The former chief technology officer of Liberty Reserve has been sentenced to five years in prison for conspiring to operate an unlicensed money transmitting business - billed as the bank of choice for the cyber underground - that processed more than $16 billion in digital currency transactions.
Mark Marmilev, 35, of Brooklyn, New York, pleaded guilty to the charges in September in connection with his role in designing and maintaining the technological infrastructure for Liberty Reserve.
Before being shut down by the US government in May 2013, Liberty Reserve had more than five million user accounts worldwide, including more than 600,000 accounts associated with users in the United States, and processed tens of millions of transactions through its system, totaling more than $16 billion in funds. These funds encompassed suspected proceeds of credit card fraud, identity theft, investment fraud, computer hacking, child pornography, narcotics trafficking, and other crimes.
“Mark Marmilev spent years designing and maintaining the technological architecture that allowed Liberty Reserve to operate a global payment processor and money transfer system that catered to criminals,” says Manhattan US Attorney Preet Bharara. “Now, he will pay for that crime with five years in federal prison.”
In addition to the jail time, the government is also seeking the forfeiture of Gourmet Boutique, a retail grocery business located in Brooklyn, New York, and the forfeiture of Marmilev’s interest in Grimaldi’s, a pizzeria located in the Coney Island area of Brooklyn, New York. According to the complaint, Marmilev purchased these business interests using more than $1.6 million in Liberty Reserve proceeds.