A Canadian man has been sentenced to 41 months in federal prison for attempting to launder 450 Bitcoin—now worth over$ 43 million —after his 2020 conviction for running an unlicensed money-transmitting business.
Firoz Patel, 50, of Montreal, pleaded guilty to blockage of an established moving after he was caught laundering crypto revenues rather of complying with a court-ordered forfeit, the U. S. Department of Justice announced Thursday.
U. S. District Court Judge Dabney L. Friedrich handed down the sentence, including three years of supervised release, forfeiture of 450 Bitcoin ( plus any accrued interest ) currently frozen at a crypto exchange in the U. K., and a$ 24 million forfeiture judgment.
Patel, who previously ran Payza, an unlicensed online payment service, had already been found guilty in 2020 of executing illegal transactions related to money laundering and Ponzi schemes.
As part of his 36-month punishment, Patel was required to disclose and sacrifice all property tied to his acts.
Instead, he misled the court, claiming his finances were limited to$ 30, 000 in retirement savings, when in reality, he was sitting on a Bitcoin fortune.
In an effort to keep the funds out of the president’s reach, Patel switched the money between crypto exchanges.
Second, he funneled the Bitcoin into Binance, but the system flagged and shut down his profile in April 2021, citing conformity transgressions.
Patel therefore transferred the stockpile to an offshore trade by linking it to a Belize-based tackle used for Payza by using an account in his family’s name. That change even froze the money, recognizing the deal as cautious.
Patel, growing exceedingly hungry, contacted the change in June 2021 and insisted he owed nothing to the U. S. state.
However, authorities had now taken steps to acquire the property, working with government in the U. K. to ensure the stockpile remained frozen.
Patel made an effort to reclaim control of the frozen blockchain even while he was behind bars.
As he neared his discharge date, he orchestrated a constitutional charade—recruiting an associate to represent as an attorney and participate in scam negotiations with the U. S. Attorney’s Office.
The purpose? Hold the situation long enough to escape to Canada before facing fresh costs.
Authorities saw through the fraud, leading to Patel’s prosecution in May 2023.
Since June 2021, he has been in federal custody, with the United States ensuring that his Bitcoin kingdom is never-accessible.
The situation of Patel serves as an illustration of how scammers continue to seize digital assets to conceal illegal money.
The crypto industry faced$ 3 billion in losses due to hacks and scams in 2024, a 15 % increase from the previous year, as per blockchain security firm PeckShield’s report.
Hacks alone accounted for$ 2.15 billion, marking a 42 % surge compared to 2023, while scams contributed$ 834.5 million in losses.
Just last week, another Canadian national, 22-year-old Andean Medjedovic, was indicted for allegedly exploiting vulnerabilities in two decentralized finance ( DeFi ) protocols to steal$ 65 million from investors.
Daily Debrief Newsletter
Start every day with the best news stories right now, plus unique characteristics, a audio, video and more.
