William Lonergan Hill, the co-founder of Samourai Wallet, has been granted bail after he was arrested by the federal authorities of the United States of America for money laundering and running an unlicensed money transfer service. Hill, who is also known by the alias TDev, was arrested along with co-founder Keonne Rodriguez in April.
Hill’s bail conditions have not been set yet, but he has been offered a rather generous bail package of around $3m. If the court were to allow Hill to bring his wife back to Portugal with him, the bail amount would then be around $4.4 million.
Samourai Wallet’s Co-founder Defense and Prosecutors’ Stance
Hill’s defense counsel is seeking his release to Portugal, where he currently lives with his wife. Nevertheless, the U.S. Department of Justice prosecutors have opposed the request and suggested that Hill should stay at his sister’s Brooklyn basement during the bail period.
吴说获悉，据 Bitcoin News，美国政府已同意保释 Samourai Wallet 开发者 William Lonergan Hill（又名 TDev），Hill 将于下周在纽约市法院出庭，其已从葡萄牙引渡回国。此前 4 月底，Samourai Wallet 联创 Keonne Rodriguez…
— 吴说区块链 (@wublockchain12) July 6, 2024
The defense letter from Hill also shows that all the assets used as collateral are from his family, meaning that they are putting their wealth on the line to ensure his adherence to the bail conditions. The defense is ready to dispute the charges and explain that the trial may not start until the end of 2025 due to a long preliminary phase.
At the same time, the team is compiling a detailed defense in order to fight the charges against Hill. A critical point made is that Samourai Wallet was listed on the Google App Store starting from 2015 up to April 2024. Therefore, if the wallet was indeed designed for money laundering purposes, then one could argue that Google could be deemed to be an unindicted co-conspirator.
Also, the defense stated that Samourai Wallet did not fall under the definition of a money-transmitting business provided by FinCEN at the time and thus had no legal responsibility to fight money laundering under the Bank Secrecy Act.
Senators’ Support and Broader Implications
Earlier this year, Senators Cynthia Lummis and Ron Wyden wrote a letter to Attorney General Merrick Garland on behalf of Hill. The letter accused the Department of Justice of misinterpreting FinCEN’s rules, saying that the DoJ’s actions could lead to criminalizing software developers for their code.
The senators also argued that labeling manufacturers of non-custodial crypto software as unlicensed money transmitters would harm innovation and affect the DOJ’s recognition of the current legal analysis.
Rodriguez’s Case and Related Legal Developments
Hill’s co-founder, Keonne Rodriguez, has also been charged with similar crimes and has entered a not-guilty plea. He was released on a $1 million bond in April. His case is just one of the many linked to a crackdown on crypto mixers by the U.S. authorities, who allege that these services help to launder money by making it difficult to trace the source of the funds.
BREAKING: Samourai Wallet Founders And CEO Keonne Rodriguez and William Lonergan Hill Have Been Arrested and Charged With Money Laundering And Unlicensed Money Transmitting Offenses.
— Justin ₿echler (@1914ad) April 24, 2024
The Samourai Wallet website has been seized. pic.twitter.com/ZLUvQhuFpB
According to the Department of Justice, Samourai Wallet received more than $2 billion in funds associated with criminal activities and more than $100 million in funds from the dark web marketplaces.
Other developers have also been affected by the crackdown on crypto mixers, including Roman Storm of Tornado Cash, who has been charged with money laundering and sanctions violations. The DOJ is being accused by critics, including several crypto advocacy groups, of using the law in an incorrect and unchartered manner in its actions against non-custodial wallet developers.
Hill is due to appear in the U.S. District Court for the Southern District of New York on July 9 or 10. During the legal process, Hill and his defense counsel continues to fight the charges and the expanded scope of the regulatory provisions used to prosecute them.
