Los Angeles-area man who ran multimillion-dollar unlicensed Bitcoin exchange business sentenced (Hugo Sergio Mejia)
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View the most recent statistics 2024 Year in Review ICE’s FY 2024 Annual Report View the annual report --> Media Inquiries Breadcrumb ICE Newsroom Los Angeles-area man who ran multimillion-dollar unlicensed Bitcoin exchange business sentenced to 3 years in federal prison Share Share on Facebook Share on X Share on LinkedIn Email this Page Print this Page Archived Content In an effort to keep ICE.gov current, the archive contains content from a previous administration or is otherwise outdated. This information is archived and not reflective of current practice. November 18, 2021Los Angeles, CA, United StatesFinancial Crimes Los Angeles-area man who ran multimillion-dollar unlicensed Bitcoin exchange business sentenced to 3 years in federal prison LOS ANGELES – A San Bernardino County man was sentenced today to 36 months in federal prison for operating an unlicensed business that exchanged at least $13 million in Bitcoin and cash, often for drug traffickers. As the result of an investigation by Homeland Security Investigations (HSI) Los Angeles and IRS Criminal Investigation, Hugo Sergio Mejia, 50, of Ontario, was sentenced by U.S. District Judge Cormac J. Carney. Mejia pleaded guilty on July 1 to one count of operating an unlicensed money transmitting business and one count of money laundering. From May 2018 to September 2020, Mejia operated a virtual currency business that exchanged Bitcoin for cash, and vice versa, charging commissions for these transactions. Mejia never registered his business with the Financial Crimes Enforcement Network, a bureau with the U.S. Department of the Treasury that collects and analyzes information to combat financial crimes, including money laundering. During the nearly 2½-year period, according to the plea agreement, Mejia exchanged at least $13 million. Mejia also established companies to mask his true activity, including Worldwide Secure Communications LLC, World Secure Data, and The HODL Group LLC. Mejia advertised his business online and was referred to customers by word of mouth, communicating with them via encrypted messaging services and meeting them in person at coffee shops. On several occasions between May 2019 and March 2020, Mejia met with a client, who was working with law enforcement, to exchange Bitcoin for tens of thousands of dollars in cash. On March 12, 2020, Mejia met with the client at a coffee shop in Irvine and facilitated the exchange of 14.273 Bitcoin for $82,150 in cash plus fees. During this meeting, the client informed Mejia that his primary customer was a methamphetamine buyer in Australia who purchased methamphetamine every four to six weeks and sold it in Australia for five times more than the average price in the United States. Mejia and the client who was working with law enforcement conducted five Bitcoin-cash transactions that cumulatively exceeded $250,000. “[Mejia] knew about the applicable regulations governing his money exchange business and purposefully flouted them,” prosecutors wrote in a sentencing memorandum. “That is because [Mejia] structured his money exchange business with the intent to establish an anonymous conduit for money laundering of drug trafficking proceeds.” As part of his plea agreement with the government, Mejia agreed to forfeit all assets derived from the illegal conduct, including $233,987 in cash seized from residences in Santa Ana and Ontario, silver coins and bars, and approximately $95,587 in various cryptocurrency seized. This case received assistance from the Costa Mesa Police Department and was prosecuted by the U.S. Attorney for the Central District of California’s International Narcotics, Money Laundering and Racketeering and Asset Forfeiture Sections. 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