By EZ in News — Apr 29, 2024

DOJ Challenges Tornado Cash Developers' Motion to Dismiss Criminal Indictment

The U.S. Department of Justice pushed back against Tornado Cash developer Roman Storm's motion to dismiss criminal indictment against him, claiming that Tornado Cash acted as a money transmitting business.

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In a 111 page filing on Friday, the Department of Justice (DOJ) disputed how the defense characterized Tornado Cash, saying it was announced in 2019 as a mixer and the overall service includes a website, user interface, a combination of smart contracts and a network of 'relayers.'

"The Indictment clearly alleges that the Tornado Cash service was a commercial enterprise carried on for profit or financial [sic] gain and that the defendant himself profited from its operation through his control, with others, of key components of the integrated Tornado Cash service," was stated in the motion.

"The very success of the Tornado Cash service in laundering enormous amounts of criminal proceeds shows the need for restrictions," argue the prosecutors.
"The indictment lays out one picture of this success, in the form of $2.7 million in Tornado profit that it says Storm transferred to cold wallets that have still not been identified. Storm also accessed Binance using a VPN and an account under a false identity to cash out other Tornado Cash proceeds," reports The Block.
In the summer of 2023, the DOJ charged Tornado Cash developers Roman Storm and Roman Semenov with conspiring to commit money laundering, conspiring to operate an unlicensed money transmitter and conspiring to violate sanctions law.

"The Government has not charged the defendant with a crime that involves solely writing code or maintaining a website. Rather, the charged offenses require the Government to prove that the defendant conspired to conduct financial transactions designed to conceal criminal proceeds (Count One), operate a money transmitting business (Count Two), and receive or provide goods or services to sanctioned entities or deal in blocked property (Count Three)," explains the Fridays filing.

Lawyers representing Storm s ought to dismiss the indictment at the end of March. They contended that Tornado Cash does not qualify as a custodial mixing service or a "financial institution", as defined by law. Additionally, they argued that Storm was unable to exercise control over the service or prevent its use by cyber criminal groups.
The trial of Roman Storm is set to begin this September. The U.S. has not yet arrested Roman Semenov. Another Tornado Cash co-founder, Alexey Pertsev, is currently facing a money laundering trial in the Netherlands. In his case, the judge is expected to deliver the verdict on May 14.