The United States on Tuesday unveiled the world\'s \"largest\" money laundering probe targeting the digital currency operator Liberty Reserve, striking a major blow against what a prosecutor termed the \"Wild West\" of virtual banking. The Costa Rica-based entity, which handled huge amounts of money outside the control of national governments, is charged with running a \"$6 billion money laundering scheme and operating an unlicensed money transmitting business,\" the US Attorney\'s office for New York said. Prosecutors said Liberty Reserve processed at least 55 million illegal transactions for at least one million users \"and facilitated global criminal conduct.\" The probe involved law enforcement in 17 countries and \"is believed to be the largest money laundering prosecution in history,\" the prosecutor\'s office said. Liberty Reserve\'s principals were arrested Friday in a round-up launched simultaneously in Costa Rica, Spain and New York, sealing the fate of a company that had been one of the most successful in the popular but increasingly scrutinized world of unofficial banking and virtual currencies. The indictment accuses founder Arthur Budovsky -- a former US citizen who took on Costa Rican nationality -- and his partners of creating a firm that masqueraded as a convenient and legitimate money transfer system. In reality, the organization turned itself into the \"financial hub of the cyber-crime world,\" the indictment said. US Attorney Preet Bharara said \"the only liberty that Liberty Reserve gave many of its users was the freedom to commit crime.\" Customers would go to Liberty Reserve\'s now shut-down website to buy the online currency, known as LRs, that could then be used in transactions with other LR users. The system was not registered with US authorities and unlike some other non-state currency systems did not require proof of identity for users. Adding another important layer of anonymity, Liberty required customers to buy or sell their LRs via third party exchangers, meaning that there was no direct link between a customer\'s traditional bank account and Liberty\'s system. An extra service would allow a user to hide \"his own Liberty Reserve account number when transferring funds, effectively making the transfer completely untraceable, even within Liberty Reserve\'s already opaque system.\" The system, the indictment says, was tailor-made for criminal transactions and money-laundering, facilitating \"a broad range of online criminal activity, including credit card fraud, identity theft, investment fraud, computer hacking, child pornography, and narcotics trafficking.\" \"The scope of the defendants\' unlawful conduct is staggering,\" the indictment said. \"With more than 200,000 users in the United States, Liberty Reserve processed more than 12 million financial transactions annually, with a combined value of more than $1.4 billion.\" Authorities say that when Liberty Reserve realized it was under investigation it made a show of shutting down, yet continued to operate behind an array of shell companies in Australia, China, Cyprus, Hong Kong, Morocco, Russia and Spain. Budovsky and his partners started Liberty Reserve after an earlier similar venture, Gold Age Inc, which traded the E-Gold digital currency, was shut down by US authorities. It was then that Budovsky, 39, emigrated to Costa Rica, later renouncing his US citizenship, and becoming resident in The Netherlands. He was arrested in Spain. He and his four partners, who range in age from 27 to 46, face maximum prison terms of 20 years if found guilty of conspiracy to commit money laundering, as well as up to 10 years on charges related to running an unlicensed money transmitting business. Virtual currencies have grown exponentially, but face pressure on numerous fronts. The popular Bitcoin system has come under scrutiny by financial authorities and seen growing trading volatility. Acting Assistant Attorney General Mythili Raman said the United States had used \"every tool we have\" to combat \"global illicit finances.\" As Bharara put it, \"the global enforcement action we announce today is an important step towards reining in the \'Wild West\' of illicit Internet banking.\" \"As crime goes increasingly global, the long arm of the law has to get even longer, and in this case, it encircled the earth,\" he added.