Samourai Wallet: Shocking Claim Feds Hid ‘Clear’ FinCEN Guidance
In a significant development for the crypto community, lawyers for Samourai Wallet’s founders have made a shocking claim: they allege federal prosecutors deliberately hid crucial information suggesting the popular crypto mixer likely didn’t need a license from the Treasury Department’s Financial Crimes Enforcement Network (FinCEN).
Samourai Wallet Founders Face Charges
Keonne Rodriguez and William Hill, the co-founders of Samourai Wallet, were arrested in April 2024 and charged with conspiracy to operate an unlicensed money transmitting business and money laundering conspiracy. Prosecutors allege their mixing service facilitated over $2 billion in illegal transactions.
FinCEN Guidance Allegedly Withheld
According to a recent letter filed in Manhattan federal court by the defense team, prosecutors disclosed details of a conversation with FinCEN guidance representatives that took place six months *before* the charges were filed. During this conversation, FinCEN staff reportedly indicated that because Samourai Wallet does not take custody of user funds (by holding private keys), it would “strongly suggest that Samourai is NOT acting as an MSB [money services business]” requiring a FinCEN license.
The defense claims prosecutors were obligated to disclose this information much earlier but suppressed it for over a year, only revealing it on April 1, 2025. This delay is central to their argument for dismissal.
Defense Strategy and Money Laundering Charges
The defense argues that if Samourai Wallet was not considered a money services business under FinCEN’s interpretation, then the charges of operating without a license are invalid. They contend that Rodriguez and Hill lacked fair notice and believed they were acting lawfully based on this type of guidance.
The government’s case hinges on the argument that despite not holding private keys, Samourai Wallet functionally controlled the crypto, enabling illicit activity and contributing to money laundering charges. However, FinCEN staff reportedly acknowledged this was a “difficult argument” for prosecutors, as it hasn’t been explicitly addressed in existing guidance.
Impact on Crypto Regulation Cases
This case highlights the ongoing complexities and disputes surrounding crypto regulation, particularly concerning privacy-enhancing tools like mixers. The defense plans to renew their bid to dismiss the case, leveraging the newly disclosed FinCEN information and the Justice Department’s recent memo suggesting it wouldn’t prosecute unwitting violations of regulations by mixers. The outcome could have significant implications for future enforcement actions in the crypto space.
Summary
The legal battle involving Samourai Wallet’s founders has taken a dramatic turn with the allegation that prosecutors concealed FinCEN guidance favorable to the defense. This development raises serious questions about prosecutorial conduct and the clarity of existing crypto regulation. The defense hopes this new information will lead to the dismissal of the unlicensed business and money laundering charges, setting a potential precedent for similar cases involving crypto mixer services.
