US Treasury imposes sanctions on cryptocurrency mixer Sinbad for alleged money laundering
The United States Treasury Department’s Office of Foreign Assets Control (OFAC) has taken action against Sinbad, a cryptocurrency mixer, for its alleged involvement in money laundering for the Lazarus hacking group based in North Korea. The announcement was made on November 29, with Sinbad accused of processing millions of dollars’ worth of virtual currency linked to the high-profile hacks of the Lazarus Group, resulting in a collective loss of around $820 million at the time.
Wally Adeyemo, the Deputy Secretary of the Treasury, emphasized the severe consequences that mixing services enabling criminals, like Sinbad, to launder stolen assets would face. The US government, together with its partners, is fully prepared to employ all available measures to prevent virtual currency mixers from facilitating illicit activities.
Seizure of Sinbad website multiple agencies
Multiple agencies, such as the US Department of Justice, FBI, Netherlands’ Fiscal Information and Investigation Service, Public Prosecution Service, and Finland’s National Bureau of Investigation, have seized the Sinbad website in response to these allegations. The Treasury clarified that the intent behind the sanctions is not punitive but rather to induce positive behavioral changes.
Past sanctions on cryptocurrency mixers
In the past, OFAC has imposed sanctions on other cryptocurrency mixers, including Tornado Cash and Blender, both accused of laundering funds for Lazarus. There were indications that Sinbad and Blender might be the same entity, given their similar on-chain behavior, suggesting a possible rebranding attempt to evade sanctions.
Legal actions against previous sanctions
After the imposition of sanctions on Tornado Cash, a group of individuals supported Coinbase filed a lawsuit against the US Treasury, alleging an overreach of authority. While a judge ruled in favor of the Treasury, users filed an appeal in November.
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