[HN Gopher] Defense Motion: Bitcoin is not "money" within the me...
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Defense Motion: Bitcoin is not "money" within the meaning of 18
U.S..C. SS 1960 [pdf]
Author : quickthrower2
Score : 40 points
Date : 2021-07-16 17:44 UTC (5 hours ago)
(HTM) web link (storage.courtlistener.com)
(TXT) w3m dump (storage.courtlistener.com)
| itomato wrote:
| Don't bother - hawala.com is taken
| X6S1x6Okd1st wrote:
| Seems like an argument worth having. Somehow it doesn't seem like
| the court will decide that bitcoin isn't money, but hopefully
| will at least give clarity to whether bitcoin is money.
| davidgerard wrote:
| This is dumb as hell. The FinCEN rules talk about this as "value
| that substitutes for currency", which this is absolutely doing.
| If you use phone cards as a money substitute, it's money
| transmission. If you use bottles of Tide detergent as a money
| substitute, it's money transmission.
| the_sleaze9 wrote:
| Interesting. Charging someone for a crime which _could_ have been
| committed....
| smachiz wrote:
| Attempted Murder is a crime - so is attempted bribery and
| extortion.
|
| I'm not sure what your point is.
| rantwasp wrote:
| the point is that this shit is turning into Minority Report.
|
| It's one thing to accuse someone of attempted murder when
| they actually tried killing someone, it's another thing to
| accuse someone of attempted murder for suspecting them about
| thinking about killing someone.
| quickthrower2 wrote:
| It's a sting operation
| vkou wrote:
| Unfortunately for your argument, the defendant did not
| think about laundering drug money, they _did_ actually
| launder what they believed was drug money.
|
| Thinking isn't a crime. Doing is.
| JumpCrisscross wrote:
| > _Charging someone for a crime which _could_ have been
| committed_
|
| Weren't they operating a money transmitting business without
| being properly licensed before the FBI got involved?
| ur-whale wrote:
| Your tax money at work: govt attacking citizens who didn't hurt a
| fly.
| danuker wrote:
| Trading with someone openly admitting to sell dangerous drugs?
| Not hurting anyone is incidental.
|
| > The Government sent an undercover officer to visit The Geek
| Group and purchase bitcoin and, while doing so, mention that he
| sold cocaine.
| ur-whale wrote:
| > mention that he sold cocaine
|
| which was a bald-faced lie.
|
| entrapment is a thing.
| carl_dr wrote:
| Saying he got the money from selling cocaine is almost the
| opposite to entrapment. It certainly didn't lead them to
| selling him Bitcoin when they would not have otherwise - he
| didn't induce them to commit a crime.
|
| What he did was show they were happy to deal with a
| supposed criminal, even knowing the money had come from his
| crimes.
| olalonde wrote:
| I don't understand. Didn't the FBI agent induce him to
| commit money laundering by telling him he sold cocaine?
| Also, can't the defendant claim they thought it was a
| joke? Depending on the context, I most likely would have
| assumed it was a joke. It seems like the kind of answer
| someone would jokingly give if they didn't want to
| discuss their real job.
| [deleted]
| luma wrote:
| That was a interesting issue as the defendant has always
| been extremely vocal about being anti-drug in person and
| through his social media channels. I'm frankly a little
| surprised that he went through with that particular
| transaction, while I hold a fairly low opinion of the guy
| he at least seemed to be consistent in his principles.
|
| I guess money was the goal and he was willing to
| compromise himself in its pursuit.
| bawolff wrote:
| Entrapment is a thing, its just not this thing. That word
| means something else.
| cstejerean wrote:
| Entrapment is a thing but it's not this thing. Entrapment
| is making someone do something they wouldn't have done
| otherwise.
| jMyles wrote:
| It seems like you're outwardly defending drug prohibition
| here.
|
| Trading with someone who previously sold plants or compounds
| to a third party is not per se a moral or ethical quandary,
| despite apparent laws to the contrary.
|
| If that were the worst thing this person did, I suspect he'd
| have far more support.
|
| I am skeptical of the other whispers of unsavory behavior;
| they remind me of the whisper smears against Ross Ulbricht.
| Let's see how the thing develops.
| jfengel wrote:
| The "bitcoin is not money" argument seems unlikely to work. There
| are people selling things for bitcoin. Not universally, but
| enough places that I don't see a court accepting the argument
| that it doesn't act like money.
|
| The "selling bitcoin is not transmitting money" seems more likely
| to me, at least as long as the sums are small. If they're selling
| more than $10k worth of bitcoin then it sounds like they're
| engaging in banking, if not money transmitting.
