The U.S. Department of Justice on Friday announced criminal charges against the administrators of Russian cryptocurrency exchange Garantex, promoting money laundering by criminals and terrorist organisations, allegedly violating US sanctions.
The two managers are Alexedz Beshkov, 46, a Lithuanian national and resident of Russia, and Alexander Mira Serda, 40, a Russian national living in the United Arab Emirates.
The DOJ said Garantex “received hundreds of millions of criminal revenues and was used to promote a variety of crimes, including hacking, ransomware, terrorism, drug trafficking, and processed at least $96 billion in cryptocurrency transactions since 2019.
In the indictment, prosecutors accused Besiocov of personally allowing transactions related to cybercriminals, including North Korean government hackers known as the Lazaro Group.
The announcement of the charges came the day after a coalition of US Secret Service and law enforcement overthrew and seized Garantex's official website, replacing its content with a banner featuring the agency's logo, and announced the site's seizures.
When TechCrunch reached out to the three Garantex email addresses listed on the official page before Takedown, our email was replied that it had not been deleted. Garantex did not respond to multiple requests for comments via the official Telegram channel.
A banner on display on the official website of the Russian cryptocurrency exchange Garantex. (Image: TechCrunch/Screenshot) Image credit: TechCrunch/Screenshot
Both Besiokov and Mira Sera are accused of money laundering conspiracy, but Besiokov has been accused of conspiracy to violate sanctions and conspiracy, and running a remittance business that does not require licence. Both face up to 20 years' prison for money laundering charges, but Bessiokov faces a maximum sentence of 20 years for conspiracy to violate US sanctions and up to five years to run an unlicensed remittance business.
It is unknown whether the two have been arrested. Justice Department spokesman Shannon Shevlin told TechCrunch that the DOJ doesn't know if Mira Serda was arrested in the UAE.
Two charged Garatex administrators were unable to contact TechCrunch for comment.
US prosecutors argued that Besiocov and Mira Selda knew their crypto exchange was being used for money laundering, and even when Russian authorities asked questions, they worked proactively to make it happen. According to the DOJ, when Russian law enforcement requested records at one point related to Garantex's Mira Serda account, the company provided incomplete information and claimed that “the account was not verified.” ”
“In reality, Garantex had associated the account with Mira Serda's personal identification document,” according to the indictment.
Millions of Crypto have been seized, DOJ confirms
Garantex has been the focus of Western government action for several years.
In 2022, as part of a series of actions against Russia's cybercrime, the US Treasury approved Garantex, referring to an analysis that showed that more than $100 million is associated with illegal actors and the darknet market, and that it is linked to the darknet market, including nearly $6 million from Russia. [Ransomware as a Service] Gang Conti and also include around $2.6 million. [darknet market] Hydra. ”
In 2024, the European Union also approved Garantex as part of a series of sanctions against Russia for its invasion of Ukraine, claiming the exchange was “closely linked to EU-sanctioned Russian banks.”
Despite the sanctions imposed by the US government, Besiocov and his co-conspirators violated the sanctions law by continuing to do business with entities based on the US, “redesigning Gerlantex's operations, avoiding and violating US sanctions and guilty of US companies to violate Gerlantex's uniforms.”
“For example, Garantex has moved its operational crypto wallets to various crypto addresses to make it difficult for US-based crypto exchanges to identify and block transactions with Garantex accounts,” read the DOJ announcement.
The DOJ also said that US law enforcement has frozen more than $26 million in funds used to promote money laundering for Garantex. Chevlin, a spokesman for DOJ, told TechCrunch that the division had frozen Binance (approximately $3 million on Friday) of 23,034,884.75 tethers and 35.57 bitcoins, taking on around $26.2 million.
Even before these enforcement actions, Garantex announced Thursday that it had suspended “all services, including cryptocurrency withdrawals,” after the Stablecoin issuer blocked wallets that belong to Garantex, which holds more than $28 million.
“There's bad news. Tether took part in the war with the Russian crypto market,” Galantex wrote in the announcement on its official Telegram channel. “We're fighting and we won't give up! Be careful with everything [Tether] In Russian, wallets are currently under threat. As always, we are the first, but not the last. ”
After the announcement of DOJ on Friday, Garantex posted a warning to Telegram about “offers to pretend to replace a restored Garantex or withdraw funds.”
“These are all scammers! Their goal is to access users' personal data, wallet addresses and other sensitive information,” reads the announcement in Russian, according to its machine translation.
The announcement also did not mention the website takedown or the indictment of Besshkov and Mira Selda.