The operator of Coin.mx was sentenced to five and a half years in prison for operating an unlicensed bitcoin exchange. Anthony Murgio, 33, plead guilty to 3 counts of conspiracy which included operating an unlicensed money transmitting business and bank fraud. Coin.mx was also suspected of assisting hackers launder cryptocurrency and linked to a breach of data at JPMorgan & Chase. Nine individuals have been charged with felonies regarding the data hack. Over 83 million accounts were breached.
Manhattan U.S. District Judge Alison Nathan said it was “An effort based on ambition and greed”, and Mr. Murgio as having created a “pyramid of lies”. “Believing what I was doing was OK did not make it OK,” Murgio claimed. “I am wiser today than when the case began, and I am sorry for all the damage I caused to so many people.” He showed "enormous regret” and lost his composure multiple times during sentencing. Full article here: https://news.bitcoin.com/coin-mx-operator-sentenced-to-five-and-a-half-years-in-prison/
My Comment
This scares the shit out of me. 1) I own a bitcoin ATM and although the State of Michigan does not require a Money Transmitter License the FEDs might. 2) Another guy in the Western District of Michigan was charged for nearly the same thing. I am AML compiant and have registered my business, Gold Keys, Inc., with FinCen and as an MSB. This all new space to me and being naive about the law could be bad news.
Every State is different regarding how they handle cryptocurrency businesses. Make sure you read about the specific laws that govern your State and make contact with them. I had a State representative send me an email saying "no money transmitter licensed is required in the State of Michigan."
Money transmission is required when any monies are moved across state lines. Peer to peer transactions are not counted, as far as I know. I am not an expert though, so take that with a grain of salt. Always know the law first, things can spin out of control really fast if you don't. Careful people.