The Fiscal Information and Investigation Service (FIOD), responsible for investigating financial crimes in the Netherlands, has arrested a 29-year-old developer suspected of involvement in a money laundering scheme. 

According to the announcement shared on August 12th, the man has allegedly used Tornado Cash to “conceal criminal financial flows and facilitate money laundering”.

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FIOD had joined forces with Financial Advanced Cyber Team (FACT), which through their investigation identified that Tornado Cash was used to hide the funds retrieved from various hacks and scams. According to the announcement:

These included funds stolen through hacks by a group believed to be associated with North Korea. Tornado Cash started in 2019 and according to FACT, it has since achieved a turnover of at least seven billion dollars.

The Netherland authorities highlighted that their investigation started back in June of 2022.  The FIOD doesn’t rule out the possibility of multiple arrests related to this case in the future. 

The official FIOD statement notes that:

Investigations showed that at least one billion dollars worth of cryptocurrencies of criminal origin passed through the mixer. It is suspected that persons behind this organization have made large-scale profits from these transactions.

It seems that this week could be marked as one of the worst for Tornado Cash. On August 8th, the United States Treasury Department blacklisted 44 Tornado Cash addresses and placed them on the list with theorists and drug dealers. Following this decision, many crypto-related companies closed the doors for Tornado Cash and the sanctioned addresses. 

Online software development company GitHub was among the first ones to restrict access to sanctioned Tornado Cash addresses. Afterward, stablecoin issuer Circle, blockchain developer platforms Alchemy, and Infura.io. 

by Aaron S. – Expert Reviewer, BitDegree