These days keeping your hard-earned money as cash hidden in your mattress is probably the safest way to keep your money yours, and Liberty Reserve SA has unfortunately proved that in a big way. According to Bloomberg News , the company and seven people- including founder Arthur Budovsky- were indicted of an international money-laundering conspiracy on May 28.
The company, much like Paypal, gives users the ability to to send and receive digital currency, which is obviously a profitable business in this digital age. The process was super simple; all you needed was a name, email address and birthday.
But here's something fishy-- and really, how did no one catch on to this-- prosecutors say it was structured to benefit criminals who wanted to conduct illegal transitions and launder the money that came out of their crimes.
According to Krebs On Security, the hacker community has been sufficiently shaken by the seizure of the site.
“... many that work and ply their trade in malicious software and banking fraud found themselves unable to access their funds. For example, a bulletproof hosting provider on Darkode.com known as ‘off-sho.re’... said he stood to lose $25,000, and that the Liberty Reserve shutdown ‘could be the most massive ownage in the history of e-currency.’”
Liberty Reserve also looks to have been the account of choice for hackers who stole $45 million from two Middle Eastern banks not so long ago. The site now been seized and there's no way to retrieve any of the digital money that was stored via Liberty Reserve.
Hackers who hack for money were hit big with this one, but some innocent people were caught in the mix. There’s no word yet on what will happen to the money belonging to the non-criminal types who were also using this service.
via Examiner National Edition Gadgets & Tech Channel Articles http://www.examiner.com/article/hackers-hit-hard-by-shutdown-of-digital-currency-business-liberty-reserve?cid=roadrunner