Cryptocurrency Fraud Defense &
Crypto Money Laundering Defense
Former DOJ Prosecutors. Nationwide Trial-Ready Defense for Cryptocurrency Executives, Developers, Traders, and Individuals Facing Federal Crypto Investigations and Charges.
Based in Washington, D.C., Armstrong & Bradylyons PLLC defends cryptocurrency exchange executives, token and coin founders, DeFi protocol developers, blockchain engineers, NFT project creators, crypto fund managers, crypto traders, market makers, and other individuals in federal cryptocurrency fraud and money laundering investigations and cases nationwide.
The firm’s cryptocurrency fraud defense practice is built on over 25 years of combined experience as federal prosecutors at the nation’s preeminent fraud units: DOJ’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Virginia (EDVA).
At DOJ, Scott Armstrong, Drew Bradylyons, and Andrea Savdie tried 25 federal jury trials in complex white-collar fraud cases in federal courts across the country. These trials involved multi-defendant conspiracies, voluminous financial data, expert testimony, and cooperating witnesses.
Scott Armstrong served for nearly a decade at DOJ’s Fraud Section, including as an Assistant Chief in the Market Integrity and Major Fraud Unit, where he supervised investigations and prosecutions involving cryptocurrency fraud, crypto Ponzi schemes, NFT rug pulls, pig butchering schemes, cherry picking schemes involving cryptocurrency futures, and investment fraud schemes involving digital assets. Critically, Scott Armstrong served as lead trial counsel in the first-ever cryptocurrency market manipulation case charged under Title 15 of the United States Code: a landmark prosecution involving over $300 million in spoof and wash trades on cryptocurrency exchanges. Scott uses his first-chair trial experience in cryptocurrency matters to defend individuals charged with cryptocurrency market manipulation, money laundering, spoofing, wash trading, and related offenses.
Drew Bradylyons also served as Chief of EDVA’s Financial Crimes and Public Corruption Unit and, before that, at DOJ’s Fraud Section, where he supervised the Healthcare Fraud Unit’s Miami Strike Force and handled complex financial fraud cases. Andrea Savdie served at DOJ’s Fraud Section in the Miami Strike Force, where she charged and tried the most complex fraud cases in the country.
The firm now uses its trial and federal, white-collar experience to defend individuals in every corner of the cryptocurrency market at every stage of a federal investigation or case: from the first grand jury subpoena or regulatory inquiry, through federal indictment, and at trial.
Armstrong & Bradylyons PLLC defends individuals in the federal districts where DOJ and federal agencies most aggressively investigate and prosecute cryptocurrency fraud and money laundering cases, including the Southern District of New York (SDNY), the Eastern District of New York (EDNY), the District of Columbia (DDC), the Eastern District of Virginia (EDVA), the Southern District of Florida (SDFL), the Northern District of California (NDCA), the Southern District of Texas (SDTX), and the Northern District of Illinois (NDIL).
Armstrong & Bradylyons PLLC defends every cryptocurrency case from the start as if it will go to trial. That is not an empty slogan. It is the firm’s operating principle, and it is grounded in trial experience forged in federal courts around the country.
Preparation begins at engagement. From the investigation stage forward, the firm dives into the complex factual record of any cryptocurrency case. It develops the factual record, retains blockchain analytics experts where appropriate, identifies and prepares witnesses, and builds the case theory. All of this work builds towards a presentation to a jury if the case cannot be resolved on favorable terms and must go to trial.
Trial readiness directly affects outcomes at every stage. Cryptocurrency cases are factually and technically complex. They are won or lost based on how well an advocate can weave together a compelling narrative from disparate parts: blockchain transaction data, wallet analysis, smart contract code, exchange records, communications evidence, and expert testimony on digital asset technology. The technical complexity of a federal cryptocurrency fraud case can easily overwhelm an inexperienced practitioner.
The firm’s attorneys have tried these issues before federal juries. Scott Armstrong tried the first-ever cryptocurrency manipulation case under Title 15, a multi-week trial involving over $300 million in alleged spoof and wash trades, voluminous exchange data, blockchain tracing evidence, and ephemeral communications on messaging platforms. That is the level of trial experience the firm brings to every cryptocurrency defense engagement.
