Nobody has said it is not a privacy tool. It is a privacy tool that has documented use in money laundering. Building tools is generally legal, using them to commit crimes is something different. The developer here is not accused of building privacy tools, they are accused of knowingly being in on the money laundering and profiting from it.
It's not clear from their vague, weasely language whether they're accusing him of any involvement beyond building the privacy tool. If they had any evidence of that, presumably they would have said so.
> suspected of involvement in concealing criminal financial flows and facilitating money laundering
Of course; what I'm suggesting is that they would have simply used less ambiguous language like "working with" or "providing support to". Their weasely language suggests that they need plausible deniability because their insinuations may turn out to be baseless.
The local mob-owned laundromat is also a privacy tool. Both are meant to hide the provenance of money from others. What's the difference besides the implementation details?
The difference is that one provides privacy exclusively to money launderers, while the other is a generic tool which anyone can use to obtain financial privacy.