US Seizes $54M Crypto, Including Ethereum, In Narcotics Scheme

US Seizes $54M Crypto, Including Ethereum, In Narcotics Scheme

A recent filing showed that the U.S. Attorney’s Office is taking legal action to recover more than $54 million in cryptocurrency linked to an illegal narcotics distribution scheme. The cryptocurrency, including 30,000 Ethereum (ETH) valued at approximately $53.5 million, was previously seized and can be traced back to criminal activities. Meanwhile, the move highlights authorities’ commitment to pursuing gains obtained through illicit means, even in the realm of cryptocurrency.

U.S. Attorney Seizes Crypto Worth $54 In Narcotics Link

The U.S. Attorney’s Office, led by Philip R. Sellinger, has initiated a civil forfeiture action to reclaim cryptocurrency valued at over $54 million, which is connected to illegal narcotics distribution on the darknet, mainly in New Jersey.

Sellinger stressed that they would seize any financial gains obtained from criminal activities, regardless of whether they involve physical cash or cryptocurrencies. Notably, this action serves as a warning to those who believe cryptocurrency transactions can shield their illicit behavior from law enforcement.

Meanwhile, the scheme involved Christopher Castelluzzo and his associates, who conspired to sell narcotics between 2010 and 2015. Notably, they expanded their operations to the darknet around 2013, accepting Bitcoin for their illegal goods.

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A Multi-Agency Effort for Justice

The filing showed that Castelluzzo used Bitcoin earnings to acquire 30,000 ether during Ethereum’s initial coin offering (ICO) in 2014, alongside 30,000 Ethereum Classic in 2016. Notably, the cryptocurrency obtained through these illicit means is now subject to forfeiture.

Castelluzzo, currently serving a 20-year sentence for drug distribution convictions, had hatched plans to evade taxes and move the 30,000 ether overseas while in prison. However, U.S. authorities uncovered these plans from recorded prison telephone calls in 2021 and seized the cryptocurrency linked to his drug trafficking.

Meanwhile, this forfeiture action is the result of a collaborative effort between several agencies, including the FBI’s Virtual Assets Unit, Homeland Security Investigations, and local law enforcement. It sends a strong message that the law enforcement community can successfully trace and apprehend criminals who attempt to use cryptocurrencies for illegal activities.

As the case unfolds, it underscores the importance of compliance and accountability within the cryptocurrency space and demonstrates the government’s determination to bring criminals to justice even in the crypto realm.

Also Read: US SEC Likely To Approve Spot Bitcoin ETF In November, Says Valkyrie CIO Steven McClurg

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