An argument being presented in an American courtroom will alarm many common sense observers: bitcoin isn’t real money, so someone accused of laundering it shouldn’t be convicted of money laundering.
This is the argument that attorneys are using in asking a Florida judge to dismiss money laundering charges against Michell Espinoza, a Miami man who police say sold and laundered $1,500 worth of bitcoins to undercover detectives, according to The Miami Herald.
Charles Evans, an economics professor at Barry University, acting as a defense witness, told the court no central government or bank backs bitcoin, regulation of bitcoin varies by jurisdiction, and the IRS considers bitcoin trades the same as bartering. Evans called bitcoin “poker chips that people are willing to buy from you.” The professor was paid $3,000 worth of bitcoins for his appearance.
Espinoza’s lawyers, Prieto and Rene Palomino, want the charges dismissed since bitcoin is not technically considered a form of money under Florida law. Miami-Dade Circuit Judge Teresa Mary Pooler asked for more time to research the matter before making a decision.
Pooler said the topic is “the most fascinating thing I’ve heard in this courtroom in a long time.”
The case is believed to be the first money-laundering charge against someone accused of dealing in bitcoins.
Police came across Espinoza, who used the pseudonym MichellHack, on LocalBitcoins.com, a bitcoin exchange, and told him they wanted to use bitcoin to buy stolen credit card numbers. They met with him three times in person.
Police arrested Espinoza along with Pascal Reid, who pleaded guilty to acting as an unlicensed money broker.
Reid agreed to teach law enforcement about bitcoin in a plea bargain and was sentenced to probation.
Evans, the professor, told the court he has been involved with virtual currencies since they emerged in the 1990s. He also runs an organization called Conscious Entrepreneurship Foundation, a nonprofit that helps small businesses in developing nations.
Evans said bitcoin is expanding in places like Africa that have broken banking systems.
He compared bitcoin’s value to values assigned to comic books or baseball cards.
Also read: Warning: LocalBitcoins sellers are being arrested for money laundering
Tom Haggerty, the prosecutor, argued that bitcoin is the same as cash, noting that some restaurants accept it as payment. “You don’t purchase a hamburger with a comic book,” Haggerty said. “You usually purchase it with cash, or in this case, a bitcoin.”
Some Miami restaurants accept bitcoin, as does a plastic surgeon.
Some regulated services such as CoinBank, which functions in a manner similar to PayPal, allow customers to purchase and use bitcoin.
A Miramar, Fla. man was sentenced to 10 years in prison after buying Chinese-made, synthetic heroin from a Canadian prisoner.
Featured image from Shutterstock.
Last modified: March 4, 2021 4:48 PM