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Home»HACKING NEWS»A judge has ruled that the Tornado Cash co-founder will stand trial on money laundering charges.
HACKING NEWS

A judge has ruled that the Tornado Cash co-founder will stand trial on money laundering charges.

By Crypto FlexsSeptember 28, 20242 Mins Read
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A judge has ruled that the Tornado Cash co-founder will stand trial on money laundering charges.
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  • Roman Storm is scheduled to go to trial on December 2 on charges of money laundering through Tornado Cash.
  • The judge rejected Storm’s defense that his code was protected under the First Amendment.
  • But prosecutors must prove that Storm knew he was handling the proceeds of a specific crime.

Roman Storm, co-founder of cryptocurrency mixing service Tornado Cash, is scheduled to go on trial in New York on December 2, 2024, after a US federal judge denied his motion to dismiss money laundering charges.

Judge Katherine Polk Failla of the Southern District of New York denied the dismissal during a conference call on September 26 and adjourned the case to trial.

Tornado Cash founders face multiple charges

Storm, along with co-founder Roman Semenov, are facing various charges, including conspiracy to launder money, conspiracy to violate the International Economic Emergency Powers Act (IEEPA), and conspiracy to operate an unlicensed money transfer business.

The charges stem from allegations that Tornado Cash helped launder more than $1 billion in criminal proceeds, some of which were linked to the North Korean-backed cybercrime group Lazarus.

In a motion to dismiss the charges, Storm’s legal team argued that his role in developing the Tornado Cash software was protected under the First Amendment.

But Judge Failla rejected this argument, arguing that the “functional capacity” of the code was not equivalent to free speech as defined in the First Amendment. She stressed that the government’s efforts to combat money laundering and sanctions evasion were “entirely unrelated” to suppressing freedom of expression.

The court also ruled that control was not a necessary element of the charges under the 1960 statute and rejected arguments that Storm had to have knowledge of specific criminal activity. Instead, prosecutors must prove only that Storm knew he was handling the proceeds of crime.

The judge rejected the due process claim, saying Storm’s mental state and intent were a matter for the jury to decide.

Judge Failla further noted that Tornado Cash was not “meaningfully different” from traditional financial services and money transfer companies, making Storm liable under existing law.

The trial, expected to last two weeks, could set a precedent for how software developers’ skills are treated under U.S. law when they are used for illegal purposes. Storm co-founder Roman Semenov still remains with the company.


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