Samourai Wallet Founders Charged in $100M Money Laundering Scheme

NEW YORK, NY – Federal authorities have arrested and charged the founders of the cryptocurrency mixing service Samourai Wallet with conspiracy to commit money laundering and operating an unlicensed money transmitting business. The indictment, unsealed in the Southern District of New York on April 24, 2024, alleges that Keonne Rodriguez, 35, and William Lonergan Hill, 65, operated a platform that facilitated more than $2 billion in unlawful transactions and laundered over $100 million in criminal proceeds.

Keonne Rodriguez, the CEO and a co-founder, was arrested in Harmony, Pennsylvania, while William Lonergan Hill, the CTO and another co-founder, was arrested in Portugal and is awaiting extradition to the United States. According to the U.S. Department of Justice (DOJ), Samourai Wallet was marketed and designed as a service for criminals to hide the source of illicit funds.

The Allegations: A Hub for Illicit Finance

The indictment alleges that from its creation in 2015, Samourai Wallet was positioned as a tool for financial privacy that explicitly catered to an illicit client base. The platform offered a mobile wallet and two key services designed to obscure the link between cryptocurrency transactions: “Whirlpool,” a crypto mixing service, and “Ricochet,” a feature that added intermediary transactions to a transfer.

"As alleged, Keonne Rodriguez and William Hill are responsible for developing, marketing, and operating Samourai Wallet, a cryptocurrency mixing service that executed over $2 billion in unlawful transactions and served as a haven for criminals to engage in large-scale money laundering," said U.S. Attorney Damian Williams for the Southern District of New York. Williams added that the founders knowingly facilitated the laundering of proceeds from notorious dark web markets like Silk Road and Hydra Market, as well as funds from various computer fraud and ransomware schemes.

The charges state that the service earned millions in fees from these operations. For the Whirlpool service, the platform charged a fee for each mixing cycle, and for Ricochet, it charged a fee for each extra “hop” added to a transaction to obfuscate its origin.

Marketing to Criminals

Prosecutors claim that Rodriguez and Hill were not merely passive developers of a neutral privacy tool. The indictment points to marketing materials and social media posts where the founders allegedly solicited criminal business. In public communications and private support channels, they are accused of instructing users on how to launder crime proceeds, including funds from sanctioned Russian oligarchs.

According to the DOJ release, the founders openly discussed their opposition to financial regulations and their intent to operate outside the scope of U.S. anti-money laundering (AML) and know-your-customer (KYC) laws. This included a failure to register their business as a money services business with the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN), a legal requirement for such operations.

"Threat actors use mixers to try and hide their illicit cryptocurrency proceeds, but the IRS-CI special agents, with the help of their law enforcement partners, are the best in the world at unraveling complex financial transactions," stated IRS-CI Acting Special Agent in Charge Thomas Fattorusso.

The Takedown and International Cooperation

The enforcement action was a coordinated effort involving the DOJ, IRS Criminal Investigation (IRS-CI), and the Federal Bureau of Investigation (FBI), with significant assistance from international partners. Law enforcement in Iceland and Portugal played a key role, particularly in the seizure of Samourai Wallet’s web servers and domain in Iceland and the arrest of Hill in Portugal.

A seizure warrant was also issued authorizing the confiscation of the Samourai Wallet mobile application from the Google Play Store.

Both Rodriguez and Hill are charged with conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison, and conspiracy to operate an unlicensed money transmitting business, which carries a maximum penalty of five years.

What This Means

The charges against the Samourai Wallet founders represent a clear continuation of the DOJ's aggressive stance against cryptocurrency mixing services that facilitate illicit finance. Following similar actions against platforms like Tornado Cash and Bitcoin Fog, this case underscores that developers and operators who actively market their services for criminal use cannot claim protection as neutral software providers.

The action sends a stern warning to the cryptocurrency industry that AML and KYC regulations are not optional. For compliance officers and financial institutions, it highlights the increasing scrutiny on anonymity-enhancing technologies and the legal risks associated with engaging them. Law enforcement agencies have demonstrated a growing capacity to trace blockchain transactions and work with international partners to dismantle services they deem to be criminal enterprises, regardless of where their infrastructure is hosted or their founders reside.