From 2017 to 2021, He Operated a VirtuL-Currency Money Services Business Known as Digital Coin Strategies LLC
A 33-year-old Santa Monica man, Charles James Randol, was sentenced to four months in prison for helping launder millions through a cryptocurrency exchange.
In September, Randol agreed to plead guilty to a federal charge for allowing his cryptocurrency-cash exchange company to aid scammers and drug traffickers in laundering millions of dollars in criminal proceeds.
Randol’s plea agreement involves admitting guilt to a single-count information for failure to maintain an effective anti-money laundering (AML) program. Both the information and plea agreement were filed in United States District Court in downtown Los Angeles
According to the plea agreement, from October 2017 to July 2021, Randol operated a virtual-currency money services business known as Digital Coin Strategies LLC, offering cryptocurrency-cash exchange services.
He engaged in various methods, including in-person transactions, automated kiosks in multiple counties, and Bitcoin-for-cash transactions for unknown individuals who mailed substantial amounts of U.S. currency.
Randol advertised falsely on his company website, claiming compliance with AML regulations, while, in reality, he repeatedly violated federal law and his own AML policies by facilitating suspicious currency exchange transactions and concealing them from law enforcement.
He engaged in in-person cash transactions exceeding $10,000 with anonymous individuals, violating AML policies. He exchanged $273,940 in cash for Bitcoin without proper identification, contravening regulations.
Additionally, Randol facilitated Bitcoin-for-cash transactions after receiving large cash shipments from anonymous senders via mail. He conducted these transactions without due diligence on the source of funds, often receiving suspiciously packaged cash hidden inside various items. Despite a brief hiatus due to law enforcement scrutiny, Randol resumed this activity, contributing to the laundering of fraud proceeds.
Furthermore, Randol’s deficient AML practices allowed criminals to structure and launder funds through Bitcoin kiosks he operated in various locations. He set up “test” accounts against compliance advice, enabling customers to avoid currency reporting requirements.
Randol’s failure to comply with AML requirements resulted in his business laundering funds from a New Jersey victim deceived into sending money for a fictitious legal issue. Despite hiring a compliance officer, Randol continued risky practices, leading to an investigation by the FBI, Homeland Security Investigations, Federal Deposit Insurance Corporation Office of Inspector General, and the United States Postal Inspection Service.
