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Crypto Founder Arrested for $530 Million Sanctions-Busting Scheme: Report

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  • Evita Pay founder Gugnin arrested for allegedly funneling $530 million through crypto for sanctioned Russian banks.
  • DOJ charges Gugnin with wire fraud, money laundering, and operating an unlicensed business amid security concerns.
  • Investigators reveal Gugnin’s awareness of his illegal actions, backed by suspicious web searches on criminal investigations.

Iurii Gugnin, the founder of Evita Pay, has been arrested in New York because his company is accused of bringing over $530 million from sanctioned Russian banks to the U.S. The DOJ is charging him for wire fraud, bank fraud, money laundering, and for operating a business that doesn’t have a license for money transmission. His punishment could be up to life behind bars if he is found guilty.

The DOJ said that Gugnin facilitated stablecoin Tether transactions for Russian customers and some Russian banks that were included on the list of sanctioned entities, such as Sberbank, VTB, Sovcombank, and Tinkoff. Over the period from June 2023 to January 2025, he is reported to have helped Russia get sensitive American technologies by using his company to avoid U.S. sanctions.

Evita Pay’s Role in Eroding U.S. Sanctions Under Scrutiny

In a statement, John A. Eisenberg, Assistant Attorney General for National Security, stated that the operation put the country’s security at risk. The AG pointed out that the DOJ will not allow individuals to take actions that support foreign foes in ignoring U.S. sanctions and export controls. According to the allegations, Gugnin undercut the United States in stopping Russia from getting vital technologies.

The case is centered around U.S. banks being tricked by Gugnin about Evita Pay’s relations to Russia. He supposedly changed invoices to hide who his clients were and not follow Anti-Money Laundering (AML) rules. The DOJ believes that although he registered Evita Pay as a money-transmitting business in Florida, he made false answers when completing the registration paperwork.

Gugnin’s Crypto Crimes Spark DOJ Investigation

The DOJ added that Gugnin realized that his actions were part of criminal activity. Investigators found out that he looked up information on being investigated by typing things like “Am I being investigated?” and queries about possible signs of criminal investigation. According to the searches, Gugnin was aware that he was acting illegally.

He can receive severe sentences. Sentences for bank fraud can add up to 30 years in prison for every count. The most severe penalty for wire fraud is 20 years, and failing to follow AML regulations could result in imprisonment of up to 10 years. Moreover, the founder may be charged with conspiracy to defraud the United States and could face up to five years in prison.

Cryptocurrencies have attracted greater scrutiny for facilitating the evasion of international restrictions and the laundering of funds. Authorities are investigating platforms such as Evita Pay, a crypto pounder, as they attempt to prevent any illegal financial activity. This swift action from the DOJ clearly demonstrates to the public that cryptocurrency should not be used for illicit purposes.

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DOJ Seizes $24M in Crypto From Russian Qakbot Hacker in Global Crackdown

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Key Takeaways:

  • U.S. DOJ targets Russian hacker Rustam Gallyamov with forfeiture of $24M in crypto assets linked to Qakbot malware.
  • Gallyamov’s malware-infected thousands globally, facilitating ransomware attacks with major syndicates.
  • Operation Endgame underscores global cooperation to dismantle cybercriminal infrastructure.

The U.S. Department of Justice has escalated its battle against global cybercrime by filing a civil forfeiture complaint to seize over $24 million in crypto assets linked to Russian national Rustam Rafailevich Gallyamov.

The 48-year-old Moscow resident stands accused of orchestrating a vast malware scheme that powered Qakbot, a sophisticated cyber weapon that infected thousands of computers worldwide.

Gallyamov’s online trial began in 2008 when he reportedly created the first iteration of Qakbot. By 2019, he had built a mature botnet of compromised machines that allowed co-conspirators to conduct ransomware attacks.

Gallyamov’s infrastructure served as a launching pad for infamous ransomware variants including Dopplepaymer, Egregor, REvil, Conti, and Black Basta, according to the indictment. In exchange, he allegedly got a share from the money paid in ransom by victims.

