Cryptocurrency company Bitzlato was the target of a “major global cryptocurrency enforcement operation” that was announced by the US Department of Justice. The action also resulted in the arrest of the company’s creator, Anatoly Legkodymov.

Lisa Monaco, Assistant Attorney General of the United States, made an announcement on January 18 indicating that enforcement action had been taken against Bizlato in coordination with France. These actions included the seizure of Bizlato’s website and the labeling of the company as a “primary money laundering concern” related to Russian illicit finance.

According to Monaco, the United States Department of Justice, the United States Department of the Treasury, and French law enforcement collaborated to bring legal action against Bitzlato for allegedly “conducting a money transmission business that transported and transmitted illicit funds.” and that it did not meet the requirements of the US regulatory safeguards.” In other words, Bitzlato allegedly moved and transmitted illegal funds.

Legkodymov, a Russian citizen residing in China, was detained by FBI agents on January 17 in Miami as part of the investigation into Bitzlato’s activities.

The United States District Court for the Southern District of Florida is where your arraignment will take place.

Authorities in the United States claimed that the criminal complaint against Bitzlato was based on the company being a “critical financial resource” for a money laundering operation on the Hydra darknet marketplace, which allowed users to launder funds, including Gained from Ransomware Attacks: “Hydra Market users traded over $700 million worth of cryptocurrency with Bitzlato, either directly or through intermediaries, until Hydra Market was shut down by American and German law enforcement in April 2022.

In addition, Bitzlato received more than $15 million from the malware proceeds.”

The enforcement action consisted of a concerted effort across Europe and the United States to seize a significant portion of Bitzlato’s resources, including the company’s servers, as well as to arrest the company’s creator.

The “most substantial enforcement effort” against an exchange since the National Cryptocurrency Compliance Team was established in October 2021, according to Monaco, who called the case “the most significant enforcement effort.”

Assistant Attorney General Kenneth Polite of the Justice Department’s criminal division said US authorities were “just getting started” in their crackdown on similar companies engaged in facilitating money laundering.

Monaco issued a warning to people committing crimes against the US financial system “from a tropical island,” despite no official commenting explicitly on the current prosecution against cryptocurrency exchange FTX and its former CEO Sam Bankman-Fried.