From the document, it doesn't look like this was from simple face to face transactions using localbitcoins... it looks like he was somehow involved with running an exchange.
Unfortunately I think the gov sees face to face transactions using localbitcoins as "running an exchange".
Even the LBC site gives you tips on how to
"run a bitcoin cash exchange for fun and profit".It is a shame that he faces time in prison for allegedly doing something so harmless.