The firm’s cryptocurrency fraud defense practice is built on the principle that effective defense requires the credible ability to try the case. With 25 federal jury trials across the country, the firm’s trial record is not aspirational. It is a fact.
Armstrong & Bradylyons PLLC relishes the opportunity to go to trial to defend its clients. The firm’s willingness to go to trial and its hard-earned skills at trial provide significant leverage in dealing with federal prosecutors and regulators.
The firm’s cryptocurrency fraud defense strategy is built on trial experience, command of blockchain analytics and digital asset transaction data, and deep knowledge of the evolving regulatory framework governing cryptocurrencies and digital assets. These analytical tools are put to use at every phase of a case, from the initial federal investigation through trial.
The firm’s attorneys have prosecuted complex financial fraud cases at the highest levels of DOJ and tried 25 federal jury trials in cases involving digital assets, securities, commodities, and healthcare. That hard-earned trial experience — including Scott Armstrong’s role as lead trial counsel in the first-ever cryptocurrency manipulation case under Title 15 — shapes every aspect of the firm’s defense practice in cryptocurrency cases.
Blockchain and Transaction Data Analysis
Federal cryptocurrency prosecutions are built on blockchain transaction data, wallet analysis, exchange records, and ephemeral messages on platforms like Telegram, Discord, and Signal. Federal prosecutors rely on blockchain analytics firms and government analysts to trace the flow of digital assets, attribute wallet ownership, and construct loss calculations that drive sentencing exposure under the Federal Sentencing Guidelines.
The firm meets these allegations head on. It conducts detailed analysis of blockchain data, wallet activity, smart contract transactions, and exchange records to challenge the government’s tracing methodology and identify weaknesses in the prosecution’s case. The firm’s attorneys have worked with complex financial transaction data for years, both as federal prosecutors building cases and as defense counsel dismantling them.
Smart Contract and Protocol Analysis
The firm reviews smart contract code, DeFi protocol architecture, and token economics to establish the legitimate technical and commercial basis for the client’s project or conduct. This review is critical to challenging the government’s characterization of technical design decisions as evidence of fraudulent intent. In cases involving DeFi exploits, protocol vulnerabilities, and token launches, the ability to translate complex blockchain technology into clear, persuasive evidence for a federal jury is essential. The firm retains independent blockchain engineers and smart contract auditors as expert witnesses where appropriate.
Digital Asset Classification and Regulatory Defense
Many federal cryptocurrency prosecutions depend on the government’s classification of a digital asset as a security, commodity, or money transmitting instrument. The regulatory landscape for digital assets is fragmented, evolving, and often ambiguous. The SEC, CFTC, FinCEN, and DOJ have asserted overlapping and sometimes conflicting jurisdiction over digital assets. The firm challenges the government’s classification of digital assets and its application of securities laws, commodities laws, and money transmitting statutes to cryptocurrency transactions. Regulatory ambiguity is a powerful defense tool in negotiations with federal prosecutors and before a jury. The firm leverages it aggressively.
Money Laundering Tracing and Proceeds Analysis
Federal money laundering charges in cryptocurrency cases require the government to establish that funds constitute proceeds of specified unlawful activity and that the defendant conducted or attempted to conduct a financial transaction with the intent to conceal or promote the unlawful activity. The firm challenges the government’s underlying theory of illegality, tracing methodology, wallet attribution, and proceeds calculations. The firm’s deep familiarity with blockchain analytics tools, including Chainalysis, TRM Labs, and CipherTrace, allows it to identify and exploit weaknesses in the government’s financial tracing evidence at every stage of the case.
Cryptocurrency fraud investigations and cases target a wide range of individuals: from the founders and executives who built and operated digital asset platforms to the developers, traders, marketers, and financial professionals who participate in the cryptocurrency market. Armstrong & Bradylyons PLLC defends these individuals in federal investigations, at trial, and in regulatory proceedings.
Defense of Cryptocurrency Exchange Executives and Operators
The firm defends the founders, executives, officers, and operators of cryptocurrency exchanges and DeFi trading platforms or protocols in federal fraud and money laundering investigations and prosecutions. Exchange operators are high-priority targets for DOJ, the SEC, and the CFTC. Federal prosecutors target exchange executives who allegedly operated unregistered exchanges, failed to implement adequate anti-money laundering (AML) and know-your-customer (KYC) controls, facilitated the laundering of illicit proceeds through their platforms, manipulated trading activity, or misappropriated customer funds. The firm defends exchange executives against these allegations and challenges the government’s theories of liability, knowledge, and intent.
