The Polish law enforcement apprehended a Russian national associated with the now-defunct WEX exchange for purported fraud and money laundering activities. Authorities in the US have requested his extradition due to his involvement in cryptocurrency-related offenses and are presently awaiting the conclusion of the extradition proceedings.
WEX’s ‘Crypto Monarch’ Arrested In Poland
On Friday, regional news outlets disclosed that Polish officials had detained a 37-year-old Russian individual in Warsaw. Due to regulations in Poland, the media referred to the accused as “Dmitry V.” but seemingly identified him as the former head of the WEX cryptocurrency exchange, Dmitry Vasiliev, who was born in Belarus.
The apprehension of Vasiliev was carried out by the “Shadow Hunters,” a specialized division of the Central Bureau of Police Investigation (CBŚP), at a residence located in the Wola district, as revealed by Krzysztof Wrześniowski, a spokesman for the CBŚP.
Wrześniowski highlighted that the detention was conducted under a warrant from the Warsaw District Prosecutor’s Office, which acted on an extradition appeal from the US Department of Justice. “Dmitry V. is accused of multiple instances of fraud, money transfers, and money laundering related to the operation of one of the largest cryptocurrency exchanges globally,” he elaborated.
It’s notable that Vasiliev was previously arrested in Poland in August 2021. The fugitive was taken into custody at Warsaw’s Chopin Airport following a request from Kazakhstan, which sought his extradition for crimes associated with cryptocurrency. Nevertheless, he was liberated after a few weeks in detention and returned to Russia.
Polish officials expressed concern regarding how Vasiliev managed to re-enter the country and evade detection for an extended period, implying he likely led a discreet lifestyle to circumvent the law.
Currently, the sought-after “crypto monarch” is facing a renewed extradition request from the US for prosecution concerning his alleged offenses. If successfully extradited, Vasiliev may confront a potential sentence of up to 20 years in prison, as stated by Wrześniowski.
The individual is in custody, awaiting the finalization of the entire procedure pertaining to his extradition to the US.
The $450 Million WEX Collapse
As various media sources have reported, Vasiliev allegedly managed World Exchange Services (WEX) until its downfall in 2018. The exchange emerged to “address the void” left by the shut-down BTC-e crypto exchange, which ceased operations due to an FBI investigation related to international money laundering and concealing stolen assets from Mt. Gox.
As noted by the BBC in 2019, despite Vasiliev being the public persona, WEX was operated “from behind the scenes” by Alexey Bilyuchenko. Bilyuchenko was a partner of Alexander Vinnik in the now-defunct BTC-e exchange.
Following the collapse of BTC-e, he financed WEX with support from billionaire Konstantin Malofeyev. The exchange collapsed the following year when $450 million of customers’ funds mysteriously disappeared. According to the BBC, Bilyuchenko asserted that he lost control of the exchange in spring 2018 after being “deceived” by fake security service operatives.
The suspect alleged he was “advised” to transfer the funds to a wallet managed by the Russian Federal Security Service (FSB) during a meeting with Malofeyev and the “agents.” He claimed that associates of Malofeyev had defrauded him.
However, the Moscow tycoon, who has “strong connections” with the Kremlin, refutes the allegations. Bilyuchenko initially escaped US apprehension for the BTC-e case but was reportedly detained by Russian authorities due to the WEX collapse in 2022. In 2023, he was charged by US officials for his involvement in the BTC-e exchange and the Mt. Gox hacking incident.
Bitcoin (BTC) is priced at $97,831 on the one-week chart. Source: BTCUSDT on TradingView
Featured Image from Unsplash.com, Chart from TradingView.com
