The U.S. Department of Justice (DOJ) has secured the extradition of Denis Mihaqlovic Dubnikov, a Russian citizen from the Netherlands. He will face trial in the United States on allegations of participating in money laundering for a ransomware group.
In a press release, the DOJ accused the 29-year-old of laundering as much as $400,000 that was proceeds from the victims of ransomware attacks. Overall, Dubnikov and his co-conspirators, who are yet to be identified, laundered as much as $70 million extracted using the Ryuk malware variant.
“After receiving ransom payments, Ryuk actors, Dubnikov and his co-conspirators, and others involved in the scheme, allegedly engaged in various financial transactions, including international financial transactions, to conceal the nature, source, location, ownership, and control of the ransom proceeds,” the release said.
The Ryuk malware variant was first identified in 2018. The malware operates by encrypting files and attempting to delete any system backups when it is executed on a computer or network. It targets both storage drives connected to or in the computer and those accessed remotely via networks.
The attacks targeted individuals and organizations throughout the United States and abroad. Victims were blackmailed into paying ransoms in digital assets to access their files.
One high-profile victim was the U.S. Coast Guard, which saw its operations stopped for over 30 hours following an attack perpetuated through an email phishing campaign in 2020. In the same year, the U.S. classified the malware variant as an “imminent and increasing cybercrime threat to hospitals.”
Earlier this year, the U.S. Department of State linked the ransomware to Conti, a Russian ransomware group. The department has promised a $15 million bounty for information on the group. Ryuk ransomware has also been linked to the North Korean Lazarus group.
US cracking down hard on digital assets money laundering
Dubnikov has already made his first appearance in a court in Portland. A five-day jury trial will be held for him starting on October 4, and he could face up to 20 years imprisonment if found guilty.
The DOJ’s investigation of the case was coordinated by the Ransomware and Digital Extortion Task Force, which was created to disrupt, investigate, and prosecute ransomware activity. The task force was created last 2021 after the U.S. elevated ransomware investigations to the same priority as terrorism.
Meanwhile, Dubnikov’s extradition is coming after the DOJ also secured the extradition of Alexander Vinnik, the founder of the now defunct BTC-e digital assets exchange and a Russian citizen from Greece, on allegations including money laundering, according to a report.
Watch: The BSV Global Blockchain Convention panel, Law & Order: Regulatory Compliance for Blockchain & Digital Assets
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.