Slashdot Mirror
Feds Moving Quickly To Cash in on Seized Bitcoin, Now Worth $8.4 Million (arstechnica.com)
A federal judge in Utah has agreed to let the US government sell off a seized cache of over 513 bitcoins (BTC) and 512 Bitcoin Cash (BCH). At current prices, that would yield approximately $8.4 million for the bitcoins and nearly $1 million for the BCH. From a report: In a court filing, prosecutors noted that due to the volatility of the Bitcoin market, both coins risk losing value. Both the BTC and the BCH have already been transferred to government-controlled wallets. The new round of seized digital currency belonged to a Utah man named Aaron Shamo, whom prosecutors say led a multimillion-dollar ring of counterfeit pharmaceuticals, including oxycodone and alprazolam that were sold on Dark Web marketplaces. Shamo was arrested over a year ago -- his trial has not yet been scheduled. On Tuesday, US District Judge Dale Kimball allowed the sale to proceed. Once sold, the money would go to an account held at the Treasury Executive Office for Asset Forfeiture.
America, land of the free, and you have RIGHTS... HA HA HA! Meanwhile we will steal your stuff and sell it, putting it into the government's pockets, before you are even convicted of the crime. What good do your guns do you now to defend against tyranny?
The same way Jesusanta is "real", yes?
You couldn't buy jack shit from me for all the imaginary money in the world.
(In an ideal world, I only take things that are an actual proof of work. And no, wasting GPU cycles does not count. Neither does banking, management, reselling, copyright, theft, robbery, etc, even if you worked to avoid working.)
.. that government servants are able to cash in on their seizures like they earned the money. It should rightfully be destroyed, or returned directly to taxpayers via a refundable credit.
A government is a body of people notably ungoverned - AC
No trial, but selling off his assets already?
They're going to sell off seized assets before the trial has even been scheduled? What if the value goes up and he's acquitted? Will taxpayers be on the hook for the difference when he goes to collect his property?
Translation: BTC is near it's peak and they want to cash in on this seized coin before the bubble pops to make the most money they can! Expect the sale to cause BTC to fluctuate a "bit" if not a lot due to the sale. I'm sure the sale of this seized BTC will go directly to the poor hardworking taxpayers and not to line the pockets of greedy officials. It's so nice to see that they are working to make as much money as they can for the taxpayers! Uh huh!
"Feds Cash In BitCoin." A title like that, carried by enough outlets, just might ignite the "correction".
damaged by dogma
"Shamo was arrested over a year ago -- his trial has not yet been scheduled."
I'm glad the Framers added the right to speedy sale of BTC, but they could have also added one for trials.
It makes sense that they'd try to convert this particular seized asset to cash ASAP. It's not mansions, paintings and a fleet of luxury cars...it's a highly volatile cryptocurrency. Turn it into cash, hold onto it until the trial and appeals are over, and you still have an asset worth something. If they wait and the bubble pops, they get nothing or a fraction of what they would get had they sold.
Remember when they sold the 700,000 BTC they seized from silk road for $13m? Good times...
- In Soviet Korea, only old people loose all their bases to Natalie Portman's petrified hot grits overlords.
FUCK THE POLICE!
proven innocent, in which case they have violated his 4th amendment rights to be secure in his person and possessions from unlawful search and seizure, which this is, and the sale of said assets before he was proven guilty in a court of law.
America is truly run by the sort of highwaymen we once associated with British legal proceedings.
Bet they'll be able to throw a real nice party for themselves after this score. Buy the good booze and the high-end sex workers. No worries about drugs, they'll just get that from the evidence lockers.
Sometimes they're thawed and a nice big meal is had.
How could they liquidate it? What criminal doesn't store BTC in an encrypted wallet and forget that really long password.
The government sells the assets that were obtained by selling contraband. So it is actually like the government just sold a bunch of drugs. I guess that's nothing new, its just that I thought the CIA was the only government agency in the business of selling illegal drugs in the US.
The guy hasn't had his trial yet.
What they should do is hold onto the seized assets. Return them to him if he is found not guilty, do what the law allows if he is found guilty.
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
...after a thirty-day delay due to high Bitcoin network fees.
#DeleteFacebook
I can't say why this pops into my head while reading this article, but I am reminded of how the history of the federal bureaucracy includes times where they managed brothels in Nevada as an ongoing business after seizing them as part of tax enforcement action.
