Texas Attorney General Ken Paxton on Tuesday filed a lawsuit against a bitcoin exchange, saying it is violating state and federal anti-money laundering laws.
In a statement to CoinDesk, Paxton said the Attorney General’s office received a complaint on August 8, 2018 from a Texas resident who had been using an address linked to the exchange to transfer bitcoin.
The complaint alleges that the account has been used to transfer between over $1.6 million in bitcoin and launder money through the exchange.
Paxton’s office will file suit within the next three weeks, he said.
The Texas Attorney Generals office received complaints on August 6, 2018 that a defendant in the CoinLab Bitcoin Exchange (COX) had transferred funds from an account linked to an online wallet to an offline wallet linked to a bitcoin wallet.
The investigation found that the Coin Lab CoinLab bitcoin exchange has been using the addresses of a number of Texas residents, some of whom were not even the intended recipients of funds transferred from the account.
The Attorney General has launched an investigation into whether there are any criminal violations of money laundering laws in connection with the alleged money laundering scheme, Paxtons office said in a statement.
Texas Attorney General Pam Bondi is a member of the U.S. Senate Banking Committee.