Liberty Reserve Owner Arrested & Sentenced To 5Years Imprisonment.
Costa Rican prosecutor José Pablo González said Budovsky, a Costa Rican citizen of Ukrainian origin, has been under investigation since 2011 for money laundering using a company he created in the country called Liberty Reserve.
Local investigations began after a request from a prosecutor's office in New York. On Friday, San José prosecutors conducted raids in Budovsky's house and offices in Escazá, Santa Ana, southwest of San José, and in the province of Heredia, north of the capital.
Budovsky's businesses in Costa Rica apparently were financed by using money from child Indecency websites and drug trafficking.
New York conviction, According to records from the U.S. Justice
Department, on July 27, 2006, Budovsky and a partner identified as Vladimir Kats were indicted by the state of New York on charges of operating an illegal financial business, GoldAge Inc., from their Brooklyn apartments.
They had transmitted at least $30 million to digital currency account worldwide since beginning operations in 2002.
The digital currency exchange, GoldAge, received and transmitted$4 million between Jan. 1, 2006, and June 30, 2006, as part of the money laundering scheme.
Customers opened online GoldAge accounts with limited documentation ofidentity, then GoldAge purchased digital gold currency through those accounts; the defendants' fees sometimes exceeded$100,000.
Customers could choose their method of payment to GoldAge: wire remittances, cash deposits, postal money orders or checks.
Finally, the customers could withdraw the money by requesting wire transfers to accounts anywhere in the world or by having checks sent to any identified individual.
Budovsky and Kats were sentenced to five years in prison for engaging in the business of transmitting money without a license, a felony violation of state banking law, but got probation.