- Roman Storm is scheduled to stand trial on December 2, 2024, on allegations of laundering funds through Tornado Cash.
- The judge rejected Storm’s claim that his code is protected by the First Amendment.
- Prosecutors must prove Storm knew he was dealing with proceeds of crime, though they do not have to show knowledge of specific criminal incidents.
Roman Storm, co‑founder of the cryptocurrency mixing service Tornado Cash, is set to appear in federal court in New York on December 2, 2024, after a U.S. district judge denied his motion to dismiss money‑laundering charges.
U.S. District Judge Katherine Polk Failla of the Southern District of New York denied the motion during a telephone conference on September 26, clearing the way for the case to proceed to trial.
Tornado Cash founders face multiple criminal counts
Storm and co‑founder Roman Semenov face multiple charges, including conspiracy to commit money laundering, conspiracy to violate the International Emergency Economic Powers Act (IEEPA), and conspiracy to operate an unlicensed money transmitting business.
The indictment alleges Tornado Cash facilitated the laundering of more than $1 billion in illicit proceeds, some of which have been linked to the North Korea‑linked cybercrime group Lazarus.
In his motion to dismiss, Storm argued that his role in developing Tornado Cash’s software was protected speech under the First Amendment.
Judge Failla rejected that argument, finding that the “functional capacity” of software code is not equivalent to the freedom of speech as protected by the First Amendment. She emphasized that the government’s effort to combat money laundering and sanctions evasion is not an attempt to suppress speech.
The court also ruled that control is not a required element under the 1960 statute cited in the indictment, rejecting the defense contention that Storm needed to know about specific criminal acts to be charged.
Instead, the prosecution must show only that Storm knew he was handling proceeds of criminal activity.
Arguments about the right to a fair trial were also dismissed by the judge, who said Storm’s state of mind and intent are factual questions for a jury to resolve. Judge Failla further observed that Tornado Cash is not “meaningfully different” from traditional financial service providers and money‑transmission businesses, and therefore the defendant can be held accountable under existing laws.
The trial, expected to last approximately two weeks, could set an important precedent for how software developers are treated under U.S. law when their technology is used for unlawful purposes. Roman Semenov remains at large.