U.S. Extradited Russian Accused of Money-Laundering Tied to Ryuk Ransomware Gang

A Russian nationwide who was extradited from the Netherlands to Portland, Ore., this week pleaded not responsible to prices of allegedly laundering cryptocurrency proceeds from ransomware assaults within the U.S. and overseas, the Justice Division stated.

Denis Dubnikov,

a 29-year-old Russian, was arraigned in federal court docket for the District of Oregon on Wednesday. Prosecutors alleged that Mr. Dubnikov and his co-conspirators laundered bitcoin extracted from victims of Ryuk ransomware assaults by monetary transactions, in each crypto and fiat currencies, to hide the supply of the funds.

After coming into his plea, Mr. Dubnikov was launched from custody underneath a number of situations, together with monitoring of his pc exercise, in line with court docket paperwork.

At the least twelve extra people are going through prices within the case, in line with a court docket indictment unsealed Wednesday. Their names had been redacted within the indictment, and prosecutors didn’t establish Mr. Dubnikov’s alleged co-conspirators.

A Moscow entrepreneur, Mr. Dubnikov was detained whereas on trip in Mexico final November, The Wall Road Journal beforehand reported. He was expelled from Mexico and placed on a airplane to Amsterdam, the place Dutch police arrested him on Nov. 2 on a U.S. cost of conspiracy to commit money-laundering, in line with his lawyer

Arkady Bukh.

He supposed to plead not responsible to a U.S. cost of conspiracy to commit money-laundering, his lawyer stated on the time.

The DOJ accused Mr. Dubnikov of receiving and laundering greater than $400,000 in Ryuk proceeds in 2019, and alleges these concerned within the conspiracy laundered at the very least $70 million in ransom proceeds.

Recognized in 2018, Ryuk is a sort of ransomware that encrypts information and makes an attempt to delete any system backups on a pc or community. The Ryuk actors directed victims to pay in bitcoin and supplied them with a pockets tackle to make the ransom funds, in line with court docket paperwork.

Extra From Danger & Compliance

Ryuk has been used to focus on 1000’s of victims worldwide, and U.S. authorities have recognized it as an growing risk significantly to hospitals and healthcare suppliers within the U.S.

Mr. Dubnikov is scheduled to face a jury trial beginning on Oct. 4. If convicted, he faces as much as 20 years in jail.

David Angeli,

an lawyer at Angeli Legislation Group LLC in Portland, Ore., who’s representing Mr. Dubnikov, declined to remark.

The extradition comes as ransomware continues to be one of many prime cybersecurity dangers going through the Biden administration. Final yr alone, ransomware assaults stopped the supply of gasoline and different gas by the Colonial Pipeline; threatened the nation’s meals provide by shutting down meatpacker

JBS SA,

and put in danger sufferers’ lives by closing down hospital pc techniques throughout a pandemic.

Ransomware assaults are growing in frequency, sufferer losses are skyrocketing, and hackers are shifting their targets. WSJ’s Dustin Volz explains why these assaults are on the rise and what the U.S. can do to combat them. Picture illustration: Laura Kammermann

Write to Mengqi Solar at mengqi.solar@wsj.com

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Appeared within the August 19, 2022, print version as ‘U.S. Hyperlinks Russian to Laundering.’