• James Zhong was sentenced to a year in prison after defrauding Silk Road into sending him 50,000 BTC.
• He set up 9 accounts and initiated 140 transactions to deceive the DNM’s withdrawal mechanism.
• Federal officials seized over 51,351.89785803 bitcoin from Zhong, along with $661,900 in cash and other assets.
U.S Court Sentences Bitcoin Hacker
A U.S District Judge Paul G. Gardephe has sentenced James Zhong to a year in prison for hacking the digital currency platform Silk Road and stealing 50,000 Bitcoin (BTC). The New York Department of Justice revealed that he had set up nine different accounts and initiated 140 separate transactions in order to fraudulently acquire the funds.
Government Plans to Sell Seized Bitcoin
The government plans on selling 41,000 seized bitcoins this calendar year and sold 9,861.1707894 BTC on March 14th 2023 in an attempt to recuperate some money from the crime committed by Zhong. In addition, he also earned 50,000 Bitcoin Cash (BCH) when Bitcoin split back in August 2017; these were traded on an international cryptocurrency market for 3,500 BTC as well.
Law Enforcement Uncovers Hidden Safe at Home
Law enforcement uncovered a hidden safe at Zhong’s home in Gainesville Georgia which contained over 51,351.89785803 bitcoins along with other assets such as precious metals and $661,900 in cash which were subsequently seized by federal officials.. As part of his sentence 80% of RE&D Investments Memphis company with major real estate assets was also taken away from him by authorities for compensating the losses made by his hack.
Government Agencies Involved
Several government agencies such as New York Department of Justice , Internal Revenue Service (IRS), Los Angeles Field Office of IRS Criminal Investigation Division’s Western Cyber Crimes Unit and Athens-Clarke County Police Department were all involved in bringing down James Zhong who eventually plead guilty to wire fraud charges brought against him due to this incident..
To conclude it can be said that no legitimate purchases were ever made using these fake accounts created by James which only lead him down a path towards jail time now that he has been sentenced accordingly for his actions related to this case of wire fraud involving Silk Road’s Digital Currency Platform