A recent event saw the seizure of $54 million worth of Ethereum (ETH) from convicted drug dealer Christopher Castelluzzo in Lake Hopatcong, New Jersey by US officials lead by US Attorney Philip R. Sellinger.
The United States Attorney for the District of New Jersey filed a civil forfeiture lawsuit to reclaim crypto that had been seized as the result of an illicit drugs distribution operation.
“Today we’re filing a civil suit to get back millions of dollars in cryptocurrencies the defendant made off of illegal narcotics transactions. We will take whatever action is required to recover any ill-gotten funds, whether they in the form of simple bags of cash or complex cryptocurrencies.”
Criminals on the dark web have been exploiting cryptocurrencies like Bitcoin (BTC) and Ethereum to hide their tracks, according to a news release issued by the United States Department of Justice (DOJ).
FBI Newark Field Office Special Agent in Charge James E. Dennehy said the agency played an essential part in identifying the criminal activity and ill-gotten gains.
According to the evidence presented in court and the results of the investigations, Christopher Castelluzzo and his friends plotted to distribute drugs between 2010 and 2015.
They reportedly started selling narcotics on dark web marketplaces for Bitcoin in 2013. Castelluzzo bought 30,000 Ethereum in the Ethereum Initial Coin Offering (ICO) in July 2014 using money he made from drugs. Castelluzzo also benefited in 2016 with a donation of 30,000 ETH Classic.
It was disclosed in the forfeiture records that Castelluzzo intended to transfer the money to a tax haven in Ireland, Malta, or the Bahamas, or maybe retain it in USDT (Tether).
But a search order issued later led to the raid of Castelluzzo colleague Brian Krewson’s home. After getting the passwords to the cryptocurrency wallets under Krewson’s control, police enforcement was able to successfully seize the Ethereum, which was worth $31 million at the time.
Castelluzzo, who is spending a combined 20 years in federal and state jail for narcotics dealing, tried to avoid paying taxes and send the 30,000 Ether abroad from behind bars.
Unfortunately, Castelluzzo’s attempts to conceal his bitcoin laundering were uncovered via his recorded jail phone conversations. The United States government then stepped in and confiscated the crypto assets Castelluzzo had amassed as a consequence of his drug trafficking activities.
The 30,000 Ethereum are now worth almost $54 million, highlighting the massive effect of the confiscation.
There is significant positive momentum in the market as ETH is now trading at $1,815, showing a 0.9% rise over the previous 24 hours and a continuous upward trend of over 2% in the past seven days.
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