Lancashire police have won around $665,000 (£500,000) after Bitcoin seized in a major fraud case surged well beyond the amount stolen.
Officers confiscated Bitcoin from criminals who converted stolen funds. A significant price increase led to the financial results exceeding the original losses when police recovered the assets.
The surge in Bitcoin’s value creates an unexpected storm
The investigation began in December 2017 when police received reports of funds stolen from victims of fraud. Enquiries revealed that the perpetrator converted the stolen funds into Bitcoin, and the value increased over time.
As a result, police held assets that were far more valuable than the original stolen amount and presented rare surplus to be allocated. The surplus was divided between the police and the Home Office, as required by British law.
According to Lancashire Police, the freezing tools made possible by the Crime Proceeds Act allowed officers to secure crypto assets. The court then granted compensation to the victim, who was equivalent to the actual loss. However, UK law limits additional compensation if assets are significantly valued.
“It’s rare that criminal property has more value than the original crime, but this has allowed us to fully compensate the victims as they can afford to use it to reduce the crime.”
In summary, only the amount originally stolen will return to the victim. Police will secure half of the additional wind drops, leading it to a wider community and crime prevention effort.
Such cases are becoming more common. Cryptocurrency prices often complicate assets recovery and victim compensation.
The Crown Prosecutor’s Office has documented similar cases, including a dark web investigation that includes a digital asset attack. Law enforcement agencies must follow strict guidelines under the Crime Profit Act for value and forfeiture, as shown in one recent case of EX-NCA executives stealing 50 Bitcoin. Values increased by millions between the seizure and the sentencing.
While British authorities are beginning to leverage the value of seized cryptocurrencies to help prevent local crime, across the Atlantic, digital assets are being misused in increasingly deceptive ways.
In the United States, a Colorado pastor and his wife were recently charged with fraudulent $3.4 million investor through a faith-based crypto scheme. They promoted a worthless token called Indxcoin as Divinely Inspired, while they were said to be spending their money on personal luxury.
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