On Friday (17 August 2018), the U.S. Attorney’s Office, Southern District of California, announced via a press release that Jacob Burrell-Campos, a 21-year-old Bitcoin dealer, was "ordered held without bail today in connection with a 31-count indictment charging him with operating an illegal money transmitting business, failing to maintain an anti-money laundering program, international money laundering and conspiracy to structure monetary transactions." He was arrested on 13 August 2018 when he tried to re-enter Unites States from Mexico.
Jacob's Facebook page says he is a resident of San Diego (t seems that he was born there, but according to the court, he lives in Rosarito, a coastal resort city in the Mexican state of Baja California). It also says that he works as a programmer for a startup called "Edge" (their mobile crypto wallet lets you buy/sell/store several cryptocurrencies).
According to the press release:
- Jacob is a Bitcoin dealer who has sold $750,000 worth of bitcoin (across 971 transactions) to over 900 U.S. customers.
- He accepted payments in person (cash), via his bank accounts, and through MoneyGram.
- Assistant U.S. Attorney Robert Ciaffa told the court that Jacob worked as a Bitcoin "exchanger", and that his business operations could be considered a "money transmitting business", for which one is required to register with the Treasury Department and comply with all AML requirements (such as reporting large cash transactions).
- Jacob, however, took cash payments for Bitcoin purchases "with no questions asked", and charged a 5% fee for his services.
- He is also charged with multiple counts of international money laundering. The indictment says 28 wire transfers (for a total of over $900,000) were sent from his U.S. bank accounts to a Taiwanese bank account in the name of "Bitfinex." AUSA Ciaffa says that these funds were sent to cover his purchases of bitcoin.
- In total, he seems to have bought over $3 million worth of bitcoin (across more than 2,600 transactions) for his business, some of them apparently through Coinbase (which closed his account because he did not comply with their ID verification requirement).
The court found that Jacob had close ties to Mexico, three citizenships, and no steady job in the U.S. Therefore, he was considered a flight risk, and denied bail.