BitInstant CEO Charlie Shrem Arrested for Alleged Money Laundering!

[rhkazani1]

http://business.time.com/2014/01/27/bitinstant-ceo-charlie-shrem-arrested-for-alleged-money-laundering/

Posted From bitcointalk.org Android App

[anderl]

The complaint alleges that Faiella took orders from Silk Road users hoping to purchase Bitcoin, the anonymous peer-to-peer crypto-currency.

Shrem then filled the orders by transferring funds into an account controlled by Faiella and hosted on a third-party Japan-based Bitcoin exchange MtGox. Together the two allegedly sold over $1 million in Bitcoin to Silk Road users, who then used those Bitcoins to attempt to purchase anonymously drugs and other illegal goods from the deep web black market.

I took the liberty of updating the article above.  Shrem hosted BitInstant which traded cash for Bitcoin using the MtGox merchant API (shopping cart).  Shrem did not know what the purpose of the exchange was for and Shrem did not actually sell drugs.  The users could have bought Bitcoin as an investment or to buy other products.

If you go to a bank to exchange Euros for US Dollars and then go to a crack dealer to buy drugs does the bank get arrested for providing you the currency to do so?

This is clearly a means of trying to attack Bitcoin.  I bet there was some Bank lobbying involved.

[whtchocla7e]

If you go to a bank to exchange Euros for US Dollars and then go to a crack dealer to buy drugs does the bank get arrested for providing you the currency to do so?

That's not the same situation...

[anderl]

If you go to a bank to exchange Euros for US Dollars and then go to a crack dealer to buy drugs does the bank get arrested for providing you the currency to do so?

That's not the same situation...

Enlighten me