Tornado Cash founder Roman Storm’s legal team is accusing the government of withholding information from the court.
Storm was arrested in 2023 and slapped with charges related to allegedly laundering $1 billion in criminal proceeds, including hundreds of millions of dollars for the Lazarus Group, the sanctioned North Korean cybercriminal outfit.
The Tornado Cash founder was also charged with operating an unregistered money-transmitting business, though that part of the indictment was dropped earlier this month in accordance with an April Department of Justice (DOJ) memo that encouraged an end to digital asset “regulation by prosecution.” The prosecutors are still pursuing the other charges.
Now, Storm’s lawyers claim government prosecutors have held onto exculpatory materials since 2023 regarding their claims that noncustodial crypto mixers can act as money transmitters.
“A recent filing in a similar prosecution involving Samourai Wallet, a noncustodial cryptocurrency mixer, revealed that, on August 23, 2023, S.D.N.Y. prosecutors had a previously undisclosed call with senior officials from the Financial Crimes Enforcement Network (FinCEN)…
During that call, FinCEN officials stated that because Samourai ‘did not take ‘custody’ of the cryptocurrency by possessing the private keys to any addresses where the cryptocurrency is stored, that would strongly suggest that Samourai is NOT (emphasis in original) acting as an MSB [money services business/money transmitting business].’”
Even though the government has dropped the unregistered money-transmitter portion of the indictment, Storm’s lawyers still claim that the failure to disclose those documents constitutes a “Brady violation” and has “materially prejudiced” the Tornado Cash founder’s defense.
Brady violations involve prosecutors failing to disclose pertinent evidence that would help a defendant’s case. They can result in conviction reversals, mistrials, charge dismissals and/or prosecutorial misconduct charges.
Storm’s trial is scheduled for July 14th.
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