[ucha]

The statute of limitation for wire fraud is 5 years. How did he get charged under that statute when he stole funds from Silk Road in 2012? Did they charge him for converting BCH into BTC in 2017?

I tried to look up the case but couldn't find anything that shed a light on that.

[aaronmdjones]

> The statute of limitation for wire fraud is 5 years. How did he get charged under that statute when he stole funds from Silk Road in 2012?

This is a very simplistic view and this mistake is made a lot. There are several reasons why the statute of limitations could either be longer than 5 years or not yet expired even though it is 5 years:

- Tolling. This is when the suspect exits your jurisdiction, preventing you from apprehending them. If the statute of limitations really is 5 years, and you leave the country 4 years after the act; even if you stay abroad for a year, or 5 years, or 20 years, the clock only resumes when you return. You can still be charged 24 years after committing the offense.

- Furtherance. Put simply, if you continue to engage in the activity, the statute of limitations is reset. For example, this article describes his repeated moving of the assets after the initial theft in order to avoid detection.

- Special Circumstances. In this case, there are exceptions that mean that the statute of limitations is not actually 5 years.

It's not clear which of these apply. I would definitely bet on option #2. If he spent any time outside of the country, also apply option #1. If any of the special circumstances defined in the law apply, also apply option #3.

[ucha]

Thanks for explaining this!

It seemed to me that option #1 only applied if you were a fugitive and your whereabouts were unknown, not when you simply leave the state or country.

As to furtherance, I wonder how precise the definition of it is; is using proceeds of a crime, furtherance of a crime? Is obfuscating a crime, furtherance of a crime?

Edit: This answers most of my questions and the answer seems to be "it's complicated" https://sgp.fas.org/crs/misc/RL31253.pdf

[aaronmdjones]

In regards to whether simply leaving the jurisdiction is grounds for tolling the statute of limitations, see 18 USC 3290, which is a one-sentence law reading:

    No statute of limitations shall extend to any person fleeing from justice

It can be reasonably argued that leaving the country after having committed the offense is fleeing from justice. I'm not aware of any supreme court ruling on the matter though, and I am not a lawyer.

Edit: Thanks for the link!

[hsbauauvhabzb]

Is the limitation in relation to being penalised for a crime, or somebody being wanted for a crime?

If there was a police report about a crime, if the police were unable to determine who committed the crime but at a later date could do so beyond reasonable doubt?

What if the perpetrator evades police for 5 years but remains in-state?

What’s your location also, that would be relevant to the laws your referring to.

[aaronmdjones]

The clock starts counting upon the completion of the crime. There are exceptions as I explained previously; for example, if your crime involves conspiracy with another person, then all future communications with or actions in consort with that person in furtherance of your crime resets the clock. To give an example, if you collude with someone in accounting to defraud your company and have them sign false financial statements to cover it up, the clock is reset upon each signature they make or each time you ask.

Some district courts have held that the statute of limitations can be tolled while the suspect is actively evading law enforcement even if they remain within their jurisdiction; some haven't.

I'm in England, but I'm talking about United States Federal Law.

[skizm]

Dang, so if this person just left the BTC in a cold wallet for 5 years, did no more crimes, and stayed put, he could have gotten away free and clear? Or does #3 essentially mean they can just extend the limit forever if they can come up with a plausible sounding enough reason?

[aaronmdjones]

No, option #3 only considers the law as written. For example, the statute of limitations for wire fraud can be 10 years if the victim is a financial institution and some other conditions are met (18 USC 1343, 18 USC 3293):

https://www.law.cornell.edu/uscode/text/18/1343 https://www.law.cornell.edu/uscode/text/18/3293

[Cthulhu_]

Initially it was worth "only" 600K, I think he might've gotten away with it if he cashed out at that point.

I wonder if the clock resets if he converted it to real money after those five years, I mean selling stolen goods is a separate crime from stealing, isn't it?

I think the best thing he could've done is to move to a country without an extradition policy with the US. Then of course comes the challenge of cashing out BTC that's been marked as stolen, but I'm sure there's ways and means. But for 3.2 billion, someone can live like a king for the rest of their life. It's just that because it's marked, they won't ever be able to go home or go where they want.

