The Prosecutor office of the Southern District of New York charged two individuals from Arizona and Israel (Reginald Fowler and Ravid Yosef respectively) with offering shadow banking services to trading platforms dealing with cryptocurrencies. The order was released on April 30, 2019.
According to the press release published on the agency's official website, the charges include banking fraud and illegal money transmitting business. It was noted that the accused used to open accounts that might be used for money transfers via Global Trading Solutions.
“Reginald Fowler and Ravid Yosef allegedly ran a shadow bank that processed hundreds of millions of dollars of unregulated transactions on behalf of numerous cryptocurrency exchanges. Their organization allegedly skirted the anti-money laundering safeguards required of licensed institutions that ensure the U.S. financial system is not used for criminal purposes...," said U.S. Attorney Geoffrey S. Berman.
Fowler and Yosef reportedly worked at several companies that provided financial services to cryptocurrency exchanges. Under the agreement, Yosef many times misinformed banks to open accounts striving to get users' fiats.
It should be mentioned that the Global Trading Solutions' account opened with HSBC Bank N.A. was deposited with fiats by Bitfinex. Moreover, the company is said to be connected with Global Trade Solutions AG, the parent company of Crypto Capital Corp. that provided payment services from Panama and already appeared in the Bitfinex scandal.
As a result, Reginald Fowler and Ravid Yosef can face a sentence which can reach even 30 years in prison. However, the exact sentence will be determined only by the judge.