Feds Charge Crypto Founder With Evading U.S. Sanctions, Laundering $500M

Federal prosecutors have charged a New York-based crypto firm founder with laundering greater than $500 million by means of the U.S. monetary system whereas serving to sanctioned Russian banks circumvent worldwide restrictions.

Iurii Gugnin, 38, a Russian citizen and founding father of crypto fee corporations Evita Investments Inc. and Evita Pay Inc., was arrested Monday on a 22-count indictment alleging he turned his companies into what prosecutors known as “a covert pipeline for soiled cash.”

Gugnin facilitated transactions with sanctioned Russian banks together with Sberbank, VTB Financial institution, and Tinkoff Financial institution between June 2023 and January 2025, in line with the Justice Division’s press launch.

His operations allegedly helped Russian prospects purchase delicate U.S. know-how and nuclear supplies whereas evading worldwide sanctions.

The defendant faces extreme penalties, with every financial institution fraud depend carrying a most 30-year jail sentence and extra expenses punishable by as much as 20 years imprisonment.

“ know if there’s an investigation in opposition to you”

The case factors to mounting issues amongst nationwide safety officers about how crypto infrastructure is being weaponized to undermine sanctions designed to cripple Russia’s battle financial system in Ukraine.

Gugnin is accused of transferring roughly $530 million by means of U.S. banks and crypto exchanges, primarily utilizing the stablecoin Tether (USDT).

The indictment claims he repeatedly deceived monetary establishments, falsely asserting that Evita “didn’t conduct enterprise with entities in Russia and didn’t cope with sanctioned entities.”

Nonetheless, prosecutors say he maintained private accounts at sanctioned Russian banks JSC Alfa-Financial institution and Sberbank whereas residing in america.

The scheme reportedly concerned overseas prospects sending Gugnin crypto, which he then laundered by means of wallets and U.S. financial institution accounts, changing to {dollars} and making funds by way of Manhattan banks on their behalf.

Prosecutors say Gugnin facilitated funds for export-controlled U.S. tech servers and laundered funds for Rosatom, Russia’s state nuclear firm, allegedly “whiting out” Russian buyer particulars on invoices to hide the actions.

Court docket paperwork reveal he performed web searches for phrases together with, “how you can know if there’s an investigation in opposition to you,” “cash laundering penalties US,” and “penalties for sanctions violations EU luxurious items,” the press launch mentioned.

Crypto and sanctions

The Gugnin case represents the newest in an sweeping collection of U.S. actions focusing on Russian cryptocurrency operations that processed billions in illicit transactions.

“For the reason that 2022 invasion of Ukraine, the worldwide neighborhood has deployed a broad vary of economic sanctions in opposition to Russia, severely limiting its entry to the standard monetary system,” Chengyi Ong, Head of APAC Coverage at Chainalysis, instructed Decrypt. “As a substitute fee channel, cryptocurrency has been used—and can doubtless proceed to serve—as a device to sidestep sanctions.”

Sanctioned jurisdictions acquired $15.8 billion in crypto in 2024, accounting for about 39% of all illicit crypto transactions globally, in line with a February report by blockchain analytics agency Chainalysis.

Ong famous that Russia’s 2023 legalization of crypto for worldwide funds mirrored this shift, although conventional evasion techniques like shell corporations stay frequent.

And for her, blockchain’s inherent transparency gives a vital benefit in combating such schemes.

“Improved compliance applications supported by blockchain evaluation have contributed to a measurable decline in alternate interactions with sanctioned entities, demonstrating the effectiveness of data-driven de-risking methods,” Ong mentioned.

Latest enforcement actions have shut down a number of Russian-linked crypto platforms, together with 47 Russian-language no-KYC exchanges seized by German police in “Operation Closing Alternate” and Russia-based Cryptex, which processed over $5.88 billion since 2018.

In March, worldwide businesses seized the sanctioned Russian alternate Garantex, which had dealt with over $100 billion in transactions and accounted for 82% of all crypto volumes related to sanctioned entities at its peak, in line with Chainalysis information.

Blockchain intelligence agency TRM Labs just lately concluded that newly-launched alternate Grinex is probably going a rebrand of Garantex, with the brand new platform onboarding former Garantex customers and redistributing their property by means of ruble-pegged stablecoin A7A5.

“The broader subject right here is that rebranding has develop into a well-known tactic for sanctioned crypto entities,” Andrew Fierman, Head of Nationwide Safety Intelligence at Chainalysis, then instructed Decrypt.