U.S. Authorities Crack Down on Crypto Network Powering Global Crimes

• The U.S. federal prosecutors, in partnership with the FBI and state police, have traced over $70 million linked to illegal proceeds through E-Note.
• Chudnovets, the mastermind behind the network, has been arrested and is currently facing money laundering conspiracy charges that could result in up to twenty years’ imprisonment as the FBI continues to identify victims and recover funds.

The American federal prosecutors, in partnership with some international security agencies and the Michigan State Police, have arrested and dismantled a scammy cryptocurrency network that was used to move criminal funds for different international hacking groups.

According to the investigators, the operation successfully helped clean tens of millions of dollars linked to ransomware extortion, hospital attacks, and breaches against essential systems across the United States.

The Architect Behind the Hidden Crypto Network and How It Operated

Based on the report shared by the Department of Justice, Mykhalio Petrovich Chudnovets, a 39-year-old Russian citizen, was one of the leaders in control of running their “disguised cryptocurrency platform.” He spent more than a decade offering underground financial services to cyber offenders.

According to the prosecutors, he ran E-Note as a private payment channel that helped criminals move digital assets across borders and also quietly exchange them into their local currencies. By doing this, the criminal’s funds were not easily traceable, and his profits flowed through mule networks and encrypted systems.

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The authorities also shared that Chudnovets controlled all the major parts of the network from transaction routing to all the backend infrastructure; this way, he gave the cyber gangs a reliable pathway to turn stolen or extorted crypto into spendable money. Over seventy million dollars in illegal proceeds were traced to the platform, with most of the funds tied to account takeovers and ransomware campaigns targeting American victims.

Source: Justice.gov

So far, Chudnovets has been accused of conspiring to launder ‘monetary instruments’ and has the potential of facing a charge that carries a sentence of up to twenty years in federal custody. The FBI’s Detroit Cyber Task Force continues to lead the investigation on the case and has urged anyone who believes their crypto and money passed through the E-Note system to contact federal authorities, as their work towards identifying and assisting victims remains ongoing.

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