Founder of Helix Crypto Mixer Faces US DOJ Lawsuit to Collect $60 Million in Civil Penalties
The crypto space is not only extremely full of surprises. It is also full of pitfalls and is difficult to navigate and understand most of the time.
Even when some entities think they are not breaking the law, they sometimes end up doing it.
One wrong move and they end up being sued and asked to cough up millions to compensate for damages for their actions that they thought were right.
It’s probably the kind of lesson that was learned the hard way defendant crypto mixer Helix founder Larry Harmon.
The Ohio native was the subject of a lawsuit filed in federal court in Washington DC. The goal: To collect the $60 million civil penalty that came as a consequence of his failure to establish an effective anti-money laundering mechanism back in 2020, Reuters and other news outlets reported Friday.
Harmon’s cryptomix that turned into his biggest nightmare
A well-known misconception with leading cryptocurrency Bitcoin is that the real identity of the wallet holders is completely hidden.
Those who fully understand how crypto works have developed ways to know who owns a particular wallet.
Such privacy considerations would eventually give way to entry Bitcoin mixers or “tumble” to the crypto room.
Bitcoin Mixing CEO Larry Harmon. Image: Coincu News.
Essentially, this is software that accepts Bitcoin from users. The crypto is mixed in such a way that no one can identify who sent what. It then sends out various BTC to intended destinations.
Along these lines, in 2014, Harmon founded Helix which was able to hide the owner or sender of virtual currency. It worked until 2017.
But it appears that in doing so he violated the Federal Bank Security Act (BSA) and was eventually sued by the Financial Crimes Enforcement Network (FinCEN) under the US Treasury Department.
Prosecutors argued that Helix was a unlicensed money transfer business. Harmon pleaded guilty to the charges but was not sentenced.
Shallow defense did not help Harmon’s case
Charles Flood, the lawyer who represented Harmon, built the defendant’s defense on the notion that his client never intended to break the law and “if he had known in 2014 that it was illegal to use a Bitcoin glass, he would never have done it .”
But this was not enough to defend Harmon as per FinCEN, failed to collect and verify the names and addresses as well as contact numbers of those involved in more than 1.2 million Bitcoin transactions that occurred between June 2014 and December 2017.
After all, as the sages would say, “Ignorance of the law excuses no one.”
The time has come for Harmon to own up to his actions and face the consequences.
FLOW total market cap at $1.45 billion on the daily chart | Featured image from Coindoo, Chart: TradingView.com Disclaimer: The analysis represents the author's personal views and should not be construed as investment advice.
