tl;dr
Tornado Cash founder Roman Storm's legal team accuses the government of withholding exculpatory evidence related to claims that noncustodial crypto mixers are money transmitters. Arrested in 2023 for laundering $1 billion, including funds for the Lazarus Group, Storm faced charges that included oper...
Tornado Cash founder Roman Storm’s legal team accuses prosecutors of withholding exculpatory evidence related to noncustodial crypto mixers, alleging a Brady violation that could impact his upcoming trial.
Storm was arrested in 2023 on charges including laundering $1 billion in criminal proceeds, with some funds linked to the Lazarus Group, a sanctioned North Korean cybercriminal entity. Among the charges was operating an unregistered money-transmitting business, but this count was dropped following a Department of Justice memo discouraging regulation of digital assets via prosecution. Prosecutors continue to pursue other allegations.
The defense draws attention to a disclosure from a similar case involving Samourai Wallet, another noncustodial cryptocurrency mixer. Documents revealed an August 23, 2023 conversation between prosecutors and Financial Crimes Enforcement Network (FinCEN) officials, where FinCEN stated that because Samourai did not take custody of cryptocurrency by holding private keys, it likely was not acting as a money services business (MSB).
Storm’s legal team argues that prosecutors’ failure to disclose this information constitutes a Brady violation, which involves withholding evidence favorable to the defendant and may severely prejudice the defense. Such violations can lead to serious legal consequences including conviction reversals, mistrials, or dismissal of charges.
With a trial date set for July 14, the allegation of withheld evidence adds another twist to a high-profile case that underscores ongoing debates around regulation, custody, and legality within the emerging crypto mixer landscape.