Despite a significant disruption to the Qakbot network in August 2023 by law enforcers, Gallyamov purportedly adjusted rapidly and utilized other methods such as spam bomb attacks.

These entailed inundating victims’ networks with malicious login attempts and fooling workers into providing access to secure networks. Most importantly, the attacks continued through January 2025, reflecting the cybercriminal activity and responsiveness.

Millions in Crypto Now Seized

Gallyamov’s ill-gotten gains were distributed across numerous cryptocurrencies, including more than 200 Bitcoins and significant holdings in USDT and USDC, according to court documents.

In April 2025, U.S. government agents also confiscated a new stash worth more than 30 bitcoin and $700,000 worth of stablecoins from Gallyamov. Those assets worth over $24 million are the target of a civil forfeiture complaint filed in California.

The government’s forfeiture case is aimed at recovering illicit gains and returning them to victims of Gallyamov’s malware operation. Prosecutors Jessica Peck, Khaldoun Shobaki, Lauren Restrepo, and James Dochterman are directing the case and are assisted by FBI field offices and international partners based in Europe and Canada.

A Global Crackdown on Cybercrime

This new development is part of Operation Endgame, a joint multinational operation to take down transnational cybercrime networks. The German BKA investigators, Dutch National Police investigators, France’s Anti-Cybercrime Office investigators, and investigators with Europol played a key role in tracking and taking down Gallyamov’s infrastructure.

With law enforcement agencies from across the continents operating in tandem with each other, Gallyamov’s case represents a turning point in the international campaign against ransomware-based cybercrime.

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Virginia Man Sentenced to 30 Years for Crypto Funding of ISIS Terror

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  • Chhipa used social media and encrypted apps to fund ISIS operations.
  • Over $185K in crypto sent to ISIS members for prison breaks, fighters.
  • FBI and DOJ lead successful crackdown on Chhipa’s crypto terrorism.

A Virginia man, Mohammed Azharuddin Chhipa, has been sentenced to 30 years in prison for cryptocurrency funding of ISIS. Chhipa wired more than $185,000 to female ISIS members in Syria between 2019 and 2022. The U.S. Department of Justice (DOJ) outlined how Chhipa used social media and encrypted applications to collect, launder, and transfer the funds.

Chhipa raised money through online platforms and in-person donations. He then converted the funds into cryptocurrency, which was transferred through Turkey to Syria. Prosecutors state that these funds financed prison breaks and terrorism, which involved the militant activities in Syria.

Chhipa Sentenced For Crypto Terrorism

A federal jury convicted Chhipa in December on five felony counts, which include conspiracy and material support for a terrorist group. On May 7, Federal Judge David Novak sentenced Chhip, citing the severe implications of his activities. The DOJ stated that this case was intended to send a clear message that efforts to finance terrorism will face dire legal consequences.

Furthermore, Chhipa worked with a British-born ISIS member who lives in Syria. This collaborator assisted the accused to organize financial transfers and offered tactical support for ISIS operations. Chhipa used digital assets to conceal transactions and avoid detection in traditional financial systems.

Chhipa tried to escape the U.S. when the FBI launched investigations into his operations. In a bid to cover his tracks, he traveled through several countries but was eventually arrested. The DOJ’s National Security Division and the FBI’s efforts resulted in Chhipa’s return to the U.S. for trial.

Authorities Combat Use of Crypto in Terror Activities

This case demonstrates the increased use of cryptocurrencies by terrorist groups to finance their operations and avoid detection. The DOJ has made remarkable achievements in tracking down cryptocurrency transactions associated with terrorist groups. In 2020, a DOJ operation destroyed several terror-related crypto accounts and seized millions of dollars in digital assets.

In wider counterterrorism attempts, US authorities continue to monitor and disrupt digital financing instruments utilized by ISIS and other groups. These initiatives match the DOJ’s plan to prevent the use of digital assets in illicit activities. The DOJ has pledged to continue its efforts to crack down on digital terrorism financing.