Defense of Token Founders and Coin Creators
The firm defends the founders and promoters or marketers of cryptocurrency tokens, coins, and initial coin offerings (ICOs) in federal securities fraud, wire fraud, and money laundering investigations and prosecutions. Token founders face federal charges when the government alleges that they made false or misleading statements to investors about the utility, technology, development roadmap, or financial backing of their digital asset project. The firm is equipped to challenge the government’s proof that any false statement was either false or material to investors. Where appropriate, it also challenges the government’s classification of the digital asset as a security and its characterization of the founders’ statements and marketing as false and misleading.
Defense of DeFi Protocol Developers and Blockchain Engineers
The firm defends developers, engineers, and architects of decentralized finance (DeFi) protocols, decentralized applications (dApps), and blockchain infrastructure in federal fraud and money laundering investigations. Developers face criminal exposure when the government alleges that the protocol they built was designed to facilitate fraud, market manipulation, or money laundering, or when a smart contract exploit or protocol failure causes investor losses. The firm defends developers by challenging the government’s technical characterization of the protocol’s design and operation, establishing the legitimate technological purpose of the developer’s work, and attacking the government’s view or wrongful or criminal intent.
Defense of NFT Project Creators
The firm defends the creators, developers, and promoters of non-fungible token (NFT) projects in federal fraud investigations and prosecutions. NFT project creators face federal charges when the government alleges that they engaged in rug pulls, made false representations about the project’s roadmap or utility, artificially inflated the price of NFTs through wash trading, or misappropriated investor funds. DOJ has aggressively pursued NFT fraud cases in recent years, and the firm defends NFT project creators against wire fraud, securities fraud, and conspiracy charges arising from these allegations.
Defense of Crypto Fund Managers and Investment Advisers
The firm defends managers, advisers, and operators of cryptocurrency investment funds, including hedge funds, venture funds, pooled investment vehicles, and Digital Asset Treasuries or DATs, in federal fraud investigations and prosecutions. Crypto fund managers face federal charges when the government alleges that they made fraudulent misrepresentations about fund performance, strategy, or risk, operated crypto Ponzi schemes, misappropriated investor funds, or engaged in cherry picking schemes involving cryptocurrency investments, futures activity, and other digital asset derivatives. The firm defends fund managers against securities fraud, wire fraud, commodities fraud, and investment adviser fraud charges.
Defense of Crypto Traders and Market Makers
The firm defends professional traders, market makers, and quantitative trading firms in cryptocurrency fraud and market manipulation investigations and prosecutions. Traders and market makers face federal charges when the government alleges wash trading, spoofing, layering, front-running, or other manipulative trading activity in cryptocurrency markets. The firm’s experience in securities and commodities fraud prosecutions at DOJ, including trial experience in the first-ever cryptocurrency market manipulation case under Title 15, provides the foundation for defending traders and market makers against these charges.
Defense of Individuals in Ransomware, SIM Swap, and Cyber Fraud Cases
The firm defends individuals in cases involving cryptocurrency and allegations of ransomware attacks, SIM swap fraud, social engineering exploits, computer intrusion, and the laundering of cryptocurrency proceeds derived from cyber fraud. These cases are investigated by the FBI, HSI, the Secret Service, and IRS-CI, and are prosecuted under the Computer Fraud and Abuse Act (18 U.S.C. § 1030), wire fraud (18 U.S.C. § 1343), identity theft (18 U.S.C. § 1028A), and money laundering statutes.
The firm’s cryptocurrency defense practice spans the full range of fraud schemes that DOJ and federal agencies investigate and charge. The firm defends individuals in investigations and prosecutions involving the following areas:
Crypto Ponzi Schemes and Investment Fraud
The firm defends individuals in cases involving allegations of cryptocurrency Ponzi schemes, pyramid schemes, and fraudulent investment platforms. These cases involve allegations that the defendants solicited investments in cryptocurrency trading programs, yield-generating platforms, or token projects and used new investor funds to pay returns to earlier investors. Crypto Ponzi scheme cases are among the most aggressively prosecuted cryptocurrency fraud cases and often involve significant alleged investor losses, making them high-priority targets for DOJ, the SEC, and the CFTC. Both Scott Armstrong and Drew Bradylyons have extensive trial and investigative experience with Ponzi Schemes and allegations of investment-fraud schemes.
