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Crime The Almighty Buck

LibertyReserve.com Shuttered, Founder Arrested In Spain 138

Posted by samzenpus
from the long-arm-of-the-law dept.
hypnosec writes "Libertyreserve.com has been shut with the founder arrested by police in Spain this week over his alleged involvement in money laundering. Libertyreserve.com has been down for over three days now and the arrest seems to be the reason behind the outage. Arthur Budovsky Belanchuk, a 39-year-old male, has been arrested by Spanish authorities as a part of their ongoing investigations into money laundering. U.S. officials may very well seek his extradition."
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LibertyReserve.com Shuttered, Founder Arrested In Spain

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  • he is not going to an resort prison no for that it's FMITA prison.

    • by Achra (846023) on Sunday May 26, 2013 @07:02PM (#43829343) Journal
      There is something profoundly broken about our justice system in that the general public takes joy in imagining the likelihood of prison rape.
      • by Intrepid imaginaut (1970940) on Sunday May 26, 2013 @07:12PM (#43829401)

        It's not the justice system (alone) that's broken, it's the general public.

        • by shentino (1139071)

          They both are.

          Not only is prison rape wrong even though the victim is a prisoner, but why the hell should the guy doing the raping get free buttsex?

        • by ikhider (2837593)
          Yep, the general public is quite broken. They cannot even control their own government.
        • And that took quite a lot of effort, from what I can tell.

          Think about it: in order for the public to be the way it is, that is, broken with regards to how it treats its fellow human beings, some sort of self-sustaining design with negative feedback cycles has to be developed. This is, of course, assuming that human beings are, on the majority, naturally empathic beings, who do not wish each other harm...perhaps with the odd exception. Now, is it this way because of some natural evolution, or because it's si

      • by kermidge (2221646)

        I would say there is something profoundly broken with the general public as well, not mention a few of us here, given that the second titled post leapt to partisan politics via a non sequitur, and the rest weren't much better, each in their own way, although there was at least a valid grammar nazi post. Yay for us.

      • by westlake (615356)

        There is something profoundly broken about our justice system in that the general public takes joy in imagining the likelihood of prison rape.

        A casual visitor to Slashdot might be excused for thinking that it was the geek --- and not the general public --- who was obsessed with talk of prison rape and never more so then when one of his own is coming up for sentencing on a felony charge,

        • by AK Marc (707885)
          It was a popular line from a "geek" movie, so it does get more casual play in the geek circles, but it's still a popular opinion. Nobody agrees on what prison is. Is it punishment, deterrent, revenge/vengeance, isolation, or rehabilitation? Often those are mutually exclusive. Or drawn on racial lines, Blacks get the vengeance treatment, and whites get rehab/isolation.
  • by Anonymous Coward

    When I read that part the first thing that popped into my head was, "the entire arrest could be bogus".

    It's weird, when the U.S. is behind something like this then that increases the chances of the whole thing being bogus.

    • Like the illegal raids on Kim Dotcom?

    • by Darkness404 (1287218) on Sunday May 26, 2013 @10:57PM (#43830195)
      Any time you see money laundering and digital currencies you should think that the entire thing should be bogus.

      The US government thinks that it needs to be able to spy on anyone's account, for any reason, at any time and if you don't agree to violate your customer's privacy you're aiding *insert scare-word of the day*.

      I'm imagining that the US government is scared at its increasing financial irrelevance in the digital world. The US Dollar, currently the backbone of most financial transactions is in jeopardy. Digital, open currencies such as Bitcoin provide a transparent look at monetary policy and potentially can have more stability when compared to the US dollar which has the monetary policy of "whatever the hell Bernake thinks is best" and hard money like gold and silver make very good stores of wealth that cannot be devalued by printing.

      Now, the total collapse of the US dollar is likely to be delayed because out of the major currencies (USD, Yen, Euro, Sterling) the USD looks to be the one in least jeopardy, but fiat currencies have a 100% rate of failure and its likely that the multitude of better currencies will hasten the end of the USD.
  • N/T (Score:4, Insightful)

    by Anonymous Coward on Sunday May 26, 2013 @07:10PM (#43829393)

    wtf is libertyreserve? how about a proper sumamary?

    • by gl4ss (559668)

      wtf is libertyreserve? how about a proper sumamary?

      I guessed it's some bitcoin exchange. that probably wasn't sending transactions direct to DOJ.

      • Re:N/T (Score:5, Informative)

        by gl4ss (559668) on Sunday May 26, 2013 @07:47PM (#43829517) Homepage Journal

        wtf is libertyreserve? how about a proper sumamary?

        I guessed it's some bitcoin exchange. that probably wasn't sending transactions direct to DOJ.

        I was wrong, it seems it was an egold clone. a money sending service. pretty much by definition running one is going afoul of US laws regardless of you having anything to do with USA..

        • Re: (Score:3, Funny)

          by Anonymous Coward

          Unless you're HSBC, of course. Then it's all cool.

      • by murdocj (543661)

        Cue the ominous sound of black helicopters.

        "gl4ss... gl4ss...????"

  • HSBC (Score:5, Interesting)

    by Anonymous Coward on Sunday May 26, 2013 @07:13PM (#43829407)

    He should use the HSBC defense.

    Or does that only apply if you money-launder billions of drug money?

    • Re:HSBC (Score:5, Insightful)

      by GameboyRMH (1153867) <gameboyrmh&gmail,com> on Sunday May 26, 2013 @07:39PM (#43829487) Journal

      Only applies if you're Too Big To Fail.

      • by Anonymous Coward

        Only applies if you're ...

