Illinois Federal Court Orders Forfeiture of Cryptocurrency Linked to Criminal Activity

News | July 8, 2024 By:

On Friday, June 21, 2024, the US District Court for the Southern District of Illinois ordered the forfeiture of cryptocurrency seized from a Binance exchange account to the United States government.

According to court documents, the United States filed a civil forfeiture complaint on February 15, 2024, seeking to forfeit cryptocurrency that was seized from Binance User ID 36076314 by the United States Secret Service on December 28, 2023. The complaint alleged that the cryptocurrency was subject to forfeiture because it constituted or was derived from proceeds traceable to wire fraud and money laundering offenses in violation of federal law.

Under federal civil forfeiture law, any property involved in or traceable to criminal offenses can be subject to forfeiture by the government.

After the cryptocurrency was seized, the government published notice of the forfeiture action on the official government forfeiture website for over 30 days beginning in early April, as required by law. This was done to notify any potential claimants of the forfeiture case.

When no one filed a claim to the cryptocurrency by the deadline, the Clerk of the Court entered a default against all potential interested parties on June 13, indicating none had responded to assert ownership. The government then filed a motion asking the court to order the forfeiture.

In his order, District Judge J. Phil Gilbert granted the forfeiture motion, finding that the cryptocurrency was subject to forfeiture based on the allegations in the complaint since no party had stepped forward to contest the forfeiture or assert a valid claim to the digital currency.

The judge’s order formally forfeited the seized cryptocurrency to the United States and clarified that no other individual or entity would have any legal right, title, or interest in the funds going forward. The order also directed the United States Secret Service to handle the cryptocurrency as the property custodian agency.

With this ruling, the government has gained clear legal ownership of the cryptocurrency funds and can now liquidate and deposit the proceeds into the United States Department of Justice’s asset forfeiture fund to support law enforcement initiatives.

Please contact BlockTribune for access to a copy of this filing.