Florida Court Rules Criminal Charges Can Arise out of Cryptocurrency Transactions

Cryptocurrency is a type of digital currency that is not widely used or understood. As cryptocurrency is a relatively new technological development, many states do not have laws regulating cryptocurrency transactions or case law defining whether the laws the pertain to money and money services should apply to cryptocurrency.

Recently, a Florida appellate court ruled that a defendant could be charged with money laundering and unlawfully engaging in money services business based on transactions involving cryptocurrency If you live in Tampa and are charged with a criminal offense arising out of transactions involving cryptocurrency you should speak with a trusted Tampa criminal defense attorney to determine how to defend against the charges you face.

The Defendant’s Bitcoin Transactions

Allegedly, an undercover detective contacted the defendant regarding the sale of Bitcoins. Bitcoins are a type of cryptocurrency with no backing by the government. The defendant and the undercover detective engaged in several transactions in which the defendant sold the detective Bitcoins in exchange for cash. The defendant was not registered under either the state or federal databases as a “money services business.”

It is reported that during the first transaction the detective indicated that he was involved in illicit activity and wished to remain anonymous, but did not expressly state that he was involved in illegal activity. At the second transaction, the detective advised the defendant that he needed Bitcoins to pay for stolen credit card numbers. At the final transaction, the detective purchased $30,000 worth of Bitcoin which he advised the defendant would be used to purchase additional stolen credit card numbers. The defendant was subsequently arrested and charged with unlawfully engaging in the business of transmitting money while not being registered as a transmitter, and money laundering. The defendant filed a motion to dismiss the information charging him with the alleged crimes, arguing that Bitcoins were not money and the transfer of Bitcoins did not constitute money transmitting. The court granted the defendant’s motion, after which the State appealed.

Laws Pertaining to Cryptocurrency

On appeal, the court declined to adopt the defendant’s argument that he was not unlawfully engaged in the business of transmitting money because Bitcoins did not constitute money. The court stated that although Bitcoins did not fall under the express definition of “currency” in the applicable statute, they did fall under the definition of a “payment instrument,” which is defined as a medium of exchange that may or may not be redeemable in currency. The court ultimately ruled that Bitcoins were a medium of exchange and that the defendant’s business of exchanging Bitcoins for cash required him to register as a money transmitter and payment instrument seller. Regarding the money laundering charges against the defendant, the court found that an issue of fact existed as to whether the defendant possessed the necessary intent. Based on the foregoing, the court held that the trial court erred in dismissing the information against the defendant, and remanded the case for further proceedings.

Schedule a Meeting with a Knowledgeable Tampa Criminal Defense Attorney

The law is not always well-defined when it comes to technological advances. If you are a Tampa resident facing criminal charges, you should retain a knowledgeable criminal defense attorney who will aggressively advocate on your behalf.  William Hanlon of Hanlon Law is a skilled Tampa criminal defense attorney who will work diligently to help you retain your liberties.  You can reach Mr. Hanlon at 813-228-7095 or through the online form to schedule a meeting.

More Blog Posts:      

Man Charged under Florida Computer Crime Law for Allegedly Destroying Company Information After Being Fired, November 1, 2017, Tampa Criminal Lawyer Blog