In recent developments, US authorities led by US Attorney Philip R. Sellinger successfully seized $54 million worth of ethereum (eth) from Christopher Castelluzzo, a convicted drug dealer operating out of Lake Hopatcong, New Jersey.
Massive crypto explosion
The United States Attorney’s Office filed a civil forfeiture action to recover previously seized cryptocurrency He was determined to be the product of an illegal narcotics distribution scheme operating in and around New Jersey.
U.S. Attorney Philip R. Sellinger emphasized authorities’ “commitment” to seizing the financial gains of criminal activity, regardless of the form they take. The seller further stated:
The civil action we are taking today seeks to recover millions of dollars in cryptocurrency, which the defendant allegedly obtained from the sale of drugs. Whether it is as simple as bags of cash or as sophisticated as cryptocurrency, we will take necessary steps to seize the financial gains defendants make from criminal activity.
According to the US Department of Justice (DOJ) Press release In the case, the prosecution sheds light on the use of cryptocurrencies as bitcoin (btc) and ethereum by criminals in the darknet to evade detection.
Additionally, James E. Dennehy, special agent in charge of the Federal Bureau of Investigation (FBI) in Newark, stated that the FBI played a critical role in uncovering the illegal conduct and ill-gotten gains.
Drug trafficker’s ethereum stash seized
According to court documents and investigations, Christopher Castelluzzo and his associates conspired to sell narcotics between 2010 and 2015.
In 2013, they allegedly began trading drugs on darknet platforms in exchange for bitcoin. Castelluzzo, using proceeds from the sale of narcotics, participated in ethereum Initial coin offering (ICO) in July 2014, acquiring 30,000 ethereum. In addition, Castelluzzo received 30,000 Classic eth in 2016.
Castelluzzo’s plan to move the funds to a tax haven in Ireland, Malta or the Bahamas, or potentially hold them in USDT (Tether), was revealed in seizure documents.
However, a subsequent search warrant led to the search of the residence of Brian Krewson, an associate of Castelluzzo. Police discovered the relevant crypto wallets under Krewson’s control and, after obtaining the necessary passwords, law enforcement executed the seizure of the ethereum, valued at $31 million at the time.
Castelluzzo, who is currently serving concurrent 20-year federal and state prison sentences for drug distribution convictions, attempted to evade taxes and transfer the 30,000 ethereum out of the United States while incarcerated.
However, Castelluzzo’s plans were intercepted when recorded prison phone calls exposed his efforts to launder cryptocurrency. As a result, the United States intervened and confiscated Castelluzzo’s cryptocurrency holdings linked to his drug trafficking crimes.
The current value of the 30,000 ethereum amounts to approximately $54 million, underscoring the significant impact of the seizure.
At the time of writing, eth is trading at $1,815, reflecting a 0.9% rise over the past 24 hours and a consistent uptrend of over 2% over the past seven days, showing strong bullish momentum. in the market.
Featured image from Shutterstock, chart from TradingView.com
