Russian National Arrested in Poland Over WEX Exchange Allegations
In a significant development, Polish law enforcement apprehended a Russian national associated with the defunct WEX cryptocurrency exchange. The individual is suspected of engaging in fraudulent activities and money laundering. Currently, the United States has requested his extradition, pending the completion of legal procedures.
Apprehension of the Alleged ‘Crypto King’ in Poland
Recent reports from Polish media have disclosed the arrest of a 37-year-old Russian individual in Warsaw. Due to local regulations, the suspect is referred to as “Dmitry V.,” believed to be Belarus-born Dmitry Vasiliev, the former chief executive of WEX. The arrest was executed by the Central Bureau of Police Investigation’s elite “Shadow Hunters” unit at a residence in the Wola area, as confirmed by spokesperson Krzysztof Wrześniowski.
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The Warsaw District Prosecutor’s Office issued the arrest warrant in response to an extradition request from the U.S. Department of Justice. “Dmitry V. is implicated in extensive fraud, unauthorized financial transfers, and laundering operations linked to one of the globe’s major cryptocurrency platforms,” Wrześniowski elaborated.
It is notable that Vasiliev was previously detained in Poland in August 2021 at Chopin Airport, based on Kazakhstan’s extradition request over similar crypto-related allegations. However, he was subsequently released and returned to Russia. The Polish authorities are puzzled by Vasiliev’s reentry and prolonged stay in the country, speculating that he lived discreetly to avoid detection.
Currently, the U.S. has renewed its extradition request, aiming to prosecute Vasiliev for his alleged offenses. If extradited, he could potentially face a prison sentence of up to 20 years, as Wrześniowski indicated. Vasiliev remains in custody, awaiting the conclusion of the extradition process to the United States.
Unraveling the $450 Million WEX Exchange Collapse
WEX, initially established to replace the shuttered BTC-e exchange, collapsed in 2018 amidst allegations of financial misconduct. BTC-e had ceased operations following an FBI probe into global money laundering and the concealment of funds misappropriated from Mt. Gox.
Although Dmitry Vasiliev was the public leader of WEX, reports suggest that Alexey Bilyuchenko, a partner of BTC-e’s Alexander Vinnik, orchestrated its operations. Bilyuchenko, with financial backing from millionaire Konstantin Malofeyev, launched WEX. Unfortunately, the exchange faced a catastrophic failure a year later, with $450 million of customer funds disappearing. According to the BBC, Bilyuchenko claimed to have lost control of WEX in the spring of 2018 due to deception by individuals posing as security officials.
The supposed agents persuaded him to transfer the funds to a Russian Federal Security Service (FSB) controlled account during a meeting with Malofeyev. Bilyuchenko alleged that associates of Malofeyev defrauded him; however, Malofeyev, known for his Kremlin connections, refutes these claims. Bilyuchenko initially evaded U.S. capture for his involvement with BTC-e but was later detained by Russian authorities in 2022 concerning the WEX debacle. In 2023, he faced charges from the U.S. authorities related to his role in the BTC-e exchange and the infamous Mt. Gox hack.