NFT Rug Pulls and NFT Fraud
The firm defends the creators, developers, and promoters of NFT projects in cases involving allegations of rug pulls or alleged schemes in which the project creators allegedly abandoned the project and misappropriated investor funds after generating sales. NFT rug pull cases also involve allegations of wash trading to inflate NFT prices, false representations about project roadmaps and utility, and misuse of project treasury funds. The firm challenges the government’s characterization of the project and its allegations of fraudulent intent.
DeFi Protocol Exploits and Smart Contract Fraud
The firm defends developers, operators, and users of DeFi protocols in cases involving allegations of smart contract exploits, flash loan attacks, oracle manipulation, governance attacks, and reentrancy exploits. These cases raise novel legal questions about whether the exploitation of a smart contract vulnerability constitutes fraud or unauthorized access under federal law. The firm challenges the government’s legal theories and defends the client’s conduct as legitimate interaction with publicly available code.
Pig Butchering and Romance-Based Crypto Fraud Schemes
The firm defends individuals in cases involving pig butchering schemes and other romance-based or relationship-based cryptocurrency fraud schemes. These schemes involve allegations of grooming victims through social media or dating platforms, directing victims to fraudulent cryptocurrency investment platforms, and misappropriating victim funds through sham trading platforms that display fabricated returns. Individuals charged in these cases face wire fraud, money laundering, and conspiracy charges with considerable federal-sentencing exposure.
Cryptocurrency Money Laundering
The firm defends individuals in cases involving allegations of money laundering using cryptocurrency, including the use of mixers and tumblers, chain hopping between blockchains, privacy coins, peer-to-peer transactions, decentralized exchanges, and unlicensed money services businesses (MSBs) to conceal the source, ownership, or control of illicit proceeds. Money laundering charges under 18 U.S.C. §§ 1956 and 1957 carry penalties of up to 20 years’ imprisonment and are frequently charged alongside the underlying fraud offenses. The firm also defends individuals against charges of operating an unlicensed money transmitting business under 18 U.S.C. § 1960.
Crypto Market Manipulation: Spoofing, Wash Trading, and Pump-and-Dump Schemes
The firm defends traders, market makers, and token promoters in cases involving allegations of cryptocurrency market manipulation, including spoofing and layering, wash trading to inflate volume, pump-and-dump schemes involving tokens and meme coins, coordinated trading to manipulate prices, and front-running. These cases are investigated and prosecuted by DOJ, the CFTC, and the SEC, and may involve parallel civil and criminal proceedings. The firm’s experience in complex commodities fraud and securities fraud cases at DOJ provides a critical advantage in defending these complex market manipulation charges. Scott Armstrong served as lead trial counsel in the first-ever cryptocurrency market manipulation case charged under Title 15. This trial involved over $300 million in alleged spoof and wash trades on cryptocurrency exchanges. That trial experience in the government’s landmark crypto manipulation prosecution provides the firm with critical experience of how federal prosecutors build, present, and attempt to prove digital asset manipulation cases before a jury.
ICO Fraud and Unregistered Securities Offerings
The firm defends the founders, promoters, and executives of initial coin offerings (ICOs), token generation events (TGEs), and other digital asset offerings in cases involving allegations of securities fraud, wire fraud, and the sale of unregistered securities. Federal prosecutors and the SEC target ICO founders who allegedly made material misrepresentations to investors, failed to register their offerings, or misappropriated offering proceeds. The firm challenges the government’s application of the Howey test and the classification of the digital asset as an investment contract.
Ransomware, Cyber Extortion, and SIM Swap Fraud
The firm defends individuals in cases involving allegations of ransomware attacks and cyber extortion involving cryptocurrency payments, SIM swap attacks to gain control of cryptocurrency accounts and wallets, social engineering exploits targeting crypto holders and exchanges, unauthorized access to computer systems under the Computer Fraud and Abuse Act (18 U.S.C. § 1030), and the laundering of cryptocurrency proceeds derived from cyber fraud. These cases involve complex digital forensics evidence and frequently carry severe federal sentencing exposure.
