Federal prosecutors net $19.2 million in sale of forfeited bitcoins seized in ID fraud scheme

Federal prosecutors announced Thursday that $19.2 million was owed to authorities by bitcoins confiscated in fraud cases. This is the largest forfeiture case in northern Ohio.

Mark Simon, a Toledo man sentenced to two-years in prison for conspiracy to launder and transfer false identification documents, was the one to be taken into custody.

Federal prosecutors stated that Simon, 37, created false identification documents such as driver’s licences, personal identification cards, and other forms of identification for Ohio, Michigan, and Utah residents. The documents were purchased by digital photos and false biographical data. He was paid using bitcoin cryptocurrency.

The scheme was discovered by state officials in 2015. In 2015, investigators in Springfield found fake ID cards in a bar close to Wittenberg University. Authorities tracked the identity of the victim online to Simon’s website. Simon was investigated by police in 2008 for creating fake IDs, but he never faced charges.

Authorities linked Simon and other people working with him to the cards after months of investigation, according to documents filed at U.S. District Court Toledo.

Later they searched Simon’s Toledo home and those of other suspects. Simon was seized by authorities with more than 500 bitcoins.

According to the indictment, they were worth more than $5.1million on February 23, 2018, two weeks after raids on the houses. Prosecutors released a statement stating that the bitcoins were once valued at $2.8 million.

Simon pleaded guilty to the charges in June 2019. The case involved the forfeiture of bitcoins by prosecutors. Bridget Brennan, acting U.S. Attorney for Northern Ohio, stated that the bitcoins were sold for $19.2million.

Many of the forfeiture proceeds are split between federal agencies and local police units involved in the case. It is also used to compensate victims of crime. Additional money is returned the U.S. Treasury.

Three other people were also convicted in this case, including Simon. According to court documents Simon suffered the most financial loss and the longest sentence in prison. All the other defendants received probation or a year in custody.