|
| But if they're selling a lot of bitcoins, they know perfectly
| well that it's a mechanism for moving money around. The fact that
| they don't know the destination doesn't make it not money
| laundering. If people are bringing large sums of money to some
| dipsticks rather than buying it on the open market, they're
| almost certainly trying to avoid visibility.
| bawolff wrote:
| I think bitcoin is money, but "There are people selling things
| for bitcoin" is a silly argument. People barter all the time
| with non-money things.
| [deleted]
| psychlops wrote:
| I don't think it's a bad argument. The UCC defines money as
| something that has a government attached to it. If people
| treated leaves like money for simulated drug sales, it
| shouldn't get them jail time.
|
| "Money" means a medium of exchange currently authorized or
| adopted by a domestic or foreign government. The term includes
| a monetary unit of account established by an intergovernmental
| organization or by agreement between two or more countries.
|
| https://www.law.cornell.edu/ucc/1/1-201
| [deleted]
| luma wrote:
| I have no idea if you're right, but the defendant appears to
| think you are wrong and that Bitcoin is in fact money, and he
| publically said as much back in 2017:
| https://i.imgur.com/7gP31ks.png
|
| This motion to dismiss is going to be pretty hard for him to
| defend.
| jbverschoor wrote:
| It nowhere says that it's money
| bawolff wrote:
| The defendants personal opinions dont really seem relavent
| to the question of if its money in the eyes of the court.
| skeeter2020 wrote:
| This defense seems doomed as money != a specific government-
| issued currency. IANAL but I suspect this is determined by an
| instrument serving enough of the underlying functions of
| currencies, which BC most certainly does.
|
| Also, effective money laundering OFTEN involves the
| facilitators NOT knowing the nodes in the graph; that's what
| makes it effective in the first place.
| Turing_Machine wrote:
| > This defense seems doomed as money != a specific
| government-issued currency.
|
| According to the statute in question (and also the Uniform
| Commercial Code), it is.
|
| The statute reads, in part, "Money," in its
| common use, is some kind of financial instrument or medium of
| exchange that is assessed value, made uniform, regulated, and
| protected by sovereign power."
|
| Also: ... the Uniform Commercial Code
| defines money as "a medium of exchange *currently authorized
| or adopted by a domestic or foreign government..."
|
| I think they have a good argument. While Bitcoin is certainly
| "money-like", it does not appear to fit the U.S. government's
| current definition of "money".
| SomewhatLikely wrote:
| FWIW El Salvador now accepts Bitcoin as legal tender.
| fennecfoxen wrote:
| Supposedly. The rollout is a clown show.
|
| https://davidgerard.co.uk/blockchain/2021/07/11/el-
| salvador-...
| OldHand2018 wrote:
| If "bitcoin is not money" then you are opening a can of worms
| that nobody wants opened. Especially if you treat it like
| personal property as the linked document prefers. Wash sale
| rules probably start to apply. You're going to need to charge
| sales tax and get a business license from your local city just
| to trade on Coinbase, etc. No thanks.
|
| Each dollar bill or Euro or Yuan, etc, has a serial number.
| That means you can lay claim to an exact bill, just like with
| Bitcoin. But we call money fungible because we don't actually
| care which dollar bill it is we are holding. They are all the
| same from a value standpoint.
| DennisP wrote:
| The IRS already treats bitcoin as personal property.
| humanistbot wrote:
| They bought a lot of bitcoin early, then made a profit off
| regularly selling it to the public in exchange for US dollars.
| They didn't register with FinCEN, any state agency, or do any
| KYC. The thing about the sting operation is that the undercover
| agent blatantly told them that he was buying bitcoin using money
| he made from selling cocaine. So it isn't just a charge for
| operating an unlicensed money exchange service, but also
| laundering drug money.
| rantwasp wrote:
| hmm. so if we swap out bitcoin with lumber. and I accumulate a
| lot of lumber and after that sell it do I need to register with
| FinCEN? or do lumber KYC?
|
| this is part of the FUD campaign against Bitcoin. If they
| committed other crimes, etc, sure charge them if you have
| proof. If not this is literally a waste of taxpayers money.
| quickthrower2 wrote:
| It is going to depend inagine. Very expensive and easy to
| transport lumber, purchased for cash with the same people
| buying a million a week. Maybe should raise some flags.
| bb88 wrote:
| Money laundering is all about turning money from illegal
| operations into money that looks like it came from legal
| sources.