Bitcoin Mining Fraud and Crypto Mining Investment Schemes
The firm defends operators and promoters of cryptocurrency mining operations in cases involving allegations of fraudulent mining investment schemes, misrepresentation of mining capacity or hash rate, misappropriation of investor funds, sale of non-existent mining equipment, and inflated claims about mining profitability and returns. DOJ has investigated mining fraud cases as wire fraud and securities fraud, and these cases often involve significant investor losses and complex financial tracing.
A cryptocurrency fraud or money laundering case does not begin with a DOJ indictment or federal charge by the SEC or CFTC. It begins months or years earlier: when a federal agency opens an investigation and starts issuing subpoenas, requesting records from exchanges, and identifying targets. Armstrong & Bradylyons PLLC defends cryptocurrency executives, developers, traders, fund managers, and other individuals at this critical investigation stage: before charges are filed and before the government’s case is fully developed. This initial investigation defense is just as critical to protecting its clients as the trial defense.
Retaining experienced defense counsel at the investigation stage is one of the most consequential decisions an individual can make in a cryptocurrency fraud case. Early representation allows the firm to shape the trajectory of the investigation, protect the client’s rights, and position the case for the strongest possible outcome.
Armstrong & Bradylyons draws on its substantial former DOJ experience to guide its clients through complex cryptocurrency investigations.
Scott Armstrong served as an Assistant Chief at DOJ’s Fraud Section in the Market Integrity and Major Fraud Unit, where he supervised cryptocurrency fraud investigations and prosecutions around the country and served as lead trial counsel in 16 federal jury trials, including the first-ever cryptocurrency market manipulation case under Title 15 involving over $300 million in spoof and wash trades. Drew Bradylyons served as Chief of EDVA’s Financial Crimes and Public Corruption Unit and supervised complex financial fraud cases at DOJ’s Fraud Section. Andrea Savdie served as lead counsel in complex fraud cases at DOJ’s Miami Strike Force.
Collectively, the firm’s attorneys have tried 25 federal jury trials. That firsthand knowledge of how federal prosecutors and agents develop cryptocurrency fraud cases — from the first regulatory referral through grand jury presentment and jury verdict — allows the firm to anticipate the government’s strategy and mount an effective defense from the outset.
Grand Jury Subpoena Defense
The firm defends individuals who receive grand jury subpoenas in cryptocurrency fraud and money laundering investigations. A federal grand jury subpoena — whether a subpoena ad testificandum compelling testimony or a subpoena duces tecum compelling the production of documents, exchange records, wallet addresses, or communications — is often the first indication that an individual is a subject or target of a federal cryptocurrency investigation. Receiving a grand jury subpoena requires an immediate and strategic response.
The firm advises clients on the scope of the subpoena, asserts applicable privileges and objections, negotiates the terms of production or testimony with federal prosecutors, and — where appropriate — seeks to quash or limit the subpoena. The firm also advises clients on their Fifth Amendment rights and the implications of testifying before a grand jury, including the critical distinction between witness, subject, and target status. Responding to a grand jury subpoena requires experience and skill. The firm has both.
SEC, CFTC, and FinCEN Investigation Defense
The firm defends individuals and companies that receive subpoenas, investigative demands, and Wells notices from the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and the Financial Crimes Enforcement Network (FinCEN) in connection with cryptocurrency fraud, market manipulation, and money laundering investigations. These regulatory investigations frequently run in parallel with criminal investigations by DOJ and may result in civil enforcement actions, consent orders, disgorgement, and penalties, in addition to criminal referrals.
The firm responds to regulatory inquiries strategically: managing the scope of document production, protecting privileged and work-product materials, and advising clients on the implications of the regulatory investigation for any parallel criminal proceedings. The firm has an ever-present eye in dealing with civil regulators on the potential for criminal proceedings. The firm defends its clients in civil proceedings in a way that protects its clients’ position in a criminal proceedings.
