dealer named Joseph Castillo.
David Shaw, a special agent in charge of Homeland Security Investigations in San Diego made the following statement in a press release, saying:
“Today’s sentencing of Burrell is a reminder to those illegal and unlicensed money transmitters that the laws and rules apply to cryptocurrency dealings just as they do to other types of financial transactions.”
Just last year 50-year-old Theresa Lynn Tetly, another LocalBitcoins trader who is also known as the “Bitcoin Maven” has been sentenced to prison for 12 months, charged a $20,000 fine and three years supervision after release. She was found guilty for laundering bitcoin as proceeds of narcotics sales and for playing a role in running an illegal bitcoin-for-cash exchange.
Similar to Campos, she now has to forfeit everything she has gained from the illegal activity, which includes $292,264 in cash, 25 gold bars, and 40 bitcoins.
Several other similar cases have started to pop up all over the media which is why several crypto exchanges have now started to take action and require users to do AML and Due Diligence checks to prevent such cases from happening. One of such exchanges Paxful argus that it is absolutely essential for exchanges of this nature to take a strict stance on AML laws.
On the aftermath of the site reaching to 2 million users, Lana Schwartzman–the chief compliance officer made the following statement.
When operating at such great numbers dedication to strong security measures that align with a future goal of enhanced oversight and compliance, will provide a better customer experience by affording a greater degree of trust and transparency for all customers”.
In today’s world where privacy is so elusive and ruthless data wolves ready to pounce on any data they may find, doing a KYC and ID verification may not seem to align with the spirit of peer to peer cash systems like bitcoin but for the time being, they appear to be necessary evil that needs to be implemented to protect the integrity of the budding ecosystem.
What do you think could be a solution for this? Let us know in the comments section down below!