The legal landscape surrounding the Samourai Wallet case has taken a significant turn, as defense attorneys have accused the prosecution of suppressing critical evidence that could potentially exonerate the co-founders of the mixing service. This assertion was laid out in a recent filing with Judge Richard Berman of the Southern District of New York (SDNY), prompting calls for a hearing to determine whether the charges against Keonne Rodriguez and William Lonergan Hill should be dismissed in light of this alleged violation.
According to the court documents submitted on Monday, Samourai Wallet’s legal team highlighted that back in August 2023—six months prior to the prosecution’s indictment— the Financial Crimes Enforcement Network (FinCEN) informed prosecutors that Samourai Wallet did not meet the criteria to be classified as a money transmitting business and therefore did not require a license to operate. Despite this critical piece of information, the prosecutors moved forward with the indictments against Rodriguez and Hill for conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business, without disclosing their communication with FinCEN until April 1, 2025.
The defense team’s filing asserted, “The fact that FinCEN took the same position regarding Samourai Wallet and conveyed it to these same prosecutors, and that the prosecutors nonetheless charged the Defendants with committing a crime is shocking.” Under the precedent set by the landmark Supreme Court case Brady v. Maryland, the prosecution is required to disclose any exculpatory evidence that might suggest a defendant’s innocence. This failure, characterized as a Brady violation, could lead to the dismissal of the case due to due process concerns.
The consequences of the government’s alleged withholding of information are already apparent, with Samourai Wallet’s lawyers arguing that this has adversely affected the defendants’ rights. They point to significant implications related to the court’s bail determinations, which have resulted in Rodriguez being confined to his home for almost a year, as well as the overall limitations placed on the defendants’ resources to mount a defense.
Additionally, just last month, the legal team for Samourai Wallet invoked the “Blanche Memo”—a directive from U.S. Deputy Attorney General Todd Blanche that urges Department of Justice staff to cease the prosecution of regulatory infractions related to cryptocurrency, particularly involving crypto exchanges or mixers for actions taken by their users. The prosecution has yet to respond decisively to this request, despite meetings held between the defense and prosecution on April 10.
If the DOJ decides against dropping the charges, Samourai Wallet’s lawyers have expressed their intention to file a motion to dismiss on multiple grounds, emphasizing that the defendants were not money transmitters and, therefore, could not logically be prosecuted for alleged licensing violations. They argue that even if the DOJ’s interpretation of applicable laws is correct, the defendants still lacked fair notice of potential legal repercussions, having spent a year under indictment while facing considerable financial strain in their defense efforts.
The next hearing in this ongoing case has been scheduled for July 22, 2025, at 1:00 p.m. ET. As the legal proceedings unfold, it’s imperative to monitor the potential ramifications of the court’s decisions on both the defendants and the broader cryptocurrency regulatory environment.
As of now, FinCEN has not provided a comment on the situation.