FBI, IRS-CI, and HSI Investigation Defense
The FBI, IRS Criminal Investigation (IRS-CI), and Homeland Security Investigations (HSI) are the principal federal law enforcement agencies responsible for investigating cryptocurrency fraud and money laundering at the field level. These investigations may involve seizure warrants for cryptocurrency wallets, administrative subpoenas for exchange records and financial documents, interviews of employees, associates, and investors, and analysis of blockchain transaction data using government-contracted analytics platforms.
The firm defends individuals who are the subjects of FBI, IRS-CI, and HSI investigations. The firm engages directly with agents and the federal prosecutors supervising the inquiry to understand its scope and focus. In doing so, the firm protects its clients’ interests at every stage.
Cryptocurrency Asset Seizure and Forfeiture Defense
Federal law enforcement agencies routinely seek to seize and forfeit cryptocurrency assets in connection with fraud and money laundering investigations. The government may obtain seizure warrants for cryptocurrency held in exchange accounts, hardware wallets, software wallets, and smart contracts. Civil and criminal forfeiture proceedings under 18 U.S.C. §§ 981 and 982 and 21 U.S.C. § 853 can result in the permanent loss of substantial digital asset holdings.
The firm defends individuals against cryptocurrency seizure and forfeiture actions. The firm challenges the government’s tracing evidence and nexus to alleged criminal activity, and works to protect its clients’ crypto and digital assets however possible.
Parallel Proceedings
Cryptocurrency fraud investigations frequently generate parallel criminal, civil, and regulatory proceedings arising from the same set of facts. A single course of conduct may produce a criminal investigation by DOJ’s Fraud Section, another component of DOJ’s Criminal Division, or a U.S. Attorney’s Office; an SEC or CFTC enforcement investigation; a FinCEN enforcement action for BSA violations; state attorney general investigations; state money transmitter licensing proceedings; civil asset forfeiture actions; and private civil litigation by investors or counterparties. A high-profile cryptocurrency fraud investigation will be a veritable alphabet soup of federal and state authorities investigating the same conduct.
The firm coordinates the defense of individuals across all of these proceedings. It does so to ensure that actions taken in one forum do not compromise the client’s position in another. Managing parallel proceedings requires counsel who understand how evidence, admissions, and strategic decisions in one proceeding can be used against the client in others. The firm’s former federal prosecutors navigated these issues for years in complex financial fraud cases. The firm now uses that same experience to protect its clients across complex parallel investigations.
The firm’s attorneys have represented individuals and entities in high-stakes cryptocurrency fraud and money laundering matters at every stage — from pre-indictment investigations through trial. The following matters are representative of the firm’s cryptocurrency defense practice.
Secured the complete dismissal of an Emergency Cease and Desist Order filed by the Texas State Securities Board against executives of the Apertum Foundation for alleged fraud relating to the APTM or Apertum Token.
Represented a foreign national against a federal indictment charging conspiracy to commit wire fraud and conspiracy to commit money laundering for allegedly orchestrating a $260 million “social engineering” crypto heist.
Represented an individual in a DOJ investigation involving an alleged ring of actors engaged in SIM swaps, ransomware attacks, social engineering hacks, and computer fraud.
Represented a cryptocurrency mining and lending protocol, as well as its CEO, against a DOJ investigation involving alleged investment fraud relating to cryptocurrency investments.
Represented the founder of a leading DeFi protocol in connection with an investigation by the New York Attorney General (NYAG) into whether the protocol offered unregistered securities and did not disclose alleged protocol risks to users.
Represented a marketer in connection with an investigation by the Maryland Attorney General (MDAG) into alleged fraudulent practices relating to cryptocurrency tokens.
Secured the complete dismissal of an emergency TRO filed in federal court that improperly froze several cryptocurrency accounts of a crypto-trading executive.
Negotiated the complete withdrawal of a claw-back demand from a federally appointed receiver seeking approximately $1 million from an executive who had invested in a crypto and forex investment platform that was later determined to have operated as a Ponzi scheme.
At DOJ, served as lead trial counsel in a week-long trial in the first-ever trial conviction for conspiracy to commit securities price manipulation under Title 15 involving cryptocurrency and over $300 million in spoof orders and wash trades placed via an automated trading bot.
At DOJ, served as lead counsel in the first-ever criminal “cherry picking” scheme against a commodity-trading advisor and CEO of an investment firm involving cryptocurrency futures.
