Tornado Cash Sanctions Reversal Has No Effect on Developers' Trial, Says DOJ

• In a motion filed on January 17, 2025, the US Government continues to accuse Roman Storm and his associates of aiding the Lazarus Group in money laundering by funding infrastructure, maintaining algorithms, and leveraging smart contracts to enhance the anonymity for Tornado Cash users.
• On December 18th, Roman Storm has renewed his bid to dismiss money laundering and sanctions violation charges, citing a recent Fifth Circuit decision that found the company's smart contracts were not a sanctionable property.
• The US Department of Justice (DOJ) prosecutors now claim that the sanctions reversal doesn't impact the criminal trial against Tornado Cash developers, adding that the case is about control over the Tornado Cash user interface, not the validity of the sanctions.
• The filing repeats that Storm intentionally took part in and facilitated money laundering transactions and can be held liable for this conduct, even if the transactions could have occurred without his deliberate involvement.

"The defendant [...] regurgitates arguments about the supposed requirement that a money transmitting business have "custody" or "control" of the funds being transferred. For the reasons already briefed at length, that argument is meritless and finds no support in the statute or the case law," was stated in the argument.

• "The Government's opposition highlights the DOJ's continued willingness to leverage criminal enforcement as a tool to shape the law – in this case specifically to introduce FATF recommendation 66 on the classification of non-custodial UIs as a category of a "Virtual Asset Service Provider", which have not yet been adopted by the US," writes L0la L33tz for The Rage.

The Rage Article / Archive
DOJ Filing

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