On Thursday, Gary Harmon, a resident of Ohio, was sentenced to a four-year prison term after he pled guilty in January to stealing more than 712 Bitcoin (CRYPTO: BTC) from a computer seized by the federal government.
According to a release from the Department of Justice, Harmon must also give up “specific properties,” including the crypto holdings, which are valued at over $20 million.
This cryptocurrency bust has been one of the latest crackdowns on digital currency as the Department of Justice is following patterns of behavior related to money laundering.
“The U.S. Department of Justice has been increasingly aggressive in prosecuting crimes involving cryptocurrency,” said Patrick Todd, an attorney who was previously a prosecutor at the Texas Attorney General’s office now at the Comptroller of Public Accounts. “It’s unsurprising that they would prosecute someone who brazenly took bitcoin from his brother while he was under investigation by authorities.”
Prior to his sentencing, Harmon faced up to 40 years in prison stealing digital assets from his brother, who founded Coin Ninja, LLC., an Ohio based company where he was a web developer.
In April 2020, Harmon used the credentials of his older brother, Larry Harmon, to recover 713 Bitcoin that been stored on a device the latter had used as part of a dark net-based cryptocurrency money laundering service. The Bitcoin was valued at about $4.8 million at the time, according to the Justice Department.
Larry Harmon was charged in February 2020 with laundering over $300 million worth of Bitcoin by operating the dark net-based service Helix. He pled guilty 18 months later.
A court filing reveals that prosecutors and Gary Harmon’s lawyer had differed over the sophistication required to pull off the theft.
“While the conduct was certainly illegal, it is practically no different and no more sophisticated than obtaining a key to a safe deposit box and taking the contents of that box,” Gary Harmon’s lawyer wrote, according to Bloomberg.
The prosecutors countered, writing that “[while] physical world analogies often fall short when describing cyber incidents, the defendant’s conduct is more analogous to using powerful tools to silently tunnel into a bank vault from a neighboring building and siphon out all the funds while law enforcement was futilely trying to unlock the bank’s front door.”
Prosecutors said Gary Harmon used 68 Bitcoin as collateral for a $1.2 million loan and spent some to buy a luxury condo in Cleveland. The Justice Department also found a photo of him in a nightclub bathtub full of dollar bills on his phone.
The department said that the 712 BTC would be worth just under $21 million at today’s prices.
Bitcoin can be used on different platforms that include CashApp, Strike, PayPal, and through other banks.
Harmon will have to forfeit the cryptocurrency assets as part of his sentencing behind bars.
With the laundered cryptocurrency, Harmon spent his bitcoin on a luxury condominium in Cleveland. He was pictured in a nightclub in bath of cash. Authorities had confiscated his phone analyzing his cryptocurrency spending habits.
Produced in association with Benzinga