Prosecutors within the Samourai Wallet case have denied accusations that they suppressed crucial proof of their legal case towards the crypto mixing service’s two co-founders, Keonne Rodriguez and William Lonergan Hill.
In a letter to the courtroom filed Friday, prosecutors urged Decide Richard Berman of the Southern District of New York (SDNY) to disclaim Rodriguez and Hill’s latest movement for a listening to to litigate the federal government’s tardy disclosure of a dialog between prosecutors and the Monetary Providers Enforcement Community (FinCEN). In that dialog, which passed off six months earlier than prices had been filed, FinCEN officers informed prosecutors that Samourai Wallet didn’t meet their definition of a cash transmitting enterprise and thus didn’t want a license to function.
Regardless of FinCEN’s steering, prosecutors went forward with their case, charging each Rodriguez and Hill with one rely every of conspiracy to commit cash laundering and conspiracy to function an unlicensed cash transmitting enterprise. By Samourai Wallet, prosecutors have alleged that the 2 males “intentionally and successfully laundered over $100 million in crime proceeds of all types” and explicitly marketed their companies to “Dark/Gray Market Participants” together with hackers and fraudsters.
By not telling the protection about their communication with FinCEN till final month, legal professionals for Rodriguez and Hill say the federal government violated due course of — a so-called Brady violation, named for the landmark Supreme Court docket case Brady v. Maryland in 1963, during which the courtroom held that the federal government should hand over any exculpatory or materials proof (principally, something suggesting that the defendant isn’t really responsible of the crime they’ve been charged with) to the protection in a well timed method.
Nonetheless, prosecutors have denied that they’ve dedicated any Brady violations within the Samourai Wallet case. Of their letter to the choose, they laid out a bunch of causes that the timing of their disclosure of the FinCEN dialog was honest play. First, they argued that their dialog with the FinCEN workers represented their “individual, informal and caveated opinions” on whether or not Samourai Wallet would have been required to register as a cash transmitting enterprise, slightly than a proper discovering by the regulator itself.
“Courts have repeatedly held that these types of legal opinions — or opinions of any kind — are not Brady material; facts are Brady material,” prosecutors wrote.
Prosecutors additionally mentioned that, even when the fabric had been related to the protection’s case, they’d turned it over to the protection seven months forward of trial, writing: “There is no need for court intervention when the defendants have received discovery materials sufficiently in advance of trial to effectively use the information.”
In their very own letter to the courtroom earlier this week, legal professionals for Samourai Wallet mentioned that their shoppers had been unfairly prejudiced by the federal government’s lack of disclosure, arguing that it might have impacted the Justice of the Peace choose’s bail determination or the courtroom’s ruling on an early movement to dismiss the case totally.
Prosecutors pushed again towards this argument, saying that the majority of the case towards Samourai Wallet was not tied to the cash transmitting cost and was as a substitute tied to Rodriguez and Hill’s alleged cash laundering scheme — the extra severe of the 2 prices towards them, carrying a hefty 20 12 months most jail sentence.
The back-and-forth over the potential Brady violation comes after the protection requested prosecutors to drop their case beneath the auspices of the so-called Blanche Memo, a latest memo from Deputy Legal professional Basic Todd Blanche, ordering U.S. Division of Justice (DOJ) workers to slender their crypto enforcement priorities. Below the Blanche memo, prosecutors had been ordered to cease pursuing litigation towards crypto exchanges or mixing companies for the actions of their finish customers.
Following the request, prosecutors met with the protection to think about the request on April 10. Almost a month later, the federal government nonetheless has not reached a choice both manner, which some former SDNY prosecutors have characterised as uncommon in conversations with CoinDesk.
