DOJ Reveals Shocking Scale of Crypto Laundering Tied to Russian Sanctions Evasion

A $530 million crypto laundering network has been busted, with the U.S. Department of Justice charging Russian national Iurii Gugnin in a sweeping case that could reset how regulators view crypto and sanctions enforcement.

Gugnin, living in New York, operated Evita Investments and Evita Pay, firms he cast as compliant payment providers. Prosecutors say he used these as fronts, deploying Tether’s USDT to funnel huge sums for Russian clients linked to sanctioned banks and even Russia’s nuclear agency.

How did a massive crypto laundering operation evade U.S. detection?

Gugnin reportedly falsified compliance records, doctored invoices, and misled U.S. banks into believing his businesses had no connection to sanctioned Russian entities. With these methods, nearly $530 million crossed borders disguised as legitimate payments.

He allegedly concealed his clients’ identities, some connected to Sberbank, VTB, and Sovcombank. Gugnin also secured a Florida license to transmit money using false claims, sidestepping deeper scrutiny.

Did you know?
Tether’s USDT is the most widely traded stablecoin in the world, often surpassing Bitcoin in daily volume and frequently used in global money flows including some of the riskiest or most opaque transactions.

What are the national security risks behind this Russian-led scheme?

The DOJ uncovered evidence that Gugnin enabled the purchase of U.S. export-controlled technology, including server components for Russia’s state nuclear agency, Rosatom. Such actions violate export controls and threaten U.S. national security by arming sanctioned actors with sensitive American technology.

Investigators link this new form of crypto-enabled sanctions evasion to larger efforts by Russian banks and government-linked companies to bypass international restrictions and continue overseas commerce.

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Fake compliance allowed $530 million to cycle through U.S. banks

Regulators say the core criminality was Evita’s false front as a regulated, AML-compliant business. In truth, Gugnin never implemented proper anti-money laundering protocols and ignored glaring risks as he advanced client transactions.

By failing to file suspicious activity reports and deceiving both banks and crypto exchanges, Gugnin built a shadow pipeline. This allowed sanctioned Russian parties to pay for restricted goods, move assets undetected, and potentially finance activities hostile to the U.S.

Tether’s global reach enabled high-speed laundering for sanctioned clients

Tether’s USDT became a key tool in Gugnin’s arsenal. By rapidly swapping digital assets across borders and into U.S. dollars, he created a liquid, borderless web that authorities now call a blueprint for illicit finance.

This case throws a spotlight on stablecoins’ dark side: speed and liquidity that serve as strengths for legal users but can become weaknesses when compliance is weak or willfully ignored.

The DOJ’s charges of 22 criminal counts, including wire fraud, sanctions evasion, and running an unlicensed money business, carry penalties of up to 30 years per offense. Gugnin is detained and faces trial in New York.

Now, crypto regulators worldwide are racing to toughen oversight for digital assets and exchanges, seeking to close the loopholes exploited by foreign adversaries and protect the integrity of the U.S. financial system in an age of programmable money.