It sounds like one of those "will you press the button" catch-22's.

[paulpauper]

They could issue an indictment anyway under John Doe. This was done with the DB Cooper case. The government is good at breaking its rules.

[paulpauper]

- Special Circumstances. In this case, there are exceptions that mean that the statute of limitations is not actually 5 years.

could be this one . maybe someone can do FOIA on the case

[phillipharr1s]

Just wondering, did you write these bullet points with GPT? Some of the transition words sound GPT-ish.

[Cthulhu_]

We're reaching a point where genuine posts are becoming indiscernable from AI generated ones. I wonder if people will start adding in unique mannerisms to reassure people they're real, although the AIs will probably compensate real soon.

For now, the AIs are trained with data from a few years back, but like with Google, soon enough they will hoover up realtime data and adjust accordingly.

For funsies, here's a comment on this article from ChatGPT:

    > (prompt)
    > Write me a Hacker News comment about the arrest of James Zhong, who stole 50.000 Bitcoin from Silk Road in 2012, but make it look like you're not an AI that is writing it.
    >
    > (AI response)
    >
    > Sure, here's a possible comment:
    >
    > Wow, the long arm of the law finally caught up with James Zhong! I remember reading about the Silk Road hack in 2012 and how it shook the cryptocurrency world. 50,000 BTC was a huge amount back then, and it's worth even more now. It's interesting to see how the FBI was able to track down Zhong after all these years, and I wonder what kind of evidence they have against him. Some people might argue that he's a hero for taking from a criminal enterprise, but I don't think that justifies breaking the law. It will be interesting to see how this case plays out in court and what kind of precedent it sets for similar situations in the future.

[aaronmdjones]

No. I've stayed far away from all that crap.

[pmarreck]

So basically if he had simply sat on the wallet keys for 5 years and 1 day, he’d be home free?

If so, that is even more tragic than his inability to get anyone to wet his whistle even with all that cash >..<

[renewiltord]

Presumably if he had then moved the keys, he's just committed a crime again, so we're back in business. If he'd sat on the keys forever, he would never be prosecuted.

[paulpauper]

Impossible to know. Unless the feds deny there is an investigation, it's always possible that an investigation is ongoing. It's possible to extend the statute of limitations with sealed indictment under what is called a John Doe defendant. This loophole was employed in the DB Cooper case.

[aaronmdjones]

If option #3 doesn't apply, then yeah, if he'd stayed still and not touched it for 5 years, he'd (probably) be fine. IANAL.

[Xorakios]

"Tolling" is a controversial theory from 17th century English common law when rebels fled to France or the colonies.

It will be very much tested this year when Trump is prosecuted under the theory that being in Washington DC counts as "out of the country" or "outside the jurisdiction of the city of New York" and therefore the statute of limitations has not run out.

[from]

Plea hearing is fun reading: https://storage.courtlistener.com/recap/gov.uscourts.nysd.58...

> So, Mr. Zhong, the statute of limitations for the crime you're charged with in the information is five years. Accordingly, you could argue that the time to prosecute you for this crime has passed, and that the crime is now time barred; you can no longer be prosecuted. Have you discussed this with Mr. Bachner?

> THE DEFENDANT: Yes, your Honor.

> THE COURT: And is it true that you agree to waive any statute of limitations defense you might have with respect to this charge in the information?

> THE DEFENDANT: Yes, your Honor.

For some reason this bug was not as sophisticated as I thought it was:

> THE DEFENDANT: ...In September of 2012, after using the site just once or twice, I decided I no longer wanted to buy anything else from Silk Road and decided to withdraw my bitcoin from the website. While doing so, I accidentally double-clicked the withdraw button and was shocked to discover that it resulted in allowing me to withdraw double the amount of bitcoin I had deposited

His sentencing submission is also interesting: https://storage.courtlistener.com/recap/gov.uscourts.nysd.58...

> After Jimmy took the Bitcoin from Silk Road, Ross Ulbricht contacted Jimmy over the Silk Road messaging service and asked him to explain how he accessed the Bitcoin. After Jimmy told him what he did, Ulbricht never asked Jimmy to return the coins. Rather, he thanked Jimmy for his candor and sent him, unsolicited, additional Bitcoin. Silk Road’s response to Jimmy’s conduct is hardly the response of a victim.

