So, been trying to understand how cloak works from the little snippet of info that's been released.

As coins are passed from sender--->Phase 1-->Phase 2-->Recipient, the last point before it gets to the recipient is from the phase 2 node - if the coin is used in an illegal transaction, the owner of the phase 2 node will be the last point tracked and hence be liable & potentially responsible.

I for one would not want to have the fbi at my door just because I left my wallet open and unknowingly participated in a transaction that funded the bad guys.

Please, can someone post if this is a valid flaw.