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Police in Miami Beach in conjunction with the U.S. Secret Service’s Miami Electronic Crimes Task have arrested two men moving a large amounts of cash in and out of the Bitcoin virtual currency. Experts believe this could be the first case that bitcoin vendors have been charged with a crime.
Bitcoin is an anonymous digit currency that in recent months has gained a degree of acceptance among mainstream retailers and online betting sites.
Arrested were Michell Abner Espinoza, 30, and Pascal Reid, a 29-year-old Canadian citizen. Both engaged in facilitating high-dollar transactions via localbitcoins.com.
From Krebson Security:
Documents obtained from the Florida state court system show that investigators believe Reid had 403 Bitcoins in his on-phone Bitcoin wallet alone — which at the time was the equivalent of approximately USD $316,000. Those same documents show that the undercover agent told Reid he wanted to use the Bitcoins to buy credit cards stolen in the Target breach.
Nicholas Weaver, a researcher at the International Computer Science Institute (ICSI) and at the University of California, Berkeley and keen follower of Bitcoin-related news, said he is unaware of another case in which state law has been used against a Bitcoin vendor. According to Weaver, the Florida case is significant because localbitcoins.com is among the last remaining places that Americans can use to purchase Bitcoins anonymously.
- Aaron Goldstein, Gambling911.com
