In a dramatic escalation of international crypto crime enforcement, Indian authorities have arrested Lithuanian national Aleksej Bešciokov, the alleged founder of the sanctioned cryptocurrency exchange Garantex.
The arrest, carried out by India’s Central Bureau of Investigation (CBI) in Kerala, comes at the request of United States authorities, who are seeking Bešciokov’s extradition on multiple financial crime charges.
According to a March 12 statement from the CBI, Bešciokov was detained while vacationing with his family in India. US prosecutors have charged him with conspiracy to commit money laundering, operating an unlicensed money-transmitting business, and violating the International Emergency Economic Powers Act.
An indictment filed on 27 February in the US District Court for the Eastern District of Virginia alleges that Bešciokov and co-conspirator Aleksandr Mira Serda facilitated illicit financial activities through Garantex, a cryptocurrency exchange that US authorities claim was used to launder proceeds from ransomware attacks, hacking schemes, narcotics sales, and sanctions violations. The indictment suggests that these activities have been ongoing since 2019.
If extradited, Bešciokov could face serious criminal penalties in the United States, adding to the growing list of high-profile crypto figures facing legal action on American soil.
Crackdown on Garantex Intensifies
Bešciokov’s arrest follows a series of enforcement actions against Garantex, including:
- Tether froze $27 million worth of USDT linked to the platform on March 6.
- Garantex suspending all services, including withdrawals.
- US authorities seizing three domains associated with Garantex’s operations.
The US Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Garantex in April 2022, accusing the exchange of deliberately violating Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) laws. The European Union followed suit in February 2024, citing Garantex’s involvement in Russia’s financial networks amid the war in Ukraine.
Despite these enforcement actions, Serda, Garantex’s co-founder and chief commercial officer, remains at large, raising concerns that other operators could still be involved in illicit financial activities.
Could Bešciokov Fight His Transfer to the US?
While Bešciokov’s arrest marks a significant victory for US prosecutors, his extradition to the United States is not guaranteed. Under India’s Extradition Act of 1962, Bešciokov could challenge his extradition in court, potentially delaying or even blocking his transfer.
Similar cases highlight the complex legal battles surrounding crypto-related extraditions:
- Do Kwon, Terraform Labs’ co-founder, was arrested in Montenegro in March 2023 but spent over a year fighting extradition before being sent to the US in December 2024.
- Sam Bankman-Fried, former CEO of FTX, was arrested in the Bahamas in 2022 and swiftly extradited to the US, where he was convicted of fraud and sentenced to 25 years in prison.
A Broader Crackdown on Illicit Crypto Activities
The arrest of Bešciokov is part of a broader effort by US and global authorities to dismantle crypto networks involved in financial crimes. With regulatory bodies increasing their scrutiny of digital assets, exchanges operating outside of compliance frameworks face mounting pressure.
As the extradition process unfolds, Bešciokov’s case will be closely watched for its implications on global crypto regulations and its impact on illicit financial flows in the digital asset space. Whether he successfully fights extradition or ultimately stands trial in the US, this case underscores the growing risks for crypto operators engaged in unregulated financial activities.
