A bid to get the case thrown out due to the technical definition of money laundering is denied.
The former proprietor of the drugs and vice bazaar known as Silk Road has suffered a major legal setback, after a US court denied his defense’s request to have the case dismissed.
The federal charges against Ross Ulbricht, better known by his online handle Dread Pirate Roberts, include money laundering, running a criminal enterprise, narcotics conspiracy and conspiracy to commit computer hacking. In the state of Maryland he has been indicted for one planned murder.A lawyer representing Ulbricht had sought to have most of the charges thrown out because of technicalities and lack of overall evidence connecting Ulbricht to Dread Pirate Roberts which is particularly important when painting him as the ringleader or mastermind of the operation.
One of the arguments presented by Ulbricht’s defense team is that Ulbricht can’t be charged for money laundering, since Bitcoin itself does not universally fall under the legal definition of money, thus, since Ulbricht dealt exclusively with Bitcoin, he was not laundering money.
“[The charge of] money laundering, is defective because it fails to allege sufficiently an essential element of the offense – that Mr. Ulbricht engaged in, or conspired to engage in, ‘financial transactions’ – as Bitcoin, the alleged ‘payment system that served to facilitate the illegal commerce conducted on the site,’ does not constitute either ‘funds’ or a ‘monetary instrument, either of which is a necessary component of ‘financial transaction,” Ulbricht’s attorney wrote in an earlier filing.
Unfortunately for Ulbricht the presiding judge on the case, US District Judge Katherine Forrest, said that Bitcoin — despite not being classified as a currency — counts as a “medium of exchange” and legal boundaries exist for a variety of interpretations for what constitutes money laundering.
“There is no doubt that if a narcotics transaction was paid for in cash, which was later exchanged for gold, then converted back to cash, that would constitute a money laundering transaction. One can launder money using bitcoin,” she wrote in the filing.
The trial is expected to begin in early November.
As for Silk Road, it remains in operation headed by another “Dread Pirate Roberts”.