        "... too big to jail" were the exact words used.

        It is still the USA saying that one corrupt, violent government can use international finance and a less corrupt, violent government can't. I note that no-one has made that complaint on Slashdot.

        When no-one goes to jail and the corporation gets 20% commission, another 'too big to jail' operator will take the money. It's just like the drug trade. Although the US knows the racket now, the new 'Mr Big' can make lots of money if it doesn't get greedy. That's

  • Trading virtual goods could put you in jail now, no matter in which country you are at now. And that includes virtual towels too.
  • by Anonymous Coward
    I see this word "shuttered" more and more. I thought it meant physically shutter the windows, either pulling the blinds shut, or nailing over the windows like in cartoons. When did it start being metaphorical? We already have a word that means "closed": CLOSED.
    • by siride (974284)

      How is closed any better? It's just another metaphor.

    • by Anonymous Coward
      It's been that way since 1800 or so, at least. Just because you can't be bothered to use a dictionary doesn't mean others should only use one meaning of words to keep things simple for you.
    • by rsmith-mac (639075) on Sunday May 26, 2013 @09:27PM (#43829865)

      Shuttered and closed have different implications in this case. Closed implies an orderly wind down, while shuttered implies a rapid and disorderly cessation. It's akin the difference between closing time at night a local restaurant, and the owners throwing everyone out in the middle of the day.

    • by AK Marc (707885)
      I went to the local market last night, and it was closed.

      Now, tell me if it was out of business or I got there later than they were open for the day.

      What if I said:
      I went to the local market last night, and it was shuttered.
  • If you don't engage in trade and development on the terms of the United States of Terrorism, they will have you extradited.
  • by Anonymous Coward

    The next big thing is the Euro zone SEPA transfers. These replace all internal European transfers by Feb 2014, so there will be one big central database of all the money sent between anyone.

    Want to know how much rent Bob pays? It's right there in the database. How much money was donated to Jeffs political campaign? Who what when and how much is listed in that big database ready to be mined by anyone with a political mind to do so. Every money transaction listed in a nice juicy database waiting to be data mi

  • There seems to be a vocal crowd obsessed with bitcoin, but there are many other digital currencies out of there. Anyone has a decent list? Wikipedia only list a few [wikipedia.org], and LibertyReserve is not among them. It is not listed as digital money exchanger [wikipedia.org] either.
    • Re: (Score:2, Informative)

      Most of the other digital currencies are scams and frauds. Most of them are created for the express purpose of making the creator rich. Besides, Wikipedia lists heaps, just not at the article you linked to. See https://en.wikipedia.org/wiki/List_of_digital_currencies [wikipedia.org].

      Oh, and Bitcoin. Don't use LibertyReserve or another centralized system, use Bitcoin!

    • It was the same thing with the property bubble. Those invested in the pyramid scheme were always the most vocal, trying to keep prices propped up. Watch this post get modded down now as they try to protect their 'investment'.

  • It seems like the US is trying to do everything in its power to stop people from exiting the USD.

    The question is, what isn't the government telling the public? According to their official numbers, inflation is minimal, the currency is stable and the Fed's policies are helping the economy. On the other hand, their actions and the results are completely different.
    • by stenvar (2789879)

      What does money laundering have to do with "exiting the USD"? Anybody can convert USD to anything they like anytime they like.

      • ...Which is what Liberty Reserve was trying to do, let you turn USD to a digital currency.

        The US's "money laundering" regulations either make you have to refuse US customers (which is what most foreign banks do) or invade the privacy of your customers. There is no way to respect the privacy of your customers and take US customers. Its not about money laundering, its about control.

        Preventing money laundering does not mean you have to go to the extremes that the US government requires. The only reason
        • by stenvar (2789879)

          The only reason you'd need all the information that the US government requires is if you were trying to prevent people from exiting the USD. Its about control, not crime.

          Those are annoying to regular users of USD, but if you just want to exit the USD, they do not "prevent" you from doing so: you exchange your USD once, fill out the paperwork, and never have to deal with USD or US banking regulations again.

          If you find a currency and country that's actually better, let me know. So far, holding money in USD st

  • by citizenr (871508) on Sunday May 26, 2013 @11:03PM (#43830215) Homepage

    Remember that time when biggest Wall Street and City of London banks were found guilty of laundering drug money? They all went to prison!

    And by prison I mean got bonuses.

    • by lbbros (900904)
      Only after being "saved" with government money because they were "too big to fail". A nice move that swept away responsiblity.
  • This is 100% because of bitcoins. It's probably realistically 50% because of money laundering and 50% because feds in multiple countries want bitcoin to go away. Unfortunately LR and Dwolla were the two major ways to fund bitcoin exchanges without using EFTs. I think the other major way is Bit Instant and I'm not completely sure how they work exactly. I know they're super protected and designed with anonymity and anti-shutdown designs from the get go.
    • by Anonymous Coward

      Bitfloor was another way, but BofA shut down their account without warning. Guess they didn't like the competition. Same thing happened to a similar bitcoin service in Canada.

  • by SIGBUS (8236) on Monday May 27, 2013 @08:42AM (#43831923) Homepage

    For all the talk about "ZOMG the US government/New World Order/Illuminati is going to take our moneez!" in this thread, I'm surprised there's been absolutely no mention of what Liberty Reserve was often used for: the crimeware trade.

    Head over to Krebs on Security [krebsonsecurity.com] for a better idea of why shutting down Liberty Reserve is a Good Thing.

  • Because nobody expects the Spanish Inquisition!

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