|
| Yes you can buy lumber (e.g.) but for it be really useful,
| you're going to need to convert that back to cash, and the
| only real way to store large amounts of money safely is in
| the banking system. Some people may speak bitcoin, but
| everyone speaks US greenbacks.
|
| KYC is about companies depositing large sums of money from
| questionable sources. You start depositing 10M a week without
| any reported business income, and you're going to set off red
| flags.
| AnimalMuppet wrote:
| If it's being used to launder drug money, I'm pretty sure "but
| it's not money" isn't going to fly in court. Can you launder
| drug money using gold bars, and you're good because gold bars
| aren't "money"? I'm pretty sure you can't. It may fall under a
| slightly different part of the statute, but that kind of
| loophole has almost certainly already been plugged.
| wsc981 wrote:
| Real estate is often used to launder illegally gained
| money[0], so likely drug money as well.
|
| _> Real estate has long been a preferred vehicle for money
| laundering. All too often, the proceeds of crime and
| corruption is used to purchase homes. Once the real estate is
| re-sold, the capital involved becomes legally acquired. The
| trick is to mask where the money comes from: Criminal
| networks do this by setting up anonymous companies to hide
| their connection to the purchase of the property. This
| briefing reveals the scope and seriousness of this problem
| and makes recommendations for what must be done to fix it._
|
| ---
|
| [0]: https://www.globalwitness.org/en/campaigns/corruption-
| and-mo...
| arcticbull wrote:
| Which is why we have AML/KYC at most steps of a real-estate
| transaction. Further, saying you can do crime with
| something else so let's look the other way is nihilist and
| pretty backwards to me. In that case let's go after both.
| ipsin wrote:
| This reminds me of the story of the man who put hidden
| compartments in cars [1], or the man who trained people to beat
| polygraph tests [2].
|
| Whenever someone tells you about All the Crime They Are Doing,
| I think you should assume that you are dealing with an actual
| cop, stop doing business with them, and cut off all contact.
|
| [1] https://www.wired.com/2013/03/alfred-anaya/ [2]
| https://www.washingtonpost.com/local/indiana-man-accused-of-...
| luma wrote:
| The defendant is pretty well known around these parts and the
| initial arrest wasn't terribly surprising to those who had run-
| ins with him.
|
| Here's a particularly egregious example:
| https://old.reddit.com/r/grandrapids/comments/lvqr6k/geek_gr...
| quickthrower2 wrote:
| Is what was said there classed as racketeering / organised
| crime?
| rantwasp wrote:
| slept with all the female board members. jfc. this looks
| really really bad, even without context
| renewiltord wrote:
| Damn, the Reddit commenter is very casual about being non-
| consensually filmed while showering. That's a harrowing tale
| all through if it's true. I totally get why they decided to
| keep quiet, though.
| Simulacra wrote:
| That just seems like entrapment... Bitcoin to me has always
| been an intangible asset. If someone is willing to exchange
| cash for it then that does not mean Bitcoin is suddenly cash. I
| wonder what the government's argument would be if bitcoin were
| tangible, say bottle caps.
| JumpCrisscross wrote:
| > _wonder what the government 's argument would be if bitcoin
| were tangible, say bottle caps_
|
| Imagine someone tells you "I am a drug dealer, I have bottle
| caps I got for selling drugs and would like to launder them
| through you. Could you help me?"
|
| And you respond "Sure."
|
| And she comes back saying "it's me again, the drug dealer.
| Here are my bottle caps. That I got for selling drugs. I need
| to launder them. Because I got them from selling drugs.
| Because I'm a drug dealer." [1]. And you give them money for
| their bottle caps.
|
| What do you think will happen? Do you think "but your honor,
| bottle caps aren't money" will help?
|
| [1] _Inspired by_ https://www.bloomberg.com/news/newsletters/
| 2021-06-21/money-...
| arcticbull wrote:
| I mean the whitepaper is titled a peer-to-peer electronic
| cash system.
|
| [edit] It feels like Scrodinger's asset class. It's a
| commodity when it's being attacked for being a security. It's
| a currency when it's attacked for being a commodity. At the
| end of the day I don't care, if it's good at being laundered
| then you can call it whatever you want, AML/KYC is going to
| have to apply.
|
| [edit] Further, entrapment is a specific legal construct
| wherein the government tricks you into committing a crime. If
| the government comes up and says "hello, do you want to do a
| crime?" and you say "damn right I do" that's not entrapment,
| that's just crime.
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