A Miami judge has dismissed charges against a Florida-based bitcoin seller after he was indicted in 2014 on illegal money transmission and money laundering charges. Judge Teresa Mary Pooler sided with the defense’s argument that bitcoin doesn’t constitute a form of money within the confines of Florida’s legal system, stating in a ruling issued today that Michell Espinoza doesn’t qualify as a money transmitter as argued by the prosecution. The case was tried in the Eleventh Judicial Circuit of Florida.
Observers say that the ruling exposes how state statutes don’t account for bitcoin and digital currencies – a gap that could ultimately lead to legislative action both in Florida and beyond.
The case dates back to late 2013, when a task force involving the Miami Police Department and the US Secret Service began investigating bitcoin trading activity in the area. Espinoza was contacted by Detective Ricardo Arias and Special Agent Gregory Ponzi via bitcoin marketplace LocalBitcoins, arranging several meetings between January and February 2014.
It was during those meetings that undercover agents indicated that they intended to purchase stolen credit card numbers with the digital currency. Espinoza was ultimately arrested during a planned sale of $30,000 in bitcoin, after selling $1,500 in bitcoin to the agents.
Yet in her ruling, Judge Pooler rejected the idea that Espinoza was engaged in any illegal activity as it related to both the money laundering and money transmission charges.
On the latter point, she said that the statute as it exists today accounts for financial intermediaries (citing Western Union in particular), whereas in her view, Espinoza was an individual selling his bitcoins directly.
Pooler wrote: "This court is unwilling to punish a man for selling his property to another, when his actions fall under a statute so vaguely written that even legal professionals have difficulty finding a singular meaning." […]
