The U.S. Department of Justice has charged an incarcerated Bulgarian national, Rossen G. Iossifov, for allegedly siphoning roughly $290,000 in cryptocurrency that had been ordered forfeited to the government.
Key allegations and timeline
- DOJ says Iossifov conspired in January 2024 to transfer crypto assets that a court had already forfeited following his earlier conviction.
- He is charged in the Eastern District of Kentucky with removing property to prevent seizure, aiding and abetting, and conspiracy to commit money laundering.
- At the time of the alleged transfers, the 53-year-old was serving a 111-month federal sentence tied to a 2021 conviction.
How prosecutors say it happened
- According to the DOJ, Iossifov moved the funds through multiple cryptocurrency exchanges and “illicit mixing services” — services that pool and redistribute coins to obscure transaction trails.
- Prosecutors claim those transfers prevented the U.S. government from taking possession of the assets. The DOJ has not named the exchanges or mixers allegedly used, nor explained how the transfers were directed from custody.
Background: prior conviction and fraud scheme
- The new case stems from assets connected to Iossifov’s 2021 conviction. Evidence at trial showed he laundered nearly $5 million in cryptocurrency over a roughly three-year period.
- Iossifov owned RG Coins, a Bulgaria-based Bitcoin exchange prosecutors say catered to an online auction fraud network that targeted U.S. buyers with fake vehicle and goods listings. Victims paid for items that didn’t exist, and proceeds were moved through bank accounts and crypto services.
- A court ordered him to pay $2,642,297.43 in restitution and to forfeit the cryptocurrency now at the center of the current indictment. His conviction and sentence were later upheld on appeal.
Enforcement context and operational hurdles
- The case underscores a practical challenge for law enforcement: a forfeiture order does not automatically give the government control of digital assets. Authorities must locate and secure wallets, private keys and account access before funds can be moved.
- DOJ officials point to larger enforcement efforts: in January the department finalized forfeiture of more than $400 million tied to the Helix crypto mixer, which had processed over 354,000 Bitcoin while serving darknet markets and other users. The agency has also pursued other recoveries (e.g., DOJ action seeking forfeiture of $2.3 million in Bitcoin linked to the Chaos ransomware group after recovering a wallet seed phrase).
Legal consequences and process
- If convicted on the current charges, Iossifov faces up to a combined 25 years in prison; any sentence will be determined by the court after considering federal guidelines.
- Assistant Attorney General A. Tysen Duva said Iossifov is accused of moving cryptocurrency obtained through the earlier fraud “in violation of a court’s forfeiture order,” and emphasized that the DOJ will pursue defendants who ignore such orders. The Secret Service investigated this matter, with support from the DOJ’s Office of International Affairs.
Procedural notes
- The indictment contains allegations and is not proof of guilt. Iossifov is presumed innocent until proven guilty. The case will proceed in the Eastern District of Kentucky, with Senior Counsel Vasantha Rao and Assistant U.S. Attorney Kathryn M. Dieruf prosecuting.
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