In operation from approximately 2011 until 2013, Silk Road was used by numerous drug dealers and other unlawful vendors to distribute massive quantities of illegal drugs and other illicit goods and services to many buyers and to launder all funds passing through it. Silk Road was an online "darknet" black market. We will continue to work with our partners at the US Attorney's Office to track down these criminals and bring them to justice."Īccording to the allegations contained in filings in Manhattan federal court and statements made during court proceedings: Zhong's Scheme to Defraud
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Once he was successful in his heist, he attempted to hide his spoils through a series of complex transactions which he hoped would be enhanced as he hid behind the mystery of the 'darknet.' IRS-CI Special Agents are the best in the world at following the money through cyberspace or wherever our financial investigations lead us. Zhong executed a sophisticated scheme designed to steal bitcoin from the notorious Silk Road Marketplace. IRS-CI Special Agent in Charge Tyler Hatcher said: "Mr. This case shows that we won't stop following the money, no matter how expertly hidden, even to a circuit board in the bottom of a popcorn tin." Thanks to state-of-the-art cryptocurrency tracing and good old-fashioned police work, law enforcement located and recovered this impressive cache of crime proceeds. For almost ten years, the whereabouts of this massive chunk of missing Bitcoin had ballooned into an over $3.3 billion mystery. Attorney Damian Williams said: "James Zhong committed wire fraud over a decade ago when he stole approximately 50,000 Bitcoin from Silk Road. The Government is seeking to forfeit, collectively: approximately 51,680.32473733 Bitcoin ZHONG's 80% interest in RE&D Investments, LLC, a Memphis-based company with substantial real estate holdings $661,900 in cash seized from ZHONG's home and various metals also seized from ZHONG's home. Department of Justice and today remains the Department's second largest financial seizure ever. This seizure was then the largest cryptocurrency seizure in the history of the U.S. On November 9, 2021, pursuant to a judicially authorized premises search warrant of Zhong's Gainesville, Georgia, house, law enforcement seized approximately 50,676.17851897 Bitcoin, then valued at over $3.36 billion. Zhong pled guilty on Friday, November 4, 2022, before United States District Judge Paul G. Contact: November 2021, Law Enforcement Seized Over 50,676 Bitcoin Hidden in Devices in Defendant James Zhong's Home Zhong Has Now Pled Guilty to Unlawfully Obtaining that Bitcoin From the Silk Road Dark Web in 2012 Damian Williams, the United States Attorney for the Southern District of New York, and Tyler Hatcher, the Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, Los Angeles Field Office ("IRS-CI"), announced today that James Zhong pled guilty to committing wire fraud in September 2012 when he unlawfully obtained over 50,000 Bitcoin from the Silk Road dark web internet marketplace.
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