U.S. takes pastor, software developer to trial over bitcoin exchange

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By Nate Raymond | NEW YORK

NEW YORK A Florida software engineer and a New
Jersey pastor engaged in lies and corruption to facilitate an
illegal bitcoin exchange business whose operators wanted to take
over a small credit union to evade scrutiny, a federal
prosecutor said on Wednesday.

At the start of a trial in Manhattan federal court,
Assistant U.S. Attorney Won Shin told jurors that programmer
Yuri Lebedev schemed with others to bribe Trevor Gross, the
pastor and head of a Jackson, New Jersey-based credit union
housed in his church.

Shin said Gross accepted bribes including a $150,000 church
donation in exchange for helping unlicensed bitcoin exchange
Coin.mx’s operator take over Helping Other People Excel Federal
Credit Union.

Coin.mx, which employed Lebedev while running through a
front called “Collectables Club,” in exchange could use the
credit union to evade scrutiny of banks wary of processing
payments by individuals buying the virtual currency.

“The bribes and lies had a simple, shared purpose: For the
defendants Lebedev and Gross and their co-conspirators to make
money,” Shin said.

But lawyers for Lebedev, 39, and Gross, 52, said they did
nothing wrong and were being blamed due to actions by Anthony
Murgio, who ran Coin.mx and who they said manipulated people
while trying to illegally grow the business.

“Yuri was in the wrong place at the wrong time with the
wrong people,” said Eric Creizman, Lebedev’s lawyer.

Kristen Santillo, Gross’ lawyer, said he was tricked into
believing Coin.mx was a memorabilia club, and thought there was
nothing wrong about a donation to the church, and which did not
benefit him personally.

“He didn’t know anything about what they were up to,” she
said.

The trial followed an investigation rooted in a data breach
that JPMorgan Chase & Co disclosed in 2014 that exposed
over 83 million accounts, leading to charges against nine
individuals.

Gross, Lebedev and Murgio were not accused of hacking. But
prosecutors said Coin.mx was owned by an Israeli behind the
breach, Gery Shalon.

Prosecutors say Shalon, together with Maryland-born Joshua
Samuel Aaron, orchestrated cyber attacks that resulted in the
theft of over 100 million peoples’ information.

Prosecutors said they carried out the hackings to further
other schemes with another Israeli, Ziv Orenstein, including
pumping up stock prices with promotional emails. Shalon, Aaron
and Orenstein have pleaded not guilty.

Regulators took the credit union into conservatorship in
2015. Murgio pleaded guilty to charges related to Coin.mx in
January.



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