DOJ says inmate moved $290,000 in crypto after 2024 forfeiture order

A U.S. Justice Department case against Rossen Iossifov centers on about $290,000 in cryptocurrency that prosecutors say was moved in January 2024 after a court had already ordered the assets forfeited to the United States. In a July 9 announcement, the DOJ said Iossifov allegedly routed the funds through multiple exchanges and illicit mixing services (tools that obscure crypto transaction trails), blocking the government from taking possession. The case underscores a practical weakness in crypto seizures: a forfeiture order or warrant may authorize the government to take assets, but control is not complete until usable private keys and account credentials are no longer accessible to anyone else. DOJ policy says agencies should immediately move seized cryptocurrency into an agency-controlled, unhosted wallet (wallet controlled directly by the holder) and then place it in cold storage (offline storage) before transfer to a wallet controlled by the U.S. Marshals Service or its contractor. Iossifov owned Bulgaria-based crypto exchange RG Coins and was previously convicted of RICO conspiracy and conspiracy to commit money laundering. Prosecutors said Romanian scammers used fake listings for vehicles and other expensive goods on Craigslist and eBay to defraud at least 900 Americans, then converted proceeds into crypto. A November 2024 court order said Iossifov received a 121-month sentence in January 2021, later reduced to 111 months in May 2024, and the DOJ said he was also ordered to pay $2.64 million in restitution. The new indictment charges him with removal of property to prevent seizure and conspiracy to commit money laundering, with a combined maximum sentence of 25 years if convicted. The filings still do not explain where the crypto was held, who controlled the keys, which services were used, or how the transfer was carried out from prison.