Samourai Pockets’s attorneys allege federal prosecutors suppressed recommendation that the agency didn’t want a license earlier than they charged executives on the crypto mixing service months later.
In a Could 5 letter to a Manhattan federal court docket, attorneys for Samourai co-founders Keonne Rodriguez and William Hill mentioned prosecutors disclosed that the US Treasury Division’s Monetary Crimes Enforcement Community (FinCEN) representatives advised them six months earlier than they charged the pair “that underneath FinCEN’s steering, the Samourai Pockets app wouldn’t qualify as a ‘Cash Providers Enterprise’ requiring a FinCEN license.”
“Shockingly, six months later, the identical prosecutors criminally charged Keonne Rodriguez and William Hill with working simply such a enterprise with no FinCEN license,” the attorneys added.
The letter claimed that prosecutors had been required to share their discussions with FinCEN over Samourai two weeks after they unsealed expenses, making the deadline Could 8 final 12 months, however as a substitute “suppressed this data for over a 12 months, disclosing it solely on April 1, 2025.”
Prosecutors charged Samourai CEO Rodriguez and its know-how chief Hill with conspiracy to function an unlicensed cash transmitting enterprise and cash laundering conspiracy in February 2024, unsealing the charges and arresting the pair in April that 12 months.
Samourai’s mixing service took crypto from a number of customers and blended it collectively to cover its origins. The federal government alleged the platform helped with over $2 billion in unlawful transactions and facilitated over $100 million value of cash laundering transactions from on-line black markets and scammers.
Rodriguez and Hill each pleaded not responsible.
Within the letter, their attorneys mentioned prosecutors shared particulars of a name with Kevin O’Connor, chief of FinCEN’s Digital Property and Rising Expertise Part within the Enforcement and Compliance Division, and Coverage Division staffer Lorena Valente.
In response to an e-mail from one of many prosecutors summarizing the decision, FinCEN mentioned that “as a result of Samourai doesn’t take ‘custody’ of the cryptocurrency by possessing the non-public keys to any addresses the place the cryptocurrency is saved, that might strongly recommend that Samourai is NOT performing as an MSB [money services business].”
The e-mail mentioned O’Connor and Valente agreed that the federal government may attempt to argue that Samourai functionally managed the crypto, “however that has by no means been addressed within the steering, and so it may very well be a troublesome argument” for prosecutors.
Samourai’s attorneys requested the court docket for a listening to “to find out the circumstances surrounding the Authorities’s late disclosure” and to manage a treatment.
Samourai to resume dismissal bid if case goes on
Rodriguez and Hill’s attorneys mentioned that, utilizing this newest data, they’d once more ask for the costs to be dismissed, arguing they lacked truthful discover and “understood they had been performing lawfully.”
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Prosecutors and Samourai asked the court for more time on April 28 to contemplate doubtlessly dismissing the case after the Justice Division rolled again its crypto enforcement.
Rodriguez and Hill bid to dismiss the case in early April, arguing it must be dropped as Deputy Legal professional Basic Todd Blanche mentioned in an April 7 memo that the Justice Division wouldn’t prosecute crypto mixers for “unwitting violations of laws.”
Within the newest letter, their attorneys mentioned if the federal government “had been to withstand the Blanche Memo’s directive and push ahead,” then they’d bid to dismiss as “in the event that they weren’t cash transmitters underneath FinCEN’s steering, then they might not probably be prosecuted for not having a license.”
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