- Roman Storm faces trial on December 2, 2024, over alleged money laundering through Tornado Cash.
- A judge rejected Storm’s defense that his code was protected by the First Amendment.
- Prosecutors must prove Storm knew he was handling proceeds of crime, not the specific criminal acts that generated them.
Roman Storm, one of the founders of the cryptocurrency mixing service Tornado Cash, is scheduled to stand trial on December 2, 2024, in New York after a U.S. federal judge rejected his bid to dismiss money laundering charges.
U.S. District Judge Katherine Polk Failla of the Southern District of New York denied the motion to dismiss during a telephone conference on September 26 and pushed the case forward to trial.
Founders of Tornado Cash charged on multiple counts
Storm and fellow 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 indictments allege Tornado Cash aided in laundering over a billion dollars in criminal proceeds, some of which prosecutors say were tied to the Lazarus cybercrime group reportedly supported by North Korea.
In his motion to dismiss, Storm’s legal team 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 code does not automatically equate to freedom of speech as protected by the First Amendment.
She emphasized that the government’s efforts to prevent money laundering and sanctions evasion are not, in her view, an attempt to suppress free expression.
The court also found that regulatory oversight was not a necessary element of the 1960s-era statutes cited in the indictments and rejected the claim that Storm had to have knowledge of particular criminal actions.
Instead, prosecutors must prove Storm knew he was dealing with proceeds from unlawful activity. The judge denied claims that procedural shortcomings warranted dismissal and held that Storm’s state of mind and intent are issues for a jury to decide.
Judge Failla added that Tornado Cash was not “materially different” from traditional financial services and money-transmitting businesses, making Storm subject to existing laws governing such activities.
The trial, expected to last about two weeks, could set a precedent for how software developers are treated under U.S. law when their technology is used for illicit purposes. Roman Semenov, the other founder, remains at large.