Russia is looking at jail time for anyone who helps cryptocurrency fraudsters transfer funds

Russia is looking at jail time for anyone who helps cryptocurrency fraudsters transfer funds

Law enforcement officials say they have been registering a growing demand for the services of so-called “droppers” — people who are willing to help crypto fraudsters with laundering illegally obtained funds, Russian crypto news outlet reported.

These individuals play a role in fraudulent schemes that allows organizers to cash out the stolen funds. Some droppers may not even realize they are involved in an illegal activity, but that doesn’t mean they won’t be held accountable in Russia.

The interior ministry proposes to define the activity as a separate offense, with all the ensuing consequences, explained Jamali Kuliyev from the Yukov and Partners law firm. This would allow Russian courts to impose the maximum sentence, he pointed out.

Roman Bubnov, deputy head for departmental and procedural control at MVD’s Investigative Department, admitted that the authorities want to introduce criminal liability for such actions. If that happens, droppers may get between four and seven years of prison time.

Story Highlights

  • Russian Law Enforcement Targets Droppers Associated with Scam Crypto Schemes
    The Russian Federation’s Ministry of Internal Affairs (MVD) and other security organisations want to make it illegal for people to help con artists who take advantage of the popularity of cryptocurrency investments.

  • A dropper is usually someone who was offered to accept illicit funds to their bank account or crypto wallet. The person can then buy cryptocurrency, split the amount between several wallets, or withdraw the money.

Russia is yet to comprehensively regulate its crypto space, with new legislation expected to be adopted this fall. In early May, a top central bank official revealed that more than half of all financial pyramids identified in the first quarter of this year were linked to cryptocurrencies.

In June, a bill introducing penalties for unauthorized issuance of digital financial assets was submitted to the State Duma, the lower house of Russian parliament. The draft law was filed by the Chairman of the Financial Market Committee Anatoly Aksakov who is also involved in the efforts to regulate crypto transactions in the country.