News has emerged that Alexander Vinnik, a Russian citizen, currently being held in a Greek jail suspected of heading up a cryptocurrency exchange that helped criminals launder billions of dollars, could prove to be an essential part of the Robert Mueller-led investigation into Fancy Bear, the name given to Russian military intelligence officers accused of influencing the 2016 US elections.
Vinnik, who was arrested last year after accusations from US prosecutors, is currently at the center of an extradition tug of war between Russia, France, and the United States, with Russia reportedly threatening retaliation against Greece if they choose to hand him over to one of the other two countries.
These heavy-handed tactics that are apparently being used by Russia over a seemingly innocuous financial criminal are more understandable if his involvement with the Fancy Bear case proves to be true.
Fancy Bear is the name given to a Russian hacking group that reportedly serves the political interests of the Russian government, which seemingly includes helping foreign candidates that are favored by it to win elections.
Valuable insight into Russian cybercrime
Cryptocurrency analytics firm Elliptic have claimed that the exchange supervised by Vinnik has handled some bitcoins traced to Fancy Bear, which makes Vinnik a person of interest for the Robert Mueller investigation into the goings on during the 2016 US elections which saw Donald Trump elected as US President.
Vinnik, who denies the US money laundering charges, is just one of a number of Russian hackers indicted by the US, some of whom are believed to be able to provide valuable insight into Russian cybercrime that goes far beyond their individual cases.
Ilias Spyrliadis, the lawyer for Vinnik, claims that his client had no control over the reported USD 9 billion worth of bitcoin that flowed through the crypto exchange BTC-e.
Spyrliadis also announced that his client will not comment on the Russian fraud accusations and that he flatly denies the French charges, which include money laundering.
The US claims that Vinnik and BTC-e accommodated cybercriminals and allowed them to launder criminal proceeds from bitcoin and other cryptos, while not properly vetting customers who could move money in and out of the exchange anonymously.
This type of anonymous service is the kind of operation that Mueller says was used by Russian military intelligence officers to buy time on servers that were used to launch attacks.
Elliptic Chief Data Officer Tom Robinson commented that “there was a strong link between much of the funds allegedly used by the Fancy Bear group and BTC-e.”
“What I can’t say for certain is whether Fancy Bear obtained them directly from BTC-e, or whether there was an intermediary.”
Vinnik “in no way” running BTC-e
According to his lawyer, there was no way for Vinnik to know who was using the BTC-e platform, and while he was undoubtedly an expert who was working for BTC-e, he was “in no way running it.”
“Mr. Vinnik could sometimes see a passport and ID when performing the transactions, but was in no place to know whether this person was using a fake ID, whether he or she was wanted by Interpol or involved in anything,” continued Spyrliadis.
Vinnik has been wanted by the US for more than a year now in relation to the Fancy Bear investigation, and the Supreme Court in Greece ruled in December that he could subject to extradition to the US to face charges in San Francisco, but this process has been stalled by the requests lodged by both France and Russia, both of which were approved by the Greek Supreme Court.
As things stand, the final decision will rest with Greece’s new Justice Minister, who will also have to examine a political asylum request from Vinnik before making any decision.
Crypto exchanges of great interest to the US
Arkady Bukh, who is a lead attorney representing Yevgeniy Nikulin, a suspect extradited from the Czech Republic to the US on charges of hacking LinkedIn and Dropbox in 2012, believes that cooperation from Vinnik could open the door for US investigators to glean valuable strategic information on Russian hackers.
Gaining access to emails, names and bank accounts related to Russian hacking is what the US case against Vinnik is really about claims Bukh, who claims that crypto exchanges are “extremely important and of great interest to the U.S.”
Bukh, who isn’t representing Vinnik at the time of writing says he has been in touch with associates of Vinnik to discuss the possibility of getting him legal representation outside of Greece.
The first port of call for the US is getting their hands on Vinnik though, and any information he has on the Fancy Bear investigation will rest on extradition to the US, which is something Russia seems to be hellbent on ensuring doesn’t happen.
The Russian Foreign Ministry didn’t hide its intentions when it made the following comment after Greece ruled to allow extradition to France last month –
“Several days after taking an unfriendly decision to expel Russian diplomats and to deny entry to several Russian citizens, they have adopted a decision to extradite Russian citizen Alexander Vinnik to France.”
“It is obvious that Russia cannot leave these actions unanswered.”
Assassination attempt on Vinnik
Alexander Vinnik has survived an assassination attempt during his yearlong extradition journey, and has reportedly written “at least” four “confession letters.”
Earlier this year the Russian news agency Sputnik reported that an assassination attempt was made on Vinnik under the order of someone connected with the Russian criminal underworld, although the article did stress that the special services of any country were not involved.
It would seem that as keen as the Russian Government is to usurp the attempts by the US and French authorities to extradite Vinnik and bring him to Russia, certain organizations and individuals are just as keen to see him not come to Russia for fear of what information he may have.
The case continues, with the final decision on what will become of Alexander Vinnik seemingly resting with the new Greek Justice Minister, Michalis Kalogirou.
Lover of all things crypto, blockchain and AI, professional tech scribe & part of the editorial team at Crypto Disrupt.