The story highlights how cryptocurrencies continue to generate controversy in areas such as money laundering.

A UK-based firm regulated by the Financial Conduct Authority is linked to a controversial cryptocurrency exchange caught up in a US money laundering case, investors reportedly have said.

There is “fresh evidence” of links between Mayzus Financial Services, a Russian-owned business incorporated in the UK, and BTC-e. The latter firm was one of the world’s largest cryptocurrency exchanges, and allegedly used by the Russian-sponsored Fancy Bear hacking group to pay for some of its cyber attack on the World Anti-Doping Agency. That situation led to a leak of the medical records of British Tour de France winners Sir Bradley Wiggins and Chris Froome, the Sunday Telegraph said.

BTC-e and Alexander Vinnik, a Russian national alleged to have operated the exchange, are facing charges in a California court which include money laundering, the ST said. Prosecutors allege that BTC-e lacked basic money laundering controls and the company was used as a means by which cyber criminals processed illicit funds. The ST said that Vinnik has been held in a Greek prison since he was arrested in 2017 by US FBI agents and local police. The US, France and Russia are locked in an extradition dispute over him. 

Since crypto-currencies such as Bitcoin surfaced, they have been criticised by governments and other bodies for being conduits for dirty money. While the blockchain distributed ledger technology connected to cryptocurrencies is not completely anonymous and leaves an audit trail, the use or misuse of cryptocurrencies has been a regulatory concern.

The report said that MFS has traded under different names, including MoneyPolo and it was under the FCA’s regulatory umbrella from 2012 until last year. MFS is owned by Sergey Mayzus, who now lives in the Czech Republic.