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DOJ Seeks 20-Year Sentence for Celsius Founder Alex Mashinsky

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  • DOJ pushes for 20 years in prison for Celsius founder Mashinsky
  • Celsius founder profited $48 million in fraudulent crypto scheme
  • Mashinsky’s sentencing to reflect severity of crypto fraud impact

The U.S Department of Justice (DOJ) demands a 20-year prison sentence for former CEO of Celsius Network Alex Mashinsky. The DOJ accuses Mashinsky of creating a multibillion-dollar fraud which resulted in major financial losses for thousands of customers. The sentencing will take place on May 8 as prosecutors stress on the need for strict punishment to protect other cryptocurrency markets from frauds.

The DOJ’s sentencing memorandum demonstrates that Mashinsky’s actions were not a mistake. The DOJ argues that his actions were a deliberate scheme to trick customers and exploit the platform for individual benefits. Celsius, valued at more than $20 billion, collapsed in 2022 and resulted in a $4.7 billion loss in customer funds. The prosecutors state that Mashinsky’s crimes led to a loss of about $7 billion at the current cryptocurrency market value.

Alex Mashinsky Pleads Guilty to Celsius CEL Token Fraud

In December 2024, Mashinsky pled guilty to deceiving customers about their investment safety and manipulation of Celsius’ CEL token for personal profits. The DOJ states that Mashinsky received $48 million from the fraudulent scheme. The federal prosecutors accuse him of spearheading a long-term plan to manipulate the price Celsius’ native token and deceive customers about their funds’ security.

The former CEO inflated prices and sold more than $48 million CEL tokens without sufficient disclosure to customers. In July 2022 Celsius was declared bankrupt which caused substantial financial losses to its users and attracted severe legal consequences. The DoJ states that a long prison term demonstrates the severity of Mashinsky’s crimes and deters future crimes in the cryptocurrency sector.

DOJ’s Severe Punishment Protects Crypto Sector

The U.S Department of Justice filed the memorandum just a week before Mashinsky’s court sentencing. The DOJ seeks a severe punishment to condemn Mashinsky and send a message to cryptocurrency executives that fraud will face severe consequences. The court will determine whether or not to issue the proposed 20-year sentence on May 8.

The Celsius fraud also involved the platform’s former chief strategy officer and co-founder Shlomi Daniel Leon. In 2022, Leon resigned from his position before the  company filed bankruptcy. The Federal Trade Commission (FTC) charged Leon and other co-founders like Hanoch Goldstein with financial misconduct which resulted in a $4.7 billion loss.

Alex Mashinsky on the Verge of 20-Year Sentence as DOJ Slams Crypto Fraud Mastermind

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  • The Department of Justice has requested a 20-year prison term for Mashinsky, emphasizing that his actions were deliberate and not a result of negligence.
  • Despite pleading guilty, Mashinsky still refuses to take full responsibility for his fraudulent acts, shifting blame to external factors while personally profiting $48 million from the scheme.

The Department of Justice (DOJ) has requested that the founder of Celsius, Alex Mashinsky, serve a 20-year prison sentence because they believe that his actions didn’t come as a result of negligence or market misfortune but rather a series of calculated and deliberate decisions to lie. Their decision underscored the gravity of his offenses and the damage he inflicted on investors.

One of the co-founders of the collapsed crypto platform, Alex Mashinsky, could spend 20 years in prison if the U.S. Department of Justice gets its way. In a memo filed on the 28th of April, the DOJ asked the court to give him a strong sentence for his role in the platform’s fraud.

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Alex Mashinsky on the Verge of 20-Year Sentence as DOJ Slams Crypto Fraud Mastermind 2

According to them, his actions were not a mistake but instead a purposeful act to scam users. This mistake caused around $7 billion in damage and hurt thousands of people. After Celsius froze withdrawals in June 2022, users lost access to about $4.7 billion in combined crypto assets. The DOJ described Mashinsky’s behavior as a long-running scheme driven by greed and deception.

