White-Collar Crime Lawyer in MI

If you are being investigated for alleged illicit transactions or money laundering using cryptocurrency, contact the experienced white collar crime attorneys at Bajoka Law in Detroit today. Michigan’s leading law firm for money laundering charges with cryptocurrency.

Pandemic Fraud Convictions Mount Across United States FEDERAL PANDEMIC RELIEF PROGRAMS The COVID-19 pandemic led to an economic crisis that was felt strongly by most Americans. In an effort to help keep the economy afloat during the early stages of the pandemic, Congress authorized various forms of financial assistance that went directly to people and businesses across the country. In addition to stimulus payments that many Americans received, Congress authorized money for small businesses to help pay for expenses such as rent, payroll, and other overhead. The main source of financial assistance is found within the CARES Act (Coronavirus Aid, Relief, and Economic Security Act. Nearly $3 trillion dollars was set aside for individuals and small businesses in the form of forgivable loans through the Small Business Administration (SBA). The Paycheck Protection Program (PPP) within the CARES Act served to cover payroll expenses while other expenses could be covered through the Economic Injury Disaster Loan (EDIL) or the Unemployment Insurance (UI) programs. Unfortunately, many people saw these federal funds as an opportunity to defraud the government into giving out free money for nonexistent businesses and expenses. Many individuals have faced federal prosecution for defrauding the government through the submission of fake payroll statements, fake business documents, and other forms of dishonest behavior. If you are facing prosecution for allegedly defrauding a federal pandemic relief fund, then it is important to get in touch with an experienced federal criminal defense attorney immediately, as both the Department of Justice (DOJ) and federal judges are in favor of harsh sentences for individuals that are convicted. EXAMPLES OF HARSH PRISON SENTENCES FOR PANDEMIC FRAUD CONVICTIONS Federal prosecutors across the country are asking federal judges for harsh prison sentences for defrauding the CARES Act, and many federal judges are imposing them. Two examples of cases that resulted in harsh prison sentences include: A man from Texas was convicted of several forms of white-collar crime including wire fraud and money laundering for his actions defrauding the CARES Act through the submission of fraudulent PPP loan applications. He admitted to submitting applications to two different lenders for three non-existent businesses. In these applications, he made untrue statements about his employee and payroll expenses and even submitted false tax returns to obtain relief money. He allegedly received $1.6 million through his efforts, which led to a nine-year prison sentence by a federal judge. A California family of three was convicted of conspiracy to commit bank fraud, conspiracy to commit wire fraud, conspiracy to commit money laundering, several counts of wire fraud, and several counts of bank fraud for their actions in defrauding the PPP and EIDL program. Two of the family members were also convicted of aggravated identity theft. The family allegedly received more than $20 million for their efforts, which led to each member being sentenced to up to 17 years in federal prison by a federal judge. These are just two examples of many that involve harsh sentencing by federal judges for cases that involve defrauding the CARES Act. There are many other examples just like this with the increased focus and attention that the Department of Justice and Federal Bureau of Investigation (FBI) are putting into investigating and prosecuting these cases. It is expected that these cases will continue to be investigated and prosecuted for the foreseeable future. FEDERAL FOCUS ON PANDEMIC FRAUD ENFORCEMENT The FBI and federal prosecutors have directed many resources towards the investigation and prosecution of those who they suspect of defrauding and federal pandemic relief programs. It is important to understand that federal judges are not viewing these cases in the same lens as most typical federal fraud or other white-collar crime cases. Judges are taking an increasingly harsh stance against those who are accused of violating the trust of the U.S. government during the pandemic and defrauding a pandemic financial relief fund. Make sure you have the legal help you need so you don’t face unnecessary prosecution and punishment. If you are being investigated or have already been charged with an offense related to defrauding the CARES Act, then call us at Bajoka Law so we can help!

WHAT IS A SERVICE DEPOSIT ADDRESS ON A CRYPTOCURRENCY NETWORK? A deposit address is found on a cryptocurrency network to link deposits to user wallets. When someone wants to send cryptocurrency from one wallet to another, they do so by depositing the money through a deposit address. The deposit addresses found on cryptocurrency networks are not actually owned by the users but work to link deposits to specific users. Users can have multiple service deposit addresses and can generate new ones through their cryptocurrency network. These addresses can be used to conduct all types of business, as they are simply where crypto money can be deposited. Service providers use deposit addresses so people they are doing business with have a place to deposit their cryptocurrency. If you have legal questions related to cryptocurrency, then it is important to speak to an experienced attorney who can best help you. HOW IS A SERVICE DEPOSIT ADDRESS USED FOR MONEY LAUNDERING? Money laundering is a major part of any criminal activity that is financed by cryptocurrency. Those who use cryptocurrency to finance criminal activity do so because of its anonymity and would like to be able to convert the money to cash or other legal, usable funds. To help make this happen, cybercriminals use service providers to help them launder their money. Service providers that help cybercriminals launder money do so by using services like high-risk cryptocurrency exchange portals, online gambling, cryptocurrency mixing services, and financial entities that operate in high-risk areas. Users then transfer their laundered cryptocurrency to cash that can be used for legitimate activities or simply deposited into regular bank accounts since the money is now “clean.” IMPORTANT 2020 CRYPTOCURRENCY MONEY LAUNDERING STATISTICS In 2020, 270 service deposit addresses accounted for an estimated 55% of the cryptocurrency laundered, at an estimated value of $1.3 billion. A wider view looking at the top 1,867 service deposit addresses related to cryptocurrency money laundering in 2020 shows that these service deposit addresses accounted for 75% of cryptocurrency laundering in 2020, with an estimated value of $1.7 billion. Many of these deposit addresses are operated by third-party service providers who use “nested services” to help launder money. Nested services operate within larger financial exchanges, using over-the-counter brokers and other services to help cybercriminals launder their money through multiple exchanges. Illicit cryptocurrency funds that are laundered come from crimes such as ransomware, darknet markets, scams, child abuse material, terrorist financing, and stolen funds. The top countries that are estimated to receive illicit funds include the United States, Russia, the United Kingdom, Ukraine, Vietnam, Turkey, South Africa, South Korea, and China. Russia dominates the darknet markets by share through Hydra, the world’s largest online darknet market. Interestingly, Hydra only serves Russia and other Eastern European countries that speak Russian. These are just some of the statistics that stood out from the Chainalysis annual cryptocurrency crime report .  WHY IS THIS IMPORTANT? Cryptocurrency analysts including Chainalysis believe that this concentration of cryptocurrency money laundering service providers puts those involved at a greater risk for takedown by authorities. Analysts believe there is a greater concentration of users to few service provider addresses in 2020 due to reliance on a small group of money laundering brokers. A few major crypto money laundering takedowns could cripple the industry (at least temporarily) and force those remaining to look towards other means, potentially away from cryptocurrency altogether. If you have legal questions about cryptocurrency-related fraud or have questions about your own case, then give us a call at Bajoka Law so we can help.