Samourai Wallet Dev Sentenced to 5 Years in Prison

NEW YORK — Samourai Wallet developer Keonne Rodriguez was sentenced to five years in prison on Thursday for his role in creating a bitcoin mixing service that prosecutors say was used to launder $237 million in dirty money.

District Judge Denise Cote of the Southern District of New York (SDNY), who oversaw the case, handed down the sentence after a roughly hour-long hearing at the federal courthouse in downtown Manhattan.

Rodriguez’s sentence of five years is the statutory maximum sentence for his crime. In the government’s sentencing memo submitted to the court on Oct. 31, prosecutors urged Judge Cote to impose that maximum sentence, writing that the pair intentionally and knowingly laundered “proceeds from drug trafficking, darknet marketplaces, cyber-intrusions, frauds, murder-for-hire schemes, and a child pornography website” through Samourai Wallet. In his own sentencing submission, Rodriguez’s lawyers suggested a sentence of one year and a day in prison.

Rodriguez and his fellow Samourai Wallet developer William Lonergan Hill were arrested last April and charged with conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. Though the pair fought the case for more than a year, they struck a surprise deal with prosecutors in July, agreeing to plead guilty to the lesser unlicensed money transmitting conspiracy charge in exchange for the money laundering conspiracy charge — which carries a maximum sentence of 20 years in prison — being dropped.

The pair’s change in plea came in the midst of fellow developer Roman Storm’s trial, also in the Southern District of New York. Like Rodriguez and Hill, Storm — one of the developers of Tornado Cash, a once-popular crypto privacy tool — was charged with conspiracy to operate an unlicensed money transmitting business and conspiracy to commit money laundering, with an additional charge of conspiracy to violate international sanctions. A Manhattan jury found Storm guilty only on the unlicensed money transmitting charge, failing to reach a unanimous verdict on the other two charges. Prosecutors have not yet indicated whether they plan to retry Storm on the two hung charges.

Hill is scheduled to be sentenced by the same judge on Friday at 11 am ET.