Mashinsky’s Guilty Plea and Refusal to Take Responsibility

Mashinsky, who admitted guilt in December 2024, misled users about the security of their money and secretly manipulated the CEL token to make a profit.

Despite confessing to the court, he still avoids taking complete responsibility for his actions but instead points fingers at outside forces, including officials, the market, and even the people he stole from. Prosecutors said his actions were not mistakes or poor judgment but clear plans to cheat and steal for personal gain.

He made at least $48 million for himself after causing over $500 million in damage. When the company was still in operation, it claimed to have managed $20 billion in crypto, but behind the scenes, it took big risks, used customer funds to pump token prices, and gave ‘hodl-ers’ false promises.

Although he told investors he was holding CEL tokens, he had actually sold the tokens for millions at its peak. The DOJ wants Mashinsky’s punishment to match the damage done and warn others in the crypto world.

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OKX Re-enters the U.S. Market with Fresh Leadership After $505M DOJ Resolution

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  • OKX has re-entered the U.S. market with a new CEO and a new crypto wallet that supports over 130 blockchains, with the aim of providing more control and transparency for users.
  • The company has settled with the DOJ for $505 million and has now agreed to comply with U.S. regulations and now includes KYC checks and fraud detection.

OKX is returning to the U.S. with a new crypto wallet for U.S. citizens and a new CEO. The company left the U.S. before but is now coming back slowly with a fresh plan.

The crypto company shared the news of its coming back in a blog post on April 16 and also shared that Roshan Robert, a former director at Barclays, will now lead as the CEO in the U.S. A day before the announcement, on April 15, OKX also shared a press release saying the return includes a new Web3 wallet that people can control themselves and a fresh crypto trading platform.

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OKX Re-enters the U.S. Market with Fresh Leadership After $505M DOJ Resolution 4

The company has also added that it is focusing on improving transparency by publishing monthly reserve reports that are verified by an external firm like Hacken.

OKX New Crypto Wallet Launch for U.S.

OKX has also decided to launch a crypto wallet alongside its exchange for U.S. users. According to the report, the wallet would support over 130 blockchains and offer tools for trading, transferring funds between networks, and exploring NFTs and Web3 dApps. It would also have an AI feature that helps users find trending tokens and projects.

The wallet is designed to give users more control and freedom in the decentralized ecosystem. This relaunch comes after OKX’s settlement with the DOJ in February, where it admitted to operating without a license and agreed to comply with U.S. standards under external monitoring until 2027.

The company has now implemented a full compliance framework, including KYC checks and fraud detection.

OKX Relaunches in U.S. With New Leadership, After $500M DOJ Settlement

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  • OKX pays $500 million to settle DOJ allegations, relaunches U.S. arm
  • New U.S. CEO Roshan Robert leads OKX’s regulatory compliance efforts
  • OKX platform offers deeper liquidity and lower fees for U.S. traders

OKX, a Seychelles-based cryptocurrency exchange, has announced plans to reenter the U.S. market. The exchange returned to U.S. operations after a major settlement with the Department of Justice (DOJ), where the company paid $500 million. OKX will provide a U.S.-based wallet and a new platform to serve domestic cryptocurrency traders.

Roshan Robert, the newly appointed U.S. CEO of the company, confirmed that OKX had revamped its technological interface. Robert, a former employee of Barclays and Hidden Road , stressed the company’s commitment to compliance in its operations. OKX has established its regional headquarters in San Jose, California, which demonstrates its long-term commitment to the U.S. market.

OKX Compliance Efforts

OKX relaunched its operations after a huge settlement because its international arm was accused of operating without a money transmitter license. The DOJ claimed that OKX served U.S. customers without proper anti-money laundering procedures. OKX paid a large fine and will hire an external compliance consultant firm until February 2027.

