DOJ Targets Crypto Exchange Accused of Silk Road Money Laundering, Operator Faces Prison Time

Silk Road Connections Resurface as DOJ Targets Crypto Tycoon in $30M Scandal

The U.S. Department of Justice (DOJ) announced on Monday that a federal grand jury in Indianapolis has indicted Maximiliano Pilipis, 53, formerly of Noblesville, Indiana, on charges related to operating Aurumxchange, an unlicensed cryptocurrency exchange.

Announcing the charges, the U.S. Attorney’s Office for the Southern District of Indiana cited five counts of money laundering and two counts of failure to file tax returns. “From approximately 2009 through 2013, Pilipis created and operated Aurumxchange to allow individuals to exchange bitcoin and other virtual currencies for U.S. dollars, and other government-issued and virtual currencies,” court documents detail, adding:

Aurumxchange and Pilipis collected fees worth millions of dollars for facilitating these transactions, including amassing over 10,000 bitcoin, worth approximately $1.2 million at the time.

Without meeting federal registration or reporting requirements, “Aurumxchange was used to conduct over 100,000 transactions, resulting in the transfer of over $30 million in funds.” Authorities claim that some funds transacted through Aurumxchange originated from Silk Road, an anonymous dark web marketplace shut down in 2013 for hosting illegal activities, including drug sales. Pilipis reportedly ceased Aurumxchange operations the same year.

Afterward, he allegedly concealed and laundered the proceeds by dividing and transferring the bitcoin, converting portions of it to U.S. dollars in 2018, which he used to purchase properties in Arcadia and Noblesville, Indiana.

The DOJ noted:

If convicted, Pilipis faces up to 10 years in federal prison and a fine of up to $250,000.