When is money laundering not money laundering?

When it’s not money, of course.  In a recent case, a judge in Florida declared that bitcoin is not money, and therefore that the man who was accused of selling it to an undercover detective who said that he wanted to use it to buy stolen credit card details could not be charged with money laundering.  The status of bitcoin – other virtual currencies are available – has been under debate almost since it was first mined, and the fact that different countries, and indeed different judges within those countries, are coming to different decisions is not going to help.

As a magistrate I have great respect for judges (that sounds sarky, but it’s really not – I can imagine how difficult it is to make decisions in isolation rather than in discussion with two colleagues), but I do wonder about the reasoning of that judge in Florida, Teresa Pooler, who said that “bitcoin may have some attributes in common with what we commonly refer to as money, but differ in many important aspects – they are certainly not tangible wealth and cannot be hidden under a mattress like cash and gold bars”.  Indeed, but the laundering legislation does not apply only to tangible wealth – it applies to assets and value.  I am also slightly baffled by the reasoning of the defence lawyer, that his client did not launder money but simply “sold his own personal property”… to a man who said that he was going to give it to Russians in exchange for stolen credit card details.  Now I’m a novice at Florida legislation, but if I, for instance, sell my house in Miami to someone who tells me clearly that he is going to turn it into a crack den and brothel, isn’t that a crime of some sort – if not money laundering?

The Florida decision is simply the latest in a long line of contradictory findings.  What is certain is that those who do seek to use bitcoin to move criminal assets will now flock to the Sunshine State, both virtually and in reality.

This entry was posted in Due diligence, Money laundering and tagged , , , , , , . Bookmark the permalink.

3 Responses to When is money laundering not money laundering?

  1. Kate says:

    Hi Susan! I’m really glad you wrote a blog post on this case – I read it a few weeks ago and was also baffled as to why the classification of the bitcoin as ‘not money’ had any bearing on the case.

    Given the increasingly cashless society that we live in, I would be very concerned about a judge only considering ‘tangible wealth’ such as ‘cash and gold bars’ that can be hidden under a mattress!

    Best, Kate

    • Hello Kate – welcome to the blog, and thank you for your comment. Yes, the definition of “money” is a tricky one, particularly when (as in this case) non-expert judges get involved. Perhaps we should campaign for it to be renamed “value laundering”, which would encompass much more than just stuff you can hide under a mattress!
      Best wishes from Susan

  2. Pingback: Going against the currency | I hate money laundering

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.