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18 Lewis & Clark L. Rev. 1 (2014)

handle is hein.journals/lewclr18 and id is 1 raw text is: ARTICLES WHACK-A-MOLE: WHY PROSECUTING DIGITAL CURRENCY EXCHANGES WON'T STOP ONLINE MONEY LAUNDERING by Catherine Martin Christopher Law enforcement efforts to combat money laundering are increasingly misplaced. As money laundering and other underlying crimes shift into cyberspace, U.S. law enforcement focuses on prosecuting financial institutions' regulatory violations to prevent crime, rather than going after criminals themselves. This Article will describe current U.S. anti- money laundering laws, with particular criticism of how attenuated prosecution has become from crime. The Article will then describe the use of Bitcoin as a money-laundering vehicle, and analyze the difficulties for law enforcement officials who attempt to choke off Bitcoin transactions in lieu of prosecuting underlying criminal activity. The Article concludes with recommendations that law enforcement should look to digital currency exchangers not as criminals, but instead as partners in the effort to eradicate money laundering and-more importantly-the crimes underlying the laundering. IN T RO D U CT IO N ............................................................................................. 2 1. U.S. ANTI-MONEY LAUNDERING REGIME EXPLAINED AND C R IT IQ U ED ........................................................................................ 3 A . Statu tes ..................................................................................... 3 B . R egulations ............................................................................... 6 II. LAUNDERING WITH BITCOIN .......................................................... 10 A. H ow Does Bitcoin W ork? ........................................................... 10 B. W hy UseBitcoin ? ..................................................................... 15 1. Spending Power ................................................................ 15 * Visiting Professor of Legal Skills and Director of Bar Preparation Resources Office, Texas Tech University School of Law. J.D., University of Pittsburgh. The author wishes to thank Elizabeth Caulfield, Brie D. Sherwin, and DeLeith Duke Gossett for their assistance and support in the writing of this Article.

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