Bitcoin

Bitcoin Daily: Gemcoin Founder Pleads Guilty In $147M Fraud Case; Dubliner Forfeits $67.6M In Bitcoin As Part Of Drug Case

Bitcoin daily

Steve Chen, the mastermind behind a $147 million gemcoin fraud from 2013 to 2015, pleaded guilty of his crimes of tax evasion and conspiracy to commit wire fraud, reported on Wednesday (Feb. 19). The 62-year-old California resident will face a minimum of a decade in prison, according to the Department of Justice.

As part of his plea agreement, Chen admitted to operating the U.S. Fine Investment Arts (USFIA), and promoting his gemcoin currency, which was based on nonexistent gemstones. The scheme was a multilevel marketing (MLM) operation that went on for two years, and managed to scam 70,000 victims for a total of $147 million.

In other crime-related crypto news, a drug dealer has lost millions in cryptocurrency after a judge ruled that it was the proceeds of criminal activity. Dublin-based 49-year-old Clifton Collins was ordered to give up €52 million (more than $56 million USD) in bitcoin by Justice Alex Owens when the Criminal Assets Bureau (CAB) determined that he had been involved in the supply and sale of drugs. Collins did not contest the CAB's ruling.

The case stemmed from a February 2017 garda investigation, in which Collins had been stopped by law enforcement while driving a vehicle on the Sally Gap in the Wicklow Mountains. He was found to be carrying some amount of marijuana. The garda then searched his residence in Farnaught, Corr na Móna, finding a large amount of marijuana plants growing there.

Collins was charged with numerous crimes under the Misuse of Drugs Act. He appeared before the Bray District Court. According to the court, Collins potentially began investing in bitcoin at an early stage, increasing his value over time.

The bitcoin seized was part of the value of assets confiscated last year. The CAB put a freeze order on his crypto funds to make sure he couldn't remove it from his wallet without the court's approval.

Crime is not a new issue with cryptocurrency, as fraudsters — and even terrorists — find ways to utilize the new form of currency as the world tries to catch up.

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