- FINCEN Files reveal the secret role of the Commonwealth Bank and an Australian foreign exchange broker in supporting an alleged five billion dollar money laundering ring
- The secret US Treasury documents were leaked to the International Consortium of Investigative Journalists
- A Russian national may be behind money laundering operation, prosecutors say
The 40-year-old Russian is inside a jail cell in France, where prosecutors argue he is responsible for a vast criminal enterprise.
His problems do not end there: US prosecutors want to extradite him to face criminal charges, while New Zealand police have frozen $130 million of his assets.
The Australian Federal Police are on his tail too.
That is because Mr Vinnik allegedly transferred nearly $100 million through Australia with the help of the Commonwealth Bank, to potentially launder the proceeds of crime.
A ‘breeding ground’ for hackers, fraudsters and public corruption
Mr Vinnik allegedly operated one of the world’s most popular digital currency exchange sites.
Known as BTC-e, the site allowed users to exchange real currency for Bitcoin.
And it offered members — who traded under pseudonyms like CocaineCowboys, ISIS and hacker4hire — near-total anonymity.
The company behind the website was registered in Seychelles — a known money-laundering haven — where people set up shell companies, and hide behind them to protect their identities.
American prosecutors argue BTC-e was a breeding ground for hackers, fraudsters, identity-theft scams, public corruption and drug trafficking.
But there’s a further twist.
Remember how the Mueller investigation found Russian operatives were responsible for hacking the Democratic National Committee, which led to internal Clinton campaign emails getting leaked two days before the 2016 election?
Later analysis showed those Russian hackers paid for their operations using BTC-e, the service American prosecutors claim Mr Vinnik controlled.
How the criminal enterprise unravelled
About a month after Donald Trump was elected president, an analyst for the British bank Barclays began looking at the transactions coming in and out of BTC-e.
The analyst was so concerned by what they’d found, the bank sent a Suspicious Activity Report to the US Treasury’s intelligence division.
“BTC-e also has a high volume of dark web and Tor market activity and mixing activity — a service used to mask and hide the ultimate source of Bitcoin to make them harder to trace,” the analyst stated.
Meanwhile, an FBI investigation into the Bitcoin exchange was gathering pace.
On the morning of July 25, 2017, BTC-e users woke up, turned on their computers, and were met with a stark message.