U.S. DOJ charges federal inmate over alleged transfer of forfeited cryptocurrency

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DOJ charges inmate over crypto

Highlights

Iossifov faces new DOJ charges in Kentucky for allegedly transferring forfeited cryptocurrency through multiple exchanges in January 2024 to evade government seizure.
His 2021 conviction involved laundering nearly $5 million in cryptocurrency and a court order to pay $2,642,297.43 in victim restitution.
The case heightens scrutiny on the custody and tracing of forfeited digital assets, as Iossifov faces up to 25 years in prison if convicted.

Kentucky case details and alleged asset transfers

According to The Block, the U.S. Department of Justice said in a statement on Thursday that Rossen G. Iossifov, a 53-year-old Bulgarian national, appears in federal court in the Eastern District of Kentucky earlier this week on charges of removal of property to prevent seizure, aiding and abetting, and conspiracy to commit money laundering.

Prosecutors allege Iossifov conspires to transfer the cryptocurrency in January 2024, nearly three years after his 2021 conviction in the same district. The DOJ says he moves the assets through multiple cryptocurrency exchanges and illicit mixing services in an effort to prevent the U.S. government from taking possession of funds that had already been seized and forfeited.

Assistant Attorney General A. Tysen Duva of the Justice Department's Criminal Division says Iossifov is charged with moving cryptocurrency obtained from the earlier crime in violation of a court forfeiture order.

Links to prior fraud case and enforcement impact

Iossifov's 2021 conviction stems from his role in an online auction fraud scheme that launders nearly $5 million in cryptocurrency in less than three years, according to prosecutors. That case also results in a court order requiring him to pay $2,642,297.43 in victim restitution alongside the asset forfeiture.

The new case adds to enforcement scrutiny around the custody and tracing of digital assets tied to criminal proceedings, particularly when forfeited cryptocurrency is allegedly rerouted through exchanges and mixing services. If convicted on the latest charges, Iossifov faces a maximum sentence of 25 years in prison.

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