DOJ Charges Samourai Wallet Founders in $100M Money Laundering Case

NEW YORK – Federal prosecutors have charged the founders of cryptocurrency service Samourai Wallet with conspiracy to commit money laundering and operating an unlicensed money transmitting business, alleging their platform facilitated over $100 million in illegal transactions.

In an indictment unsealed on April 24, 2024, in the Southern District of New York, the Department of Justice (DOJ) named Keonne Rodriguez, 35, the CEO, and William Lonergan Hill, 65, the Chief Technology Officer, as the defendants. Rodriguez was arrested in Pennsylvania, while Hill was arrested in Portugal, with U.S. authorities seeking his extradition.

The charges center on the operation of Samourai Wallet, a mobile application launched in 2015 that offered cryptocurrency mixing and privacy services for Bitcoin. According to the indictment, the service processed over $2 billion in total transaction volume and served as a haven for criminals to launder illicit funds from sources including dark web markets like Silk Road and Hydra Market, and various computer fraud schemes.

The Allegations: Privacy as a Business Model for Crime

Prosecutors allege that Rodriguez and Hill intentionally designed and marketed Samourai Wallet to attract a criminal clientele. The service operated in two parts: a digital wallet and centralized servers that provided proprietary mixing features, named “Whirlpool” and “Ricochet.”

According to the allegations, these features were specifically engineered to obscure the source and ownership of bitcoin.

* **Whirlpool:** This service acted as a classic crypto mixer, pooling users' bitcoin in large batches before returning it in a way that severed the on-chain link to its origin. * **Ricochet:** This feature added extra, intermediary transactions to a bitcoin transfer, creating a more convoluted path to make tracing more difficult.

The indictment states that the founders collected approximately $4.5 million in fees for these services since 2015. Authorities pointed to the company's own marketing materials, including social media posts on X (formerly Twitter), which openly encouraged users to bypass financial regulations and invited users whose funds were being rejected by regulated exchanges.

“For almost 10 years, Keonne Rodriguez and William Hill allegedly operated a mobile cryptocurrency wallet that gave criminals a virtual haven for laundering over $100 million in crime proceeds,” said IRS-CI Special Agent in Charge Thomas Fattorusso in a statement. “The C.I. special agents in New York are experts in following the complex financial trail, and they have once again unraveled a sophisticated money laundering scheme.”

Focus on Willful Non-Compliance

A central component of the government's case is the claim that Samourai Wallet operated as an unlicensed money transmitting business. Under U.S. law, financial service providers, including crypto mixers, are required to register with the Financial Crimes Enforcement Network (FinCEN) and implement an anti-money laundering (AML) program, which includes collecting know-your-customer (KYC) information.

Prosecutors allege Rodriguez and Hill deliberately chose not to implement these legally required controls. The indictment points to internal communications and public posts where the founders allegedly demonstrated their intent to operate outside the regulatory framework. This lack of compliance, the DOJ argues, was a core part of its business model, designed to appeal to users seeking to evade law enforcement and financial oversight.

U.S. Attorney Damian Williams stated that the defendants “knowingly facilitated the laundering of over $100 million of criminal proceeds from the dark web, and other computer hacking and fraud schemes.”

Following the arrests, law enforcement seized Samourai's web servers and domain, replacing its homepage with a seizure notice from the DOJ. A seizure warrant was also served on Google, effectively removing the Samourai Wallet app from the Google Play Store.

Broader Implications of the Samourai Wallet Money Laundering Case

The indictment of the Samourai Wallet founders represents another step in a broader U.S. government crackdown on cryptocurrency mixing services. This action follows the 2022 sanctioning of Tornado Cash by the U.S. Treasury’s Office of Foreign Assets Control (OFAC) and the subsequent indictment of its developers.

These enforcement actions signal a clear message from regulators and law enforcement: developing and operating services that intentionally obscure financial trails for profit can lead to criminal charges. The government's focus is on the *operation* of a business that facilitates money laundering, rather than on the underlying privacy-enhancing technology itself.

For the cryptocurrency industry, the case underscores the legal risks for developers of privacy-focused tools, particularly those who operate centralized servers, charge fees, and market their services as a way to evade financial controls. It reinforces the expectation that any business engaged in money transmission—crypto or otherwise—must comply with Bank Secrecy Act obligations, including AML and KYC programs. The line between offering a privacy tool and operating an unlicensed money laundering service is becoming a key battleground in crypto regulation.