ATTENTION: Liberty Reserve, a Costa Rica – based “digital currency” which authorities claim is popular with cyber criminals, was shut down late last week, after the arrest of the company’s 39-year-old founder, Arthur Budovsky Belanchuk on Friday.
Budovsky was arrested in Spain following a joint investigation between Costa Rican and United States law enforcement agencies. Costa Rican authorities conducted raids of Budovsky’s home and offices in San José shortly before his arrest.
Budovsky, a Ukranian who has been reported to be a naturalized Costa Rican citizen, is thought to have financed a number of businesses in Costa Rica with proceeds that are claimed to originate through child pornography sites and drug traffickers who used the Liberty Reserve service.
Liberty Reserve was an unregulated money transfer business where users could keep their identity hidden. Authorities allege that a large portion if its user base came from underground economies and cybercrime.
However, the Internet has been abuzz since news broke of Liberty Reserve’s shutdown, with hundreds, if not thousands of former users from around the world claiming they were not involved in illegal activity, and that their businesses could be devastated should the funds in their Liberty Reserve accounts are not refunded.
Arthur Budovsky has been in trouble with the law several times. In 2006, Budovsky and his partner Vladimir Kats were indicted in the United States on charges related to a similar service called GoldAge, which they ran from their apartments in Brooklyn, New York. GoldAge allegedly transmitted close to $30 million illegally. Both were sentenced to five years in prison in 2007 but ended up serving only probation. Budovsky then left the United States and headed to Costa Rica, where he later started Liberty Reserve.
Other reports also had it that the United States may request Budovsky’s extradition back to the U.S. Soil to face charges there, though that process may prove to be difficult if not impossible. Costa Rican law prohibits the extradition of its citizens.
Source: InsideCostaRica.com
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