Florida Targets High-Dollar Bitcoin Exchangers

[Crypto0]

State authorities in Florida on Thursday announced criminal charges targeting three men who allegedly ran illegal businesses moving large amounts of cash in and out of the Bitcoin virtual currency. Experts say this is likely the first case in which Bitcoin vendors have been prosecuted under state anti-money laundering laws, and that prosecutions like these could shut down one of the last remaining avenues for purchasing Bitcoins anonymously.

http://krebsonsecurity.com/2014/02/florida-targets-high-dollar-bitcoin-exchangers/

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[bryant.coleman]

I don't understand. Are there any high-dollar BTC exchanges which are based in FL? I don't think there are any.

[seriouscoin]

I don't understand. Are there any high-dollar BTC exchanges which are based in FL? I don't think there are any.

Well obviously if you dont read... 

[Crypto0]

I don't understand. Are there any high-dollar BTC exchanges which are based in FL? I don't think there are any.

localbitcoins.com

[eldentyrell]

I think this might be a hoax.

Krebs' website does not have links to any court documents, and he's ignoring the commenters (see comments on that page) asking for them.

The story seems to have been picked up by only three other sites, all of them small local news outlets.

I'm starting to wonder if law enforcement didn't "leak" a phony story to try to scare people.

[rizzman]

Its not bullshit guys, 5 minutes of searching confirms.


http://egvsys.miamidade.gov:1608/wwwserv/crts/IPSAWNSX.DIA?PROCESS=D&L_NAME=ESPINOZA%20%20%20%20%20%20%20%20%20%20%20%20%20&F_NAME=MICHELL%20%20%20%20%20&M_NAME=ABNER%20%20%20%20%20%20%20&INITIME=&NAME=ESPINOZA,%20MICHELL%20ABNER%20%20%20%20%20%20%20%20%20%20%20&IMTLOC=MWDC%20%20%20%20&ALPHA=10162377&GAMMA=17&DELTA=

http://egvsys.miamidade.gov:1608/wwwserv/crts/IPSAWNSX.DIA?PROCESS=D&L_NAME=REID%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20&F_NAME=PASCAL%20%20%20%20%20%20&M_NAME=%20%20%20%20%20%20%20%20%20%20%20%20&INITIME=&NAME=REID,%20PASCAL%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20&IMTLOC=TGKCC%20%20%20&ALPHA=10177836&GAMMA=22&DELTA=

Here is the Statute
http://www.flsenate.gov/Laws/Statutes/2011/560.125

This is making me wonder what are the legalities in selling to major exchanges as well. IE. Coinbase. For example, These guys are registered at the FEDERAL level but what about the STATES level? Additionally, If you read the way the law is written, it does not say anything about the legalities when selling TO a licensed business nor does it exempt people who are selling to established, registered companies. Just that if a person/business "A person may not engage in the business of a money services business" then they need to be licensed.

I hope this is not the case, but if it is, anyone who does business with the exchanges who resides here in Florida and possibly other states could in theory be getting screwed via technicality of jurisdiction... This is bad stuff.


While they should have simply refused the transaction as soon as the cops mentioned using them for illicit activities and I believe they will definitely serve time for that charge, The community might want to considering setting up a legal fund for these guys since this case will definitely affect the Bitcoin community as a whole seeing as it will be setting a legal precedent in all cases where someone wants to do a person-to-person transaction, let alone clarification of who is considered a money servicing business on the state level.

Also, if there are any lawyers on here who can read the statute and chime in it would be helpful seeing that this is going to get ugly if we don't start making it a conversation.

[eldentyrell]

Its not bullshit guys

Nice find.

Its not bullshit guys, 5 minutes of searching confirms.

I must confess that the department of corrections inmate roster is not something I have on speed-dial

Here is the Statute
http://www.flsenate.gov/Laws/Statutes/2011/560.125

I don't doubt there is a law (probably several) against this on the books.  Along with stuff like serving pretzels at bars and playing bingo for more than five hours.

Also,

Another intermediate possibility is that some mid-level law enforcement officer jumped the gun on this, running a sting and grabbing these guys without discussing it thoroughly with senior enough prosecutors.  End result these guys get set loose with no charges in a few days and we never know the difference.  Since this was a sting there were clearly "operations" people involved; maybe it was all operations people and no lawyers, and right now those operations people are sitting down with a bunch of state attorneys who are explaining to them that "yes, that law is on the books" but their time is not well spent (nor their careers advanced) by chasing kids for trading baseball cards.  Even if baseball cards are "trendy" right now and all over the news.

^^ stuff like that is why most news organizations wait for the charging documents or press release before they run a story.  Happens more often than you'd think.

[rizzman]

Its not bullshit guys

Nice find.

Its not bullshit guys, 5 minutes of searching confirms.

I must confess that the department of corrections inmate roster is not something I have on speed-dial

Here is the Statute
http://www.flsenate.gov/Laws/Statutes/2011/560.125

I don't doubt there is a law (probably several) against this on the books.  Along with stuff like serving pretzels at bars and playing bingo for more than five hours.

Also,

Another intermediate possibility is that some mid-level law enforcement officer jumped the gun on this, running a sting and grabbing these guys without discussing it thoroughly with senior enough prosecutors.  End result these guys get set loose with no charges in a few days and we never know the difference.  Since this was a sting there were clearly "operations" people involved; maybe it was all operations people and no lawyers, and right now those operations people are sitting down with a bunch of state attorneys who are explaining to them that "yes, that law is on the books" but their time is not well spent (nor their careers advanced) by chasing kids for trading baseball cards.  Even if baseball cards are "trendy" right now and all over the news.

^^ stuff like that is why most news organizations wait for the charging documents or press release before they run a story.  Happens more often than you'd think.

Lets hope so. None the less, this is bad news for everyone... Its almost as bad as gun sale laws. But atleast those have person to person sales protection... atleast for now .