Damian Williams, the U.S. Attorney for the Southern District of New York; Thomas Fattorusso, the Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (IRS-CI); and James Smith, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (FBI), disclosed today the unveiling of an Indictment accusing KEONNE RODRIGUEZ, the Chief Executive Officer and co-founder of Samourai Wallet (Samourai), and WILLIAM LONERGAN HILL, the Chief Technology Officer and another co-founder of Samourai, with conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. These charges stem from the defendants’ creation, promotion, and management of a cryptocurrency mixer that processed over \(2 billion in illicit transactions and facilitated more than \)100 million in money laundering activities from unlawful dark web markets like Silk Road and Hydra Market. The offenses also involve a web-server breach, a spearphishing ploy, and deceptions targeting various decentralized finance protocols. RODRIGUEZ was apprehended this morning and is anticipated to appear before a U.S. Magistrate Judge in the Western District of Pennsylvania today or tomorrow. HILL was also arrested this morning in Portugal based on the U.S. criminal charges. The United States intends to request HILL’s extradition for trial within the country. The case has been assigned to U.S. District Judge Richard M. Berman.
In collaboration with law enforcement authorities in Iceland, Samourai’s web servers and domain (https://samourai.io/) were confiscated. Furthermore, a seizure warrant was executed for Samourai’s mobile application on the Google Play Store. Consequently, the application will no longer be accessible for download from the Google Play Store in the United States.
U.S. Attorney Damian Williams remarked, “As alleged, Keonne Rodriguez and William Lonergan Hill are responsible for developing, marketing, and operating Samourai, a cryptocurrency mixing service that executed over \(2 billion in unlawful transactions and served as a haven for criminals to engage in large-scale money laundering. Rodriguez and Hill allegedly knowingly facilitated the laundering of over \)100 million of criminal proceeds from the Silk Road, Hydra Market, and a host of other computer hacking and fraud campaigns. Together with our law enforcement partners, we will continue to relentlessly pursue and dismantle criminal organizations that use cryptocurrency to hide illicit conduct.”
Special Agent in Charge Thomas Fattorusso of IRS-CI stated, “\(2 billion in transactions with an unlicensed money transmitter means \)2 billion flowed without any oversight, from whomever to wherever. Because of the company’s disregard for regulation, it’s alleged that Samourai Wallet laundered more than $100 million in criminal proceeds. Special Agents with IRS:CI New York and IRS:CI LA’s Cyber units collaborated with our federal and international law enforcement partners to not only apprehend the founders and CEO but also to seize their domain. Samourai Wallet is now closed for business.”
James Smith, the FBI Assistant Director in Charge, mentioned, “Threat actors utilize technology to evade law enforcement detection and create environments conducive to criminal activity. For almost 10 years, Keonne Rodriguez and William Hill allegedly operated a mobile cryptocurrency mixing platform which provided other criminals a virtual haven for the clandestine exchange of illicit funds, the facilitation of more than \(2 billion in illegal transactions, and \)100 million in dark web money laundering. The FBI is committed to exposing covert financial schemes and ensuring no one can hide behind a screen to perpetuate financial wrongdoing.”
According to the allegations in the Indictment unveiled today in Manhattan federal Court:
Background on Samourai
Between approximately 2015 and February 2024, RODRIGUEZ and HILL developed, marketed, and managed a cryptocurrency mixing service known as Samourai, an unlicensed money transmitting business that generated millions of dollars in fees for them. Samourai illicitly combined multiple distinctive features to conduct anonymous financial transactions exceeding \(2 billion for its clientele. While positioning Samourai as a "privacy" service, the defendants were aware that it served as a hub for criminals to conduct large-scale money laundering and evade sanctions. A significant portion of the funds processed by Samourai, as intended by the defendants, were proceeds of criminal activities funneled through Samourai for the purpose of concealing their origins. During this period, Samourai laundered over \)100 million of illicit proceeds originating from various criminal sources, including illegal dark web markets like Silk Road and Hydra Market, wire fraud and computer fraud schemes, web-server intrusions, spearphishing schemes, and fraud schemes targeting multiple decentralized finance protocols, among other illegal activities.
RODRIGUEZ and HILL initiated the development of Samourai around 2015. Samourai is a mobile application that users can install on their smartphones, with over 100,000 downloads to date. Upon installation, users can store their private keys for any BTC addresses they control within the Samourai program. Although Samourai employees do not have access to these private keys, Samourai operates a centralized server that oversees and facilitates transactions between Samourai users, creating new BTC addresses used during transactions. Samourai is utilized by customers globally, including those in the United States and the Southern District of New York.
