Tornado Cash Developer Claims Prosecutors Hid Crucial FinCEN Evidence
A significant legal challenge is unfolding in the case against Tornado Cash developer Roman Storm. His defense team has filed a motion alleging that prosecutors withheld crucial exculpatory evidence that could impact the very definition of services like crypto mixers under US law.
Allegations of Withheld FinCEN Guidance
Attorneys representing Roman Storm recently submitted a motion asking the court to reconsider the dismissal of his case. The basis for this request centers on communications between prosecutors and the Financial Crimes Enforcement Network (FinCEN) dating back to 2023.
According to a letter sent by Storm’s attorneys to Judge Katherine Polk Failla on May 16, these FinCEN documents suggest that non-custodial crypto mixers, services that facilitate anonymous transactions, do not meet the legal definition of a “money transmitting business.” The defense contends that prosecutors were aware of this interpretation since at least 2023 but proceeded with cases against developers of such services, including Samourai Wallet and Tornado Cash.
Prosecutors have disputed the claim of withholding evidence, stating they provided the FinCEN communications within the standard legal discovery timeframe.
Drawing Parallels: Samourai Wallet and Exculpatory Evidence
The legal team for Roman Storm is leveraging the same set of FinCEN documents and arguments recently presented by the defense attorneys for the Samourai Wallet developers in their own case. This parallel highlights a potential systemic issue regarding the government’s understanding and prosecution of non-custodial mixing services.
Storm’s attorneys wrote in their letter:
“The disclosures in the Samourai case reveal that the government, at the very least, played fast and loose and, at worst, affirmatively misled this Court with its arguments about FinCEN guidance when responding to the motions to dismiss and to compel discovery.”
They argue that despite the government claiming only “superficial similarities” between the cases, the core legal question regarding whether crypto mixers constitute money transmission is identical, making the FinCEN guidance highly relevant as exculpatory evidence.
The Broader Context for Tornado Cash
This development occurs in the wake of other legal challenges related to Tornado Cash. A recent ruling by Federal Judge Robert Pitman on April 28 denied the Office of Foreign Assets Control (OFAC) the ability to reinstate sanctions against Tornado Cash, establishing a precedent relevant to non-custodial mixer cases. Despite this ruling, US federal prosecutors have continued with the case against Roman Storm, albeit with modified charges.
The defense’s assertion that the prosecution may have withheld crucial FinCEN guidance adds another layer of complexity to an already high-profile case that could significantly impact the legal future of privacy-enhancing tools in the cryptocurrency space.
Summary
The defense for Tornado Cash developer Roman Storm is mounting a vigorous challenge, claiming prosecutors failed to disclose exculpatory evidence from FinCEN guidance. This evidence, also cited in the Samourai Wallet case, allegedly clarifies that crypto mixers may not be legally defined as money transmitters. The outcome of this motion could have profound implications for the prosecution’s case against Storm and the broader regulatory landscape for privacy-focused blockchain services.
