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Federal agents have arrested Charles Riley Constant, an owner of digital currency ATMs under the Coindawg name. At the time of writing, he has been charged with money laundering, and he’s been accused of stealing COVID pandemic-based loans and converting them to BTC and other forms of crypto to hide them from prying eyes.
Charles Constant Is Facing Money Laundering Charges
Money laundering has long been a serious problem in the crypto space. As of late, we have received several reports and witnessed several headlines talking about foreign crypto mixers being shut down by agencies such as the Department of Justice (DOJ). Many of these mixers have allegedly been utilized by terrorist states such as North Korea to hide stolen digital funds which are then used to fund ongoing nuclear programs.
In the latest case, Constant is alleged to have been part of a scheme that claimed more than $1 million in COVID loans. Prosecutors claim he laundered as much as $700,000 of that money and sent it back to his co-conspirators through bitcoin purchases, while the remaining $300K he was quick to pocket himself. The money was “washed clean” through his Coindawg ATMs, and he was arrested for his purported crimes in late March.
Damian Williams – the U.S. attorney for the southern district of New York and no stranger to criminal cases in the digital currency arena – commented in an interview:
He converted the bulk of the crime proceeds into bitcoin for his co-conspirators and used a portion of the rest to start his own lucrative cryptocurrency ATM business.
During the COVID era, many businesses could file for what were called PPP loans to ensure they had the money to stay afloat and pay their remaining employees while enduring a harsh economy brought on by the virus. While this certainly came from noble intent, the ploy led to heavy loads of crime amongst executives and entrepreneurs who used the money for illicit purposes, especially given loan forgiveness was in place for companies that met certain terms.
Authorities claim the Small Business Administration (SBA) loans used by Constant were filed under false companies and identities. With the money he kept, he purchased the crypto ATM machines in question and had them stationed in both Texas and Oklahoma. Through these machines, he garnered as much as $3 million in crypto withdrawals and was able to collect on 15 percent transaction fees for every action.
So Much Crime Through BTC ATMs
As part of their investigation, federal agents have seized as many as 18 of these machines at press time.
Crypto crime has long occurred via bitcoin ATMs. Not long ago, we published a story about an elderly man living in Connecticut that was conned into sending $60K in BTC to scammers through a crypto ATM.