Samourai was designed by RODRIGUEZ and HILL to provide at least two features aimed at aiding individuals engaged in criminal activities to obfuscate the origins of their illicit proceeds. Firstly, Samourai offers a cryptocurrency mixing service named “Whirlpool,” which coordinates batches of cryptocurrency exchanges among groups of Samourai users to prevent law enforcement from tracing criminal proceeds on the Blockchain. Secondly, Samourai provides a service called “Ricochet,” enabling a user to include additional and unnecessary intermediate transactions (known as “hops”) when transferring cryptocurrency from one address to another. This feature similarly hinders law enforcement and cryptocurrency exchanges from identifying a specific batch of cryptocurrency as stemming from criminal sources. Since the inception of the Whirlpool service around 2019 and the Ricochet service around 2017, over 80,000 BTC (equivalent to over \(2 billion based on BTC-USD conversion rates at each transaction) has flowed through these two services operated by Samourai. Samourai charges a fee for both services, estimated at approximately \)3.4 million for Whirlpool transactions and $1.1 million for Ricochet transactions over the same period.
RODRIGUEZ and HILL maintained Twitter accounts that encouraged and openly welcomed users to launder criminal proceeds through Samourai. For instance, in June 2022, Samourai’s Twitter account — managed by RODRIGUEZ — posted a message regarding Russian oligarchs seeking to evade sanctions:
Similarly, in a private message around August 27, 2020, HILL — using a Twitter account with the handle “Samourai Dev” — conversed with another Twitter user about criminals utilizing Samourai in online black markets like Silk Road:
Twitter User: Silk Road is why I first found Bitcoin and the desire to keep engaging in those types of markets is one reason that I want to defend/strengthen those use cases …
Samourai Dev: No, not at all. We probably have different views on some basic tenets of bitcoin, you and I – so to each his own so to speak. At Samourai we are entirely focused on the censorship resistance and black/grey circular economy. This implies no foreseeable mass adoption, although black/grey markets have already started to expand during covid and will continue to do so post-covid… .
Additionally, in response to Europol flagging Samourai as a “top threat” to law enforcement’s ability to trace criminal proceeds, HILL posted a message around March 2021 indicating that Samourai would not alter its practices despite allegations of money laundering:
RODRIGUEZ and HILL also possessed and shared with potential investors marketing materials discussing how Samourai’s customer base was expected to include criminals seeking privacy or bypassing safeguards and reporting requirements imposed by financial institutions. In Samourai’s marketing materials, RODRIGUEZ and HILL acknowledged that individuals most likely to use a service like Samourai are those involved in criminal activities, including participants in “Restricted Markets.”
In a segment from Samourai’s marketing materials, RODRIGUEZ and HILL recognized that their revenues would come from “Dark/Grey Market participants” seeking to “swap their bitcoins with multiple parties” to avoid detection:
In their marketing materials, RODRIGUEZ and HILL promoted Samourai’s Wallet and its Mixing Service as a “Premium Privacy Service” for transactions involving proceeds from goods and services that include “Illicit Activity.”
RODRIGUEZ, aged 35, from Harmony, Pennsylvania, and HILL, aged 65, a U.S. national arrested in Portugal, each face one count of conspiracy to commit money laundering, carrying a maximum sentence of 20 years in prison, and one count of conspiracy to operate an unlicensed money transmitting business, carrying a maximum sentence of five years in prison.
The maximum sentences are set by Congress and are provided for informational purposes only, as any sentencing will be determined by the judge.
Mr. Williams commended the investigative efforts of IRS-CI and the FBI, acknowledging the support of the Justice Department’s Office of International Affairs. He also expressed gratitude to Europol, the Portugal Judiciary Police, the Icelandic Police, the FBI Field Office in Pittsburgh, the FBI’s International Operations Division, and the IRS-CI Los Angeles Field Office for their collaboration in the investigation.
This case is overseen by the Office’s Complex Frauds and Cybercrime Unit and Illicit Finance and Money Laundering Unit. Assistant U.S. Attorneys Andrew K. Chan and David R. Felton are leading the prosecution.
The allegations in the Indictment are accusations, and the defendants are presumed innocent unless proven guilty.
As indicated by the introductory phrase, the content of the Indictment and the description provided herein should be treated as allegations, with each fact described considered as such.