U.S. Sells 500 Seized Bitcoins From 2018 for $19 Million

Fazzaco learned that federal authorities in the U.S. state of Ohio have sold bitcoins seized back in 2018 in a fraud case. As the largest net forfeiture in the Northern District of Ohio's history, the seized bitcoins were initially valued at approximately $2.88 million while were recently sold for nearly $19.23 million. But the authorities did not say how and where the coins were sold.

The fraud case where the coins were seized involved a 37-year-old Toledo-area man, Mark Alex Simon, who made false identification documents for residents of Ohio, Michigan and Utah. The documents included driver's licenses and personal identification cards. He was paid in bitcoin.

 In 2015, the authorities traced fake identification cards found at a bar near Wittenberg University back to a website Simon built. After months of investigation, the police was able to link the fake cards to Simon and others working with him. The authorities raided Simon's home in Toledo along with the homes of others linked to the case. They seized more than 500 bitcoins from Simon through forfeiture proceedings.

Simon pleaded guilty to conspiracy to launder money and the transfer of false identification documents in June 2019. He was sentenced to two years in prison. 

In US forfeiture cases, the proceeds are shared between federal agencies and local police departments involved in the investigation, as well as used to compensate any crime victims. Any remaining money is returned to the U.S. Treasury.