In the high-profile case against Samourai Wallet’s co-founders, federal prosecutors have firmly denied accusations of withholding critical evidence that could impact the outcome of the trial. The legal battle centers on Keonne Rodriguez and William Lonergan Hill, who face charges linked to their roles in operating the privacy-focused cryptocurrency mixing service.
In a letter submitted last Friday to Judge Richard Berman of the Southern District of New York (SDNY), prosecutors argued against a motion filed by Rodriguez and Hill that sought a hearing to address what they described as a delayed disclosure of key information. The defense claims that prosecutors failed to timely share details of a conversation with the Financial Crimes Enforcement Network (FinCEN), which took place six months before charges were filed. According to the defense, FinCEN officials had conveyed to prosecutors that Samourai Wallet did not qualify as a money transmitting business and therefore did not require a license to operate.
Despite this guidance, federal authorities pressed forward, charging both Rodriguez and Hill with conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. Prosecutors allege that through Samourai Wallet, the pair laundered more than $100 million linked to a variety of crimes and deliberately catered to participants in dark and gray markets, including hackers and fraudsters.
The defense argues that the late disclosure of the FinCEN conversation constitutes a violation of due process under the Brady v. Maryland precedent. This landmark Supreme Court ruling requires the government to share any evidence favorable to the defense in a timely manner. Rodriguez and Hill’s legal team asserts that earlier access to this information could have influenced key decisions in the case, including bail and pre-trial motions.
Prosecutors, however, strongly rejected claims of misconduct. In their response, they contended that the discussion with FinCEN officials was informal and represented personal, non-binding opinions rather than a definitive regulatory position. They emphasized that courts have consistently held that legal opinions — as opposed to factual evidence — do not fall under Brady disclosure requirements.
“There is no Brady violation here,” prosecutors wrote. “The FinCEN conversation involved caveated and individual views, not material facts relevant to guilt or innocence.”
Moreover, they pointed out that the defense had access to the disputed materials seven months ahead of the scheduled trial, leaving ample time for preparation. Prosecutors also downplayed the significance of the FinCEN-related evidence in the broader context of the case, stating that the core allegations focus on an extensive money laundering operation — the more serious charge, which carries a maximum sentence of 20 years.
This dispute surfaces as the defense continues to press for dismissal of the case under the recently issued Blanche Memo, a directive from Deputy Attorney General Todd Blanche. The memo instructs Department of Justice prosecutors to scale back enforcement actions against crypto platforms and mixers based on their users’ conduct.
Rodriguez and Hill’s legal team formally requested that the DOJ drop the case on April 10, citing the memo. To date, prosecutors have yet to announce a decision, an unusually prolonged deliberation according to some former SDNY officials.
As the case moves forward, all eyes remain on how the court will interpret the timing and relevance of the evidence in question — a decision that could have ripple effects across future crypto-related prosecutions.
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