Convicted of fraud for stealing 50,000 Bitcoins in September 2012 from the Silk Road black market, James Zhong was sentenced to one year in prison in the US. Several properties of the convict were also confiscated and turned over to the state. James Zhong had however pleaded guilty and cooperated with the justice system. He had even voluntarily handed over more than 1000 bitcoins to the US authorities.
James Zhong gets a year in jail for stealing more than 50,000 Bitcoins
The United States is continuing the fight against crime through crypto. On April 14, the New York City District Attorney’s office annonced the conviction of James Zhong à one year in jail for wire fraud. James Zhong is accused ofstealing 50,000 Bitcoins (BTC) on the black market Silk Road. In addition to the prison sentence, James Zhong had some of his properties confiscated.
The facts of the case against the convict date back to September 2012. At the time, James Zhong had created nine accounts on Silk Road, an online black market that operated from 2011 to 2013. Through his 9 accounts, James had managed to initiate over 140 transactions in quick succession to fool Silk Road’s withdrawal processing system. This trick had allowed James Zhong to steal about 50,000 Bitcoins (BTC) from Silk Road without being spotted.
Five years later, James Zhong Obtained 50,000 bitcoin cash (BCH) in August 2017 due to holding 50,000 Bitcoin (BTC) on Silk Road. He exchanged his 50,000 Bitcoin Cash (BCH) into 3,500 Bitcoin (BTC). So at the end of 2017, James Zhong owned a whopping 53,500 Bitcoins. He will never see these funds and other assets again.
James Zhong’s assets and funds confiscated
Despite the huge haul collected in 2017, James Zhong finds himself totally stripped and broke. Indeed, law enforcement officials seized more than 50,491 bitcoins on November 9, 2021, during a search of Zhong’s home in Gainesville, Georgia. During the same search, 661,900 US dollars and precious metal items were also seized.
James Zhong later pleaded guilty and voluntarily handed over more Bitcoins to the US authorities. In total, more than 1,004 Bitcoins have been voluntarily surrendered by Zhong since March 2022.
Despite the cooperation of James Zhong with the justice, all these seized properties were confiscated and turned over to the state. Even the 80 percent ownership of Zhong in the company RE&D Investments, LLC was not spared.
The U.S. government will also proceed with the putting up for sale of a part of the Bitcoins of Zhong. This should serve as a warning to cybercriminals, the Justice Department lawyer believes.
To all cybercriminals: we will follow the money and hold you accountable, no matter how sophisticated your scheme and no matter how long it takes.Attorney Damian Williams, attorney for the U.S. Department of Justice.
At 32 years old, James Zhong finds himself with a tainted criminal record and a critical financial situation. This is a good reminder that in the crypto industry, as in any other industry, stolen assets end up tainting those who acquire them. Fortunately, you can build a crypto investment easily and legally by applying well-tried methods.
CEO and Editor-in-Chief of Coinpri I have been navigating the waters of Blockchain for 5 years already.
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