I guess it is because for some reason it doesn't seem that the Feds have any business trading Bitcoins either.
These civil forfeiture cases usually involve a suit against the anonymous assets, so most likely somewhere on some docket is "The United States vs some very long number".
JESUS H FUCKING CHRIST ON A POGOSTICK YOU'VE ALL GONE GODDAMNED INSANE.
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
You can’t seize bitcoin. That’s the whole point of it.
They should cap the payout to $2,500/week like the rest of us shmos. This large of a cashout can bankrupt an exchange.
The govt may have a right to sequester the asset, but for BTC all that means is moving it to a wallet the bad guy can't access.
Liquidating the position before there is a trial seems unjustified.
What if bitcoin keeps going up, and he is found innocent after the feds sold off the coin? Could he sue them for lost gains?
A market order of that size (which is relatively small) will drop the price around 5%, that should put things in perspective for people but it won't.
Good thing this person: https://pineapplefund.org/ is altruistic because if they unloaded all of their bitcoin in a market order he would drop the price around 60%.
People are going to get crushed when the bottom fall out of this thing. It's not going to be pretty.
The problem with this rationale is that it is the Prosecution who asserts that this is probably ill-gotten wealth, often using the successful acquisition of an indictment as proof of probable cause for seizure. Once they get a judge to agree, assets are seized.
In the US justice system, money improves outcomes for defendants. Now the defendant cannot use those assets to pay for a defense. This is fine if the assets ARE proceeds of crime, but what about when they aren't?
The defendant has not yet been proven guilty (although the odds of a conviction just went through the roof). What happened to "Innocent until..."? This specific case may look like an OK outcome, but this becomes a precedent for future cases where the defendants are more sympathetic and/or the guilt more uncertain. (This is how we wound up with lifetime criminal registries being possible - they first used them on pedophiles.)
Sadly, some appellate courts have explicitly ruled that the government 'has the right to deny defendants the means to pay for their defense.'
Do they even know how to use BTC? Why would this guy willingly give up the private key? He probably didnt and they think that b/c they have him they have his cash.
Typically, the organization that did the seizing gets to keep it. This motivates a lot of the roadside vehicle searches by sheriff's deputies and highway patrol officers. These guys often seize cash in the $5,000 - $10,000 range. This money stays in their local department, and because it is not from a budget line-item, they are generally allowed to spend it on whatever they want, like espresso machines and video-game consoles for the break room. The former owners of this money will struggle to get it back, even if it's completely legit. Note that there is no requirement of a criminal charge for them to seize this, they just have to find it.
At the Federal level, things get more complex. It seems like they have a dedicated office for processing seizures, but it's probably because so many of their seizures are gigantic.
The government sells the assets that were obtained by selling contraband. So it is actually like the government just sold a bunch of drugs.
No, somebody sold contraband, and the government collected taxes & fines.
Utah (the state in TFA) requires "dealers in possession of a controlled substance must purchase and affix drug tax stamps to the controlled substance."
There's literally a law requiring drug dealers to buy stamps from the state, and attach the stamps onto every packet of drugs sold.
As with most taxes, there are severe penalties for noncompliance.
-- Sometimes you have to turn the lights off in order to see.
Selling his 513 bitcoins? Isn't that like 8.4 million in dollars? Shouldn't they hold onto the 7.6 million instead? I mean, what happens if that 9.3 million in bitcoin is liquidated and the man is innocent? They'll have a hard time paying back that 6.7 million.
And I almost bought the house across the street from him. No, he didn't share. Rude.
" ...his trial has not yet been scheduled. "
Soooo... what happens if he is never convicted, and the government has to return his assets? They no longer have the bitcoins, and if the price doubles between now and then, they would be out millions of dollars to repurchase them to return. And if they say, "Here is the original money we made of the bitcoins", he could rightly argue in court that he was not returned what was taken.
Wow, you could really fuck somebody over by posting links like that. Amazon has guidelines about how affiliate links can and can't be promoted, and they've been known to close accounts for violators that get reported,
we're talking BILLIONS OF DOLLARS worth.
"fuck the constitution, we're gonna fund our own black ops"
Hope he's found innocent, and the gubment has to return his btc. After they've skyrocketed another 100 times...
The sound of the feds popping the bubble.
Show them the middle finger and block their transactions until the verdict (or a crash).
It'll be something dumb like this that sets of the big sell-off and crypto-crash.
Bob Stein, http://bobste.in