Jailed Fraudster Charged With Moving $290K in Forfeited Crypto From Prison

A Bulgarian man already in custody for one of the larger cryptocurrency laundering cases being prosecuted in the U.S. has been accused of carrying out another scheme from federal prison, allegedly moving $290,000 in cryptocurrency that a court ordered him to forfeit.

Rossen Iossifov, 53, made his initial appearance in court this week in the Eastern District of Kentucky on charges of taking property to avoid seizure, aiding and abetting, and conspiracy to commit money laundering, the Justice Department said in a statement. Prosecutors allege that in January 2024, he conspired to withdraw and transfer the forfeited cryptocurrency through various exchange and mixing services, which pooled funds to hide their trail, keeping the money out of the government’s reach.

Defendants who “disregard legally entered orders” from previous cases will be charged with this obstruction, said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. The U.S. Secret Service, which investigated both cases, called the alleged transfers a “direct challenge” to the courts and to his victims.

The RG Coins case

Iossifov owned and ran RG Coins, a cryptocurrency exchange based in Sofia, Bulgaria, and was convicted of racketeering and money laundering in 2021 for his role in the Alexandria Online Auction Fraud network. The Romanian ring posted fake listings for cars and other valuable goods on sites like eBay and Craigslist, collected payments from at least 900 American victims and funneled the proceeds to foreign money launderers, with Iossifov converting the crypto into cash at the end of the chain.

Trial evidence showed he had laundered nearly $5 million in cryptocurrency in less than three years. He was ordered to pay more than $2.6 million in restitution and forfeit the cryptocurrency now at the center of the new case and was serving a 111-month prison sentence when the alleged transfers took place.

If convicted on the new charges, Iossifov faces a prison sentence of up to 25 years on top of his current sentence. The Justice Department’s computer crime division, which handled the prosecution, says it has secured convictions of more than 180 cyber and intellectual property criminals since 2020 and issued court orders returning more than $350 million to victims.