Robert will lead OKX to build an advanced compliance infrastructure and collaborate with U.S. regulators. The company has implemented measures such as Know-Your-Customer (KYC), fraud detection techniques, and continuous market surveillance. These new measures seek to create a secure and transparent trading environment to address past compliance issues.

Crypto Market Expansion

OKX maintains a positive outlook for the U.S. market despite regulatory challenges. According to Robert, the digital asset market continues to grow larger by the year as younger consumers embrace cryptocurrency. OKX’s new platform aims to provide customers with liquidity, low fees, and improved trading tools to compete with major players such as Coinbase and Kraken.

OKX plans to migrate all OKCoin customers to its new platform. The new platform will offer customers improved services that meet the increased demand for crypto trading operations in the U.S. The exchange continues its expansion even as cryptocurrency regulations continue to evolve under the Trump administration.

This U.S. market reentry marks an important milestone for OKX, which previously faced scrutiny for unlicensed operations in the U.S. The exchange seeks to leverage the favorable regulations to ensure future success in the crypto space. OKX plans to collaborate with regulators to boost its reputation and enhance its expansion in the U.S.

DOJ Shuts Down Crypto Enforcement Team, Shifts Focus to Investment Fraud Under Trump-Era Policy

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  • The U.S. Department of Justice has dissolved its National Cryptocurrency Enforcement Team (NCET), shifting its focus from regulating crypto companies to prosecuting fraudsters.
  • This decision aligns with President Donald Trump’s push for simplifying digital asset rules and completely ending the “regulation by prosecution” approach used under the previous administration.

The US Department of Justice has reportedly closed its crypto crime unit, the National Cryptocurrency Enforcement Team. This decision shows a big step in how the government will handle crypto- related cases moving forward, as they take focus from companies to go after people involved in fraud.

On Monday evening, the U.S. Department of Justice announced to its team that it was shutting down the group, which was initially focused on crypto cases. According to a four-page note released by Fortune, Deputy Attorney General Todd Blanche explained the reason for this decision, claiming that the agency should not act as a watchdog for digital assets. 

He also went on to criticize the previous government for using the department to push harsh legal actions in order to control the crypto space. The memo confirmed that the National Crypto Enforcement Team, one of the leading investigators in the field, officially ended the group right away. 

This move follows President Trump’s order to make digital asset rules more straightforward and to stop what his team calls the “regulation by prosecution” used during Joe Biden’s time in office. In the memo, Blanche made it clear that the role of the Department of Justice is not to act like a regulator for crypto.

Moving forward, he stated that the department will only focus on people who scam or harm investors, instead of going after platforms, privacy tools like Tornado Cash, or other apps that let users hold their own crypto assets. Many have seen this step as part of Trump’s growing support for the crypto space and also a fulfillment of making the United States the crypto capital of the planet. 

The Former DOJ’s NCET’s Formation and Actions

The NCET, which was created in 2021 during Biden’s term, brought together experts from different DOJ sections, including cybercrime and money laundering, to handle major crypto-related cases. The group took action against services like Tornado Cash and investigated crypto activities that were linked to North Korean agents.

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DOJ Recovers $7M from Crypto Fraud, Urges Victims to Claim Funds

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  • The U.S. Department of Justice (DOJ) seized $7 million from a fraudulent cryptocurrency scheme and is urging victims to submit petitions to reclaim their stolen funds
  • Fraudsters tricked victims into investing in cryptocurrency through fake platforms, funds went through over 75 bank accounts linked to shell companies, and disguised international transfers.

The U.S. Department of Justice (DOJ) has recovered $7 million linked to a global cryptocurrency scam. The funds were seized through civil asset forfeiture, and the officials plan to return them to those affected. 

On March 21, the DOJ announced the crackdown of a major crypto scam and urged victims to start submitting petitions to claim their stolen money. 

The Scammers Method of Operation

The court documents showed that the scammers used social engineering to trick victims into investing in cryptocurrency through different fake websites. They built trust over time before introducing the victims to fraudulent platforms designed to look like legitimate crypto exchanges.

