Convicted scammer’s seized crypto moved after DOJ missed keys

Rossen Iossifov, a convicted money launderer, is accused of arranging transfers of about $290,000 in cryptocurrency in January 2024 after a court ordered the assets forfeited to the United States, according to a July 9 Justice Department filing. The filing states the transfers occurred before agents obtained practical control of the wallets’ private keys.

The Justice Department alleges the funds were routed through multiple cryptocurrency exchanges and mixing services, which the filing says prevented the government from taking possession. The filing does not identify the exchanges or mixers involved, where the crypto was held, who held the private keys at the time, or how Iossifov coordinated the transfers while in custody.

Iossifov is the owner of RG Coins, a Bulgaria-based crypto exchange. He was previously convicted for RICO conspiracy and conspiracy to commit money laundering in connection with a fraud scheme that prosecutors say used fake listings on sites such as Craigslist and eBay to victimize at least 900 U.S. buyers and convert proceeds into cryptocurrency. A 2024 court order set his original sentence at 121 months, reduced to 111 months in May 2024, and ordered $2.64 million in restitution. The new indictment charges removal of property to prevent seizure and conspiracy to commit money laundering, carrying a combined maximum sentence of 25 years if convictions are obtained.

The Justice Department filing cites a difference between legal forfeiture and technical control. A court can declare assets forfeited, but the government gains exclusive control only when all usable private keys and account credentials are out of reach. The Justice Department’s Asset Forfeiture Policy Manual instructs seizing agencies to transfer seized cryptocurrency promptly into an agency-controlled, unhosted wallet, keep it in cold storage, and then transfer it to a wallet controlled by the U.S. Marshals Service or its contractor.

The filing leaves unresolved where the chain of custody broke and whether agency personnel ever had the keys before the funds moved. The indictment frames the January transfers as deliberate attempts to prevent seizure and to launder proceeds.