Vietnamese resident accused by the FBI of laundering $3 billion through Bitcoin mixer ChipMixer

On March 15, 2023, the U.S. Department of Justice announced the takedown of ChipMixer, a darknet cryptocurrency “mixing” service that laundered over $3 billion worth of cryptocurrency for cybercriminals, fraudsters, and state-sponsored actors between 2017 and 2023.

This coordinated international operation involved the seizure of two domains, one Github account, and the German Federal Criminal Police’s seizure of the ChipMixer back-end servers and over $46 million in cryptocurrency.

As ChipMixer was taken down, Minh Quốc Nguyễn, a 49-year-old Vietnamese operator, was charged by the Justice Department for money laundering, running an unlicensed money transmitting business, and identity theft. Minh developed and managed the online system that ChipMixer used and also advertised the service on the internet. From August 2017 to March 2023, Minh participated in illegal activities on ChipMixer.

The FBI issued a wanted notice for Minh Quốc Nguyễn | Source: FBI

According to the Pennsylvania law firm, Minh may face a maximum sentence of 40 years in prison, along with charges of identity theft and operating an unlicensed money transmission business. Minh is accused of creating and operating the online infrastructure used by ChipMixer. The US alleges that Minh advertised the online protocol and advised customers on how to bypass identity verification (KYC) and anti-money laundering (AML) laws.

According to court documents, ChipMixer allowed customers to deposit bitcoin, which was then mixed with other users’ bitcoin, commingling the funds in a way that made it difficult for law enforcement or regulators to trace the transactions. The service offered numerous features to enhance its criminal customers’ anonymity and concealed the operating location of its servers to prevent seizure by law enforcement. ChipMixer serviced many customers in the United States but did not register with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) and did not collect identifying information about its customers.

ChipMixer had a significant criminal clientele and became indispensable in obfuscating and laundering funds from multiple criminal schemes. Between August 2017 and March 2023, ChipMixer processed over $17 million in bitcoin for criminals connected to approximately 37 ransomware strains, over $700 million in bitcoin associated with wallets designated as stolen funds, more than $200 million in bitcoin associated either directly or through intermediaries with darknet markets, over $35 million in bitcoin associated either directly or through intermediaries with “fraud shops,” and bitcoin used by the Russian General Staff Main Intelligence Directorate (GRU) to purchase infrastructure for the Drovorub malware.

Deputy Attorney General Lisa Monaco said, “Today’s coordinated operation reinforces our consistent message: we will use all of our authorities to protect victims and take the fight to our adversaries. Cybercrime seeks to exploit boundaries, but the Department of Justice’s network of alliances transcends borders and enables disruption of the criminal activity that jeopardizes our global cybersecurity.”

FBI Deputy Director Paul Abbate added, “We will not allow cybercriminals to hide behind keyboards nor evade the consequences of their illegal actions. Countering cybercrime requires the ultimate level of collaboration between and among all law enforcement partners. The FBI will continue to elevate those partnerships and leverage all available tools to identify, apprehend and hold accountable these bad actors and put an end to their illicit activity.”

The takedown of ChipMixer is a significant step in combating the use of cryptocurrency in illegal activities. This operation sends a strong message to other darknet cryptocurrency services that law enforcement agencies are committed to using all their available authorities to protect victims and take down these criminal networks.

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