These websites deceived victims by showing them fake profits while secretly redirecting funds through over 75 bank accounts linked to shell companies. When victims wanted to withdraw their money, the scammers pressured them to send more additional payments, claiming they owed taxes on their ‘supposed’ earnings. 

After the scammers received the funds, they laundered the money quietly by transferring it to different accounts before eventually moving it overseas. In a bid to hide the true sources of these transactions, they disguised the wire transfers as domestic, even though the money was being sent to foreign banks.

DOJ Confirms Plans to Return Forfeited Funds to Victims

In June 2023, Secret Service agents seized a part of the stolen investment funds from an account held by a foreign bank. The U.S. government then filed a civil forfeiture case in the District Court to take legal ownership of the stolen money.

The bank that owned the account filed a claim, leading to a settlement in which $7 million was forfeited to the U.S. This agreement allows victims to request compensation for their losses. The officials went ahead to notify all individuals and organizations that might have been affected by the scam that they can now claim their money and they’ve been given a chance to forfeiture in court both directly and through online announcements. 

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California Sounds the Alarm on 7 New Crypto and AI Scams Amid $6.5M in Losses

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  • California’s financial watchdog uncovered seven crypto and AI scams after 2,668 complaints, exposing fraud tactics that stole millions in 2024.
  • AI-driven scams surged alongside the industry’s $638 billion growth, with criminals exploiting digital finance platforms.
  • Authorities, including Attorney General Rob Bonta and DFPI Commissioner KC Mohseni, intensified crackdowns, shutting down 68 fraudulent crypto websites.

A California financial watchdog has uncovered seven previously unreported crypto and AI-related scams after receiving thousands of complaints in 2024. Fraudsters have been luring victims into elaborate schemes, resulting in millions in stolen funds.

The California Department of Financial Protection and Innovation (DFPI) reported 2,668 complaints this year, exposing deceptive tactics such as fake Bitcoin mining investments and fraudulent crypto gaming platforms. Victims have also fallen prey to fake job offers requiring cryptocurrency transfers and personal data disclosure.

Some reported losing their private keys through deceptive airdrops, while others were tricked into joining sham investment groups on WhatsApp and Telegram. AI-driven investment scams promising impossibly high returns also emerged, leaving users with drained wallets after interacting with fraudulent websites.

AI Boom Fuels Cybercrime Wave

The surge in AI-related scams coincides with the industry’s explosive growth, which saw its market value soar to $638 billion in 2024, according to Precedence Research. However, this expansion has also fueled a rise in crimeware-as-a-service (CaaS), where seasoned cybercriminals sell hacking tools to amateurs.

California Attorney General Rob Bonta warned, “As scammers grow increasingly sophisticated and calculated, so must our enforcement.” DFPI Commissioner KC Mohseni also urged users to verify domains carefully and stay alert to crypto recovery scams masquerading as legitimate services.

Authorities have ramped up efforts to combat these threats, shutting down 26 fraudulent crypto websites in collaboration with the state. Despite these efforts, scammers continue to adapt, exploiting the growing interest in digital assets and AI-based financial platforms.

Millions Lost in Crypto Scams Across California

California’s Department of Justice (DOJ), in partnership with DFPI, took down 42 fraudulent crypto websites in 2024, collectively defrauding victims of $6.5 million. The average loss per victim reached a staggering $146,306, highlighting the scale of the problem.

A March 10 statement from the DOJ acknowledged that international fraudsters orchestrate many of these scams, making prosecution and arrests challenging. The agency noted that common red flags included exaggerated investment returns, a lack of contact information, sign-up prizes, and missing listings on reputable industry websites like CoinMarketCap.

Meanwhile, an on-chain security firm, Cyvers, identified pig butchering schemes as one of the costliest scams of 2024, estimating losses of over $5.5 billion across 200,000 cases. Blockchain security firm CertiK also flagged phishing attacks as the year’s biggest security threat, with 296 incidents causing $1 billion in losses.

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