Federal Agencies That Investigate Cryptocurrency Fraud and Money Laundering
Cryptocurrency fraud and money laundering investigations are conducted by multiple federal agencies. Each agency brings distinct investigative tools. The firm defends individuals in cryptocurrency investigations brought by the following agencies.
DOJ’s Criminal Division or “Main Justice” in DC. DOJ’s Criminal Division operates through several components, including DOJ’s Fraud Section to coordinate and lead the department’s cryptocurrency enforcement cases. DOJ’s Criminal Division investigates and charges complex cryptocurrency fraud, money laundering, and sanctions evasion cases involving digital assets. As a former Assistant Chief at DOJ’s Fraud Section and federal trial attorney who has tried 16 federal jury trials — including the first-ever cryptocurrency manipulation case under Title 15 — Scott Armstrong brings direct knowledge of how DOJ cryptocurrency investigations and prosecutions are built, staffed, and pursued.
United States Attorney’s Offices (USAOs). Cryptocurrency fraud and money laundering cases are prosecuted by Assistant United States Attorneys in federal judicial districts across the country. The most active districts for cryptocurrency prosecutions include the Southern District of New York, the Eastern District of New York, the District of Columbia, the Northern District of California, the Eastern District of Virginia, and the Southern District of Florida. USAOs independently investigate and prosecute cryptocurrency fraud cases and frequently partner with DOJ’s Fraud Section or other DOJ components on major cryptocurrency prosecutions. Drew Bradylyons served as Chief of EDVA’s Financial Crimes and Public Corruption Unit, one of the most active white-collar prosecution offices in the country.
Federal Bureau of Investigation (FBI). The FBI investigates cryptocurrency fraud and money laundering as a component of its financial crimes and cyber crimes missions. FBI agents are frequently assigned to cryptocurrency task forces and work closely with DOJ prosecutors on complex digital asset fraud cases. The FBI also operates undercover operations targeting cryptocurrency money laundering networks and dark web marketplaces.
IRS Criminal Investigation (IRS-CI). IRS-CI is one of the most active federal agencies investigating cryptocurrency fraud, tax evasion involving digital assets, and money laundering. IRS-CI agents are trained in blockchain analysis and financial forensics and play a leading role in tracing cryptocurrency transactions and identifying wallet ownership in federal investigations.
Homeland Security Investigations (HSI). HSI investigates cryptocurrency-facilitated crimes, including money laundering, fraud, darknet marketplace activity, and sanctions evasion. HSI agents use blockchain analytics tools to trace the flow of digital assets and identify individuals involved in cryptocurrency-facilitated criminal activity.
Securities and Exchange Commission (SEC). The SEC brings civil enforcement actions against individuals and entities involved in cryptocurrency fraud, the sale of unregistered digital asset securities, market manipulation, and insider trading involving digital assets. SEC investigations frequently run in parallel with criminal investigations by DOJ.
Commodity Futures Trading Commission (CFTC). The CFTC brings civil enforcement actions involving fraud, manipulation, and false reporting in cryptocurrency spot markets and derivatives markets. The CFTC has asserted jurisdiction over Bitcoin and other digital assets as commodities and pursues enforcement actions against individuals and platforms that allegedly engage in fraudulent or manipulative conduct in these markets.
Financial Crimes Enforcement Network (FinCEN). FinCEN administers and enforces the Bank Secrecy Act (BSA) as it applies to cryptocurrency businesses, including money services businesses (MSBs) that deal in virtual currencies. FinCEN takes enforcement action against individuals and entities that fail to register as MSBs, fail to implement adequate AML programs, or fail to file required reports. FinCEN violations frequently form the basis of parallel criminal charges under 18 U.S.C. § 1960.
State Regulators and Attorneys General. State securities regulators, money transmitter licensing authorities, and state attorneys general pursue enforcement actions against cryptocurrency businesses and individuals operating without required licenses or engaging in fraudulent conduct. State investigations may proceed in parallel with federal proceedings. The firm defends individuals in state regulatory proceedings arising from cryptocurrency activity.
Federal Cryptocurrency Fraud and Money Laundering Charges
The firm defends individuals against the full range of federal charges brought in cryptocurrency fraud and money laundering cases. These cases typically involve one or more of the following federal criminal statutes.
