Jacob Burrell Campos of Mexico recently got sentenced to two years in prison and to give up all illicit profits generated from operating an unlicensed money transmitting business. Campos was arrested on 13th August last year and has been in custody without bail since that time.
He was on trial by 29th October 2018 where he pleaded guilty and admitted to operating a Bitcoin exchange without registering with the Financial Crimes Enforcement Network of the US Department of Treasury and without implementing the required anti-money laundering safeguards.
Campos generated the fraudulent profits of more than $823,300 which he will forfeit from the unlicensed money transmitting business by selling hundreds of thousands of dollars in Bitcoin to more than 1,000 customers through the United States.
Campos is said to have advertised his firm on Localbitcoins.com and communicated with his clients through email and text messages. This was often done using encrypted applications. He negotiated a commission of five percent above the prevailing exchange rate and accepted cash in person through nationwide ATMs and MoneyGram.
Burrell admitted that even though he had no anti-money laundering or Know your Customer kind of program, he performed no due diligence on the source of his customers’ money.
As reported by RTT News:
“Explaining his modus operandi, Burrell said he began by purchasing his supply of Bitcoin through a U.S.-based, regulated exchange, but his account was soon closed because of the large number of suspicious transactions.
Burrell provided his customers with anonymity and privacy. But he also exchanged more than $1 million in unregulated cash.
Robert Brewer is a US lawyer who spoke on the matter saying, "the federal government will continue to investigate and prosecute all white collar criminals who refuse to comply with the anti-money laundering laws of the United States, and who assist others in avoiding scrutiny of their ill-gotten gains."