> The Government notes that Jimmy waited around four months from the date of the search to turn over control of the Bitcoin to the Government

> Although the Government had seized the physical device needed to control most of the Bitcoin, the Government had no way to use that device to control the Bitcoin without Mr. Zhong’s cooperation. Jimmy gave the Government, with no promise of anything in return, the keys and tools needed to take control of billions of dollars’ worth of Bitcoin—control that the Government would not have been able to gain without Jimmy’s cooperation

Psychological report: https://storage.courtlistener.com/recap/gov.uscourts.nysd.58...

> He recalled converting some of his Bitcoin into $700,000 in cash. He stated he did this so that he would have a “case full of money like in the movies.” He hoped the visual appeal of the cash would impress a female into having sexual relations with him. He stated his plan did not work.

Government was fairer than usual in their sentencing submission, only asked for 24 months. Honestly this whole story just makes me kind of sad. Also makes me wonder why he even agreed to give up the coins.

[lazide]

The worst part IMO? That the suitcase of cash didn’t work.

[CoastalCoder]

> The worst part IMO? That the suitcase of cash didn’t work.

As a parent of young men, I'm glad it didn't work. IMHO it would have been bad for the character development of both parties.

[yieldcrv]

Its silly he lacks this much awareness, it reads like he just wanted to be rid of the burden because he can’t figure anything social out

People don’t even need actual bitcoin, they just leave their phone wallet open on a watch address while they “go to the bathroom” on a date, and let their nosy date take the bait and watch the tune change in real time

Money still overrides other preferences and exacerbates poor character development across genders, it just means his way was so bad…. Carrying around suitcases wow.

[lazide]

In my experience, someone committing crimes like this has a fundamental issue with their emotional self regulatory ability. Money enables coping mechanisms (well, clearly just sometimes like in this case!) that otherwise wouldn’t be available. It is also a general motivator, as you note, for folks to do all sorts of things for someone besides general emotional coping type stuff. Like get a house, or whatever.

Chances are his social dysfunction really stems from something deep he’s refusing to look at and acknowledge; and it’s feeding all these behaviors maladaptively. He probably had one particular person he wanted the validation he saw as coming from sex with, and that’s why the suitcase.

Especially since, quite frankly, if he just wanted to get laid and had cash, it’s not like it would take that much looking to find someone to help him with that and it wouldn’t involve more than a small handful of bills. If he could get his act somewhat together, anyway.

[lazide]

At the point he's heisted several billion dollars of bitcoin (or anything really), I think it's a bit late to be worrying about that.

[8organicbits]

The other person didn't.

[lazide]

Good point! The baggage is never just what’s in the suitcase (or just the cash, as it were), and (to be serious) glad the other person saw that too. The unimaginable degree of shit that they would be accepting if they took it would be mind boggling.

My guess is that because the other party is not the type of person who would have sex for even a suitcase of cash with them, is why the perp wanted them so much they tried a suitcase of cash.

[rvba]

> THE COURT: All right. I find that Mr. Zhong has knowingly and voluntarily waived both venue as well as any argument here that the crime charged in the information is time barred.

How does this even work?

So can the defendant "knowingly and voluntarily" give up their right to defend via Constitution?

[mbreese]

It's part of a plea agreement. In a plea agreement the defendant gives up certain rights in exchange for other sentencing considerations.

They were worried they'd get a worse sentence at trial, so they plead to get a better deal. They didn't just give up their rights...

[DangitBobby]

It sounds like they did give up their rights! Or else!

Sorry, but there's no reading of it where a plea deal isn't threatening unreasonable punishment if you refuse to forfeit your rights.

[paulpauper]

that is how it works. plea guilty or else roll the dice and likely spend a huge time in jail

[tadfisher]

Federal prosecutors have a 95% conviction rate. I'd take the bargain as well.

[jahewson]

That includes the pleas though. It’s 83% for the cases that make it to trial. Still not great odds.