Wire Fraud: 18 U.S.C. § 1343
Wire fraud is the cornerstone charge in most federal cryptocurrency fraud prosecutions. The statute targets schemes to defraud that use interstate wire communications, including internet communications, electronic fund transfers, cryptocurrency transactions, and blockchain transmissions. Convictions carry penalties of up to 20 years’ imprisonment. Federal prosecutors use § 1343 to charge a wide range of cryptocurrency fraud conduct, including false representations about token utility or development, fraudulent investment schemes, rug pulls, pig butchering schemes, and misappropriation of investor funds.
Money Laundering: 18 U.S.C. §§ 1956 and 1957
Federal money laundering charges under 18 U.S.C. § 1956 target individuals who conduct or attempt to conduct financial transactions involving the proceeds of specified unlawful activity with the intent to promote the unlawful activity, conceal the nature, source, or ownership of the proceeds, or avoid reporting requirements. Section 1957 targets the knowing engagement in monetary transactions in criminally derived property exceeding $10,000. Money laundering charges carry penalties of up to 20 years’ imprisonment under § 1956 and up to 10 years under § 1957. In cryptocurrency cases, the government targets the use of mixers, tumblers, chain hopping, privacy coins, and decentralized exchanges to launder proceeds.
Securities Fraud: 15 U.S.C. § 78j(b) and 17 C.F.R. § 240.10b-5
The SEC and DOJ bring securities fraud charges involving cryptocurrency when the government classifies a digital asset as a security under the Howey test. Securities fraud charges apply to individuals who allegedly make material misstatements or omissions in connection with the purchase or sale of digital asset securities, engage in insider trading, or manipulate the market for digital asset securities. Securities fraud carries penalties of up to 20 years’ imprisonment in criminal cases.
Commodities Fraud: 7 U.S.C. § 9(1) and 18 U.S.C. § 1348
The CFTC and DOJ bring commodities fraud charges involving cryptocurrency when the government classifies a digital asset as a commodity. Federal prosecutors charge individuals with commodities fraud for schemes to defraud in connection with commodity transactions, market manipulation, spoofing, wash trading, and false reporting of cryptocurrency prices and volumes. Scott Armstrong served as lead trial counsel in the first-ever cryptocurrency market manipulation case charged under Title 15 — including 7 U.S.C. § 9(1) — a landmark prosecution involving over $300 million in alleged spoof and wash trades. The firm brings that direct trial experience to every commodities fraud defense engagement involving digital assets.
Computer Fraud and Abuse Act (CFAA): 18 U.S.C. § 1030
The CFAA targets unauthorized access to computer systems and is frequently charged in cryptocurrency cases involving hacking, exploits, SIM swap attacks, and unauthorized access to cryptocurrency exchanges, wallets, and smart contracts. Penalties range from 5 to 20 years’ imprisonment depending on the nature and scope of the alleged unauthorized access.
Operating an Unlicensed Money Transmitting Business: 18 U.S.C. § 1960
Federal prosecutors charge individuals under § 1960 who allegedly operate cryptocurrency businesses that qualify as money transmitting businesses without registering with FinCEN or obtaining required state licenses. This charge frequently accompanies money laundering charges in cases involving cryptocurrency mixers, peer-to-peer exchanges, and over-the-counter trading operations. Convictions carry penalties of up to 5 years’ imprisonment.
Additional Federal Charges in Cryptocurrency Cases
DOJ commonly brings additional federal charges alongside the primary cryptocurrency fraud and money laundering counts. The firm defends individuals against these related charges in federal cryptocurrency prosecutions nationwide. These charges include conspiracy to commit wire fraud (18 U.S.C. §§ 371, 1349), conspiracy to commit money laundering (18 U.S.C. § 1956(h)), bank fraud (18 U.S.C. § 1344), tax evasion (26 U.S.C. § 7201), structuring financial transactions (31 U.S.C. § 5324), sanctions violations (IEEPA), identity theft (18 U.S.C. § 1028A), and conspiracy to defraud the United States (18 U.S.C. § 371). Each of these additional charges increases the sentencing exposure a defendant faces under the Federal Sentencing Guidelines.