Kais Mohammad, 36, a California resident also known under the moniker Superman29, has confessed to conducting unlicensed cryptocurrency exchange services and laundering up to $25 million. From 2014 to 2019, Mohammad operated an illegal virtual currency business called Herocoin.

According to a press release published by the United States Department of Justice on July 22, Mohammad provided Bitcoin (BTC)-to-fiat exchange services, charging commissions up to 25%. The investigators believe he was aware that some of the funds he dealt with had been obtained illegally.

A failure to maintain AML program

Mohammad failed to maintain an effective anti-money laundering program as he had not registered his Bitcoin automated teller machine (ATM) business with the U.S. Treasury Department’s Financial Crimes Enforcement Network, although he was aware he was obliged to do so. Also, Mohammad never reported suspicious clients.

Mohammad admitted that he exchanged between $15 million and $25 million from in-person exchanges and transactions via Bitcoin ATMs owned by him.

“Mohammad is expected to plead guilty to the charges at a hearing in the coming weeks. Upon pleading guilty, Mohammad will face a statutory maximum sentence of 30 years in federal prison. As part of the plea agreement, Mohammad has agreed to forfeit cash, cryptocurrency, and 17 Bitcoin ATMs that he operated as part of his business,” the release reads.

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