[PaulRobinson]

I'm not a lawyer, but I've known people go through the (similar, in the UK), mill of prosecution and read/watched enough about some cases to get a sense of how it might play out behind the scenes.

Let's step back, and see if you still think this is "give up your right! Or else!"

The prosecutors are 50/50 on getting a conviction. If they win, they're sure they're going to see the defendant go to prison for, say, 10 years. If they lose, the defendant walks, and thanks to the fifth amendment (almost everywhere in the World has double jeopardy protection), unless substantial new evidence emerges, they'll never get to prosecute this individual again. They're pretty sure they have everything they'll ever find, so this is it.

The defendant and his legal team are 50/50 on getting an acquittal. If they win, it's over. If they don't, it's 10 years in prison which is pretty awful.

The trial is going to be expensive for both sides. The prosecution will work to get the odds in their favour, the defendant's legal team will be trying to figure out how to get it in their favour, and so on.

This process is expensive, and eventually the taxpayer is going to pay. Even if the proceeds from the crime have been recovered and sold, the money going into public funds is going to come right back out again to prosecute, and if the defendant has nothing and can't afford their own legal bills, the taxpayer is paying both sides.

Everybody - and I mean everybody - knows the defendant did what he did.

There are interviews that are barely credible, paper trails of assets moving, lots of evidence of obfuscation and trying to cover tracks, but there's confusion in the story about intent to commit a crime.

The judge might decide to throw it out on statute of limitations, a jury might look at the psych reports and think the kid seems nice and naive and not the criminal type, so let's believe his story.

It's a bit of a mess.

Neither side really fancies were this going because there is concern you're setting off a train of case law, too - as a prosecutor do you really want to test statute of limitations if the person wasn't "fleeing from justice", but just enjoying some money he came into? That defence lawyer really looks like he fancies his day in the Supreme Court...

Meanwhile, the clock - and publicly funded meter - is ticking.

Prosecutor approaches defence. "Plead guilty, we wrap this up, your guy gets 5 years instead of 10. Parole eligible at 3 years".

Defence retorts "2 years, suspended".

Prosecutor comes back "2 years, no suspension, no parole, but time served taken into account".

"Deal". The judge gets a call. He decides to make sure there is no risk of an appeal to make clear to the defendant in court that there are questions about statute of limitations that he would need to waive. Defendant agrees to waive his rights. They move to sentencing, the prosecutor asks for 24 months, the World moves on.

Everyone wins, even though the defendant goes to prison for a while. He's got 20% of the likely maximum penalty on an even money shot, which any gambler will tell you is superb "value".

The prosecutor has lost out in terms of seeing time served, but has got a conviction and saved the taxpayer many, many dollars.

The defendant didn't lose their rights. They looked at a 50/50 shot and decided they'd prefer 2 years guaranteed and get on with their life rather than take a 50% chance of 10 years.

[thrashh]

In this case, it’s not 50/50.

It’s 83/17 where 83% is the “feds win.”

https://www.pewresearch.org/fact-tank/2019/06/11/only-2-of-f...

[mbreese]

As an unaffiliated third party, it’s actually quite the example of game theory in action. Everyone has something to risk and trying to figure out the dance of who gives up what is really interesting.

Until you realize these are peoples actual lives… then it’s also sad.

[Cthulhu_]

I think the defense leaned on the part where the owner of the service basically allowed him to keep it, plus cooperation; if the judge rules him innocent (e.g. while he exploited a bug, the then-owner did not press charges and rewarded him), he might get the BTC back, but this time cleared of any crimes. Meaning he can cash in and walk free.

Well, relatively free, his face and name are known and if he is exonerated, everyone will know he's a multi-billionaire and the life of himself and others are in danger.

[paulpauper]

He gave up the coins because his lawyer probably advised him the statute of limitations would not apply here or hold up. If it did apply there would be no case at all, full stop. So a plea is better than facing up to 20 years.

[Waterluvian]

I’ve wondered about how crimes can seemingly be an instantaneous event with no duration, or can be ongoing for a while.

Crime as an event. Crime as a state. ;)

Is it perhaps that by continuing to act on the proceeds from crime, the individual(s) are prolonging or tacking on additional crimes?

[epgui]

Probably because of discoverability or something like that?