More Than $1.7 Million In Forfeited Funds Presented To Law Enforcement Agencies
Jacksonville- FL - United States Attorney Maria Chapa Lopez, along with Special Agent in Charge James Spero, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), announce today the distribution of more than $1.7 million in civilly forfeited funds to three law enforcement agencies. These awards are the result of a federal civil forfeiture of more than $4.5 million in funds obtained fraudulently through the hacking of bitcoin accounts. Pursuant to the Department of Treasury Equitable Sharing Program, the funds were distributed to the Nassau County Sheriff’s ($1,044,550.05); the Florida National Guard ($627,487.74); and the Jacksonville Sheriff’s Office ($209,162.58). The presentations took place today at the Jacksonville Office of Homeland Security Investigations.
“I applaud the cooperation and diligence of our law enforcement partners in working with us to investigate and prosecute this case successfully,” said U.S. Attorney Chapa Lopez. “Divesting criminals of their ill-gotten gains and returning these resources to our enforcement agencies is yet another step in continuing our fight against crime.”
“This asset sharing is a perfect example of how a criminal’s illegal profits can be used to protect the citizens of our communities,” said Special Agent in Charge Spero. “The Nassau County Sheriff’s Office, the Florida National Guard’s Counterdrug Program and the Jacksonville Sheriff’s Office all worked with HSI to hold these criminals accountable and we are honored to be able to publically recognize them for their hard work, while sharing with them a large portion of the seized monies.”
According to court documents, in November 2013, HSI special agents learned of the theft of approximately 5,400 bitcoins from Sheep Marketplace, an illicit online marketplace that has since been shut down. Sheep Marketplace was used predominantly for the illicit sale of narcotics. Jacksonville residents Sean Mackert and Nathan Gibson determined that the Sheep Marketplace had a single online “wallet” that contained the bitcoins earned by individuals using the marketplace. They devised a scheme that tricked Sheep Marketplace’s “wallet” into transferring the bitcoins of others into “wallets” they controlled. During their investigation, HSI agents determined that Mackert and Gibson had routed the bitcoins through multiple online “wallets,” then wired them to a licensed money service business. At their direction, the money service business exchanged the bitcoins for United States currency, then wired the funds to bank accounts in Jacksonville that were controlled by Mackert and Gibson.
Mackert and Gibson both have pleaded guilty to conspiracy to commit wire fraud and are awaiting sentencing. Each faces up to 20 years in federal prison.
During the criminal investigation, HSI agents and local law enforcement, with the assistance of the United States Attorney’s Office, seized the funds and two vehicles. The United States commenced a civil forfeiture action against the funds, alleging that they were the proceeds of fraud. The district court ultimately ordered the forfeiture of the funds and two vehicles.
In the Middle District of Florida, enforcement of federal asset forfeiture laws is an integral part of our law enforcement mission. Taking the profit out of crime is important in disrupting and dismantling illegal enterprises, deterring crime, and restoring property to victims. It is also an effective way to have criminals help fund law enforcement efforts. Through the Equitable Sharing Program, our state and local law enforcement partners receive resources to supplement their law enforcement mission. Asset forfeiture and equitable sharing are valuable law enforcement tools that send a clear message that crime does not pay.
The case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations with assistance from the Nassau County Sheriff’s Office, the Florida National Guard, and the Jacksonville Sheriff’s Office. The civil forfeiture action was handed by Assistant United States Attorney Bonnie Glober. The criminal prosecution is being handled by Assistant United States Attorney Kevin Frein.