For most VPN users, Liberty Reserve is one of the best payment options to use to maintain anonymity just like bitcoin since users needed only to submit a name, address, email address, date of birth and occupation and the details are not verified for authenticity so you can use fake names and addresses and still use Liberty Reserve. It is also one of the best alternatives where PayPal is not accepted.

Panic spread on the Internet Friday as word about Arthur Budovsky Belanchuk’s arrest reached users of his digital currency business Liberty Reserve, which was shut down on Friday.

Budovsky, 39, was arrested on Friday in Spain as part of a money laundering investigation performed jointly by police agencies in the United States and Costa Rica. U.S. officials likely will seek his extradition.

Costa Rican prosecutor José Pablo González said Budovsky, a former U.S. citizen and naturalized Costa Rican of Ukrainian origin, has been under investigation since 2011 in Costa Rica for suspected money laundering using apparent shell companies he created to run Liberty Reserve.

Budovsky relocated to Costa Rica after he and partner Vladimir Kats were indicted on July 27, 2006, in New York on charges of operating an illegal financial business, GoldAge Inc. – a precursor to Liberty Reserve – from their Brooklyn apartments, according to the U.S. Justice Department. U.S. officials said the two had transmitted at least $30 million to digital currency accounts worldwide since beginning operations in 2002.

Budovsky and Kats were sentenced to five years in prison in 2007 for engaging in the business of transmitting money without a license, a felony violation of state banking law. They received five years probation.

Officials have not commented on how much money Liberty Reserve accounts handled, nor how many clients are affected by its closing. But those numbers could be higher than in the GoldAge case.

Via: ticotimes.net

Update 5/28/2013

It is official, Liberty Reserve will probably never return.

Liberty Reserve's website now shows a "This domain name has been seized" message

Here is the official press release link: