Reported by U.S. Department of Justice

In a coordinated international operation, the U.S. Department of Justice, alongside German and Finnish authorities, dismantled the online infrastructure of Garantex, a cryptocurrency exchange allegedly involved in laundering funds for transnational criminal organizations, including terrorist groups, and facilitating sanctions violations. Since its inception in April 2019, Garantex reportedly processed over $96 billion in cryptocurrency transactions. Concurrently, an indictment was unsealed in the Eastern District of Virginia charging Aleksej Besciokov, a Lithuanian national residing in Russia, and Aleksandr Mira Serda, a Russian national based in the United Arab Emirates, with conspiracy to commit money laundering. Besciokov faces additional charges for conspiracy to violate sanctions and operate an unlicensed money transmitting business. 

Summary of indictment

The indictment filed in the Eastern District of Virginia charges Aleksej Besciokov and Aleksandr Mira Serda with operating Garantex, a Moscow-based cryptocurrency exchange, to facilitate extensive money laundering activities. From around June 2019 to the present, Garantex allegedly processed at least $96 billion in cryptocurrency transactions, knowingly serving as a conduit for proceeds from ransomware attacks, computer hacking, narcotics trafficking, and sanctions violations. The defendants are accused of profiting from these illicit activities while deliberately misleading law enforcement about their customers’ identities. 

Despite being sanctioned by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) on April 5, 2022, for facilitating money laundering from ransomware actors and darknet markets, Garantex allegedly continued its operations unabated. The indictment asserts that Besciokov and his co-conspirators knowingly violated these sanctions by engaging with U.S.-based entities for services and infrastructure support. To evade detection and induce U.S. businesses to unknowingly transact with them, Garantex purportedly implemented strategies such as daily changes to their operational cryptocurrency wallets, complicating efforts by U.S.-based exchanges to identify and block transactions linked to Garantex accounts. 

Furthermore, the indictment alleges that Garantex operated as an unregistered money transmitting business within the United States, failing to register with the Financial Crimes Enforcement Network (FinCEN) as mandated by law. This lack of registration is presented as part of a broader scheme to facilitate the laundering of criminal proceeds through the cryptocurrency exchange. 

The defendants face multiple charges, including conspiracy to commit money laundering, conspiracy to violate the International Emergency Economic Powers Act (IEEPA), and conspiracy to operate an unlicensed money services business. These charges reflect the alleged extensive efforts by Besciokov, Mira Serda, and their associates to exploit Garantex’s platform for processing transactions tied to various criminal activities, thereby undermining U.S. financial regulations and sanctions. 

This case underscores the challenges posed by cryptocurrency platforms in the enforcement of financial regulations and sanctions. The indictment highlights the need for vigilance and robust regulatory frameworks to prevent the misuse of digital asset platforms for illicit purposes, ensuring that such entities comply with legal obligations designed to protect the integrity of the financial system. 

Read full indictment: https://www.justice.gov/opa/media/1392316/dl

Read full press release: https://www.justice.gov/opa/pr/garantex-cryptocurrency-exchange-disrupted-international-operation