The US Department of Justice has filed new charges against Bulgarian national Rossen Iossifov, who is currently serving a sentence for a multimillion-dollar online auction fraud scheme. Prosecutors say he tried to move $290,000 in crypto out of a Kraken account, even though a court ordered those assets forfeited back in 2021. Iossifov now faces up to 25 years in prison on the new charges, filed by prosecutors in Kentucky.
New Charges From Kentucky Prosecutors
The US Attorney's Office for the Eastern District of Kentucky announced the charges on Thursday. According to the DOJ, Iossifov conspired back in January 2024 to withdraw and transfer crypto that a federal court had ordered forfeited following his 2021 conviction. Investigators say the assets moved through illicit mixing services and several exchanges before the US could actually take possession of the funds.
In crypto forfeiture cases, government agencies typically gain control of an account only on paper. Actual access to the funds stays complicated until the asset is moved to a wallet fully controlled by investigators, and prosecutors say that is exactly the stage where the alleged violation took place.
Iossifov faces three new counts: removing property to prevent seizure, aiding and abetting, and conspiracy to commit money laundering. Each count is charged separately, and combined they carry up to 25 years on top of the sentence he is already serving. Prosecutors say attempts to dodge a forfeiture order are rare among defendants already in custody. An indictment remains only an accusation, and under US law Iossifov is presumed innocent unless a court finds otherwise.
Who Is Rossen Iossifov
Iossifov, a Bulgarian national, was convicted in 2021 of racketeering conspiracy and money laundering conspiracy. He belonged to a fraud network that spent at least three years scamming Americans through fake listings on popular online auction sites: victims paid for goods they never received. The network operated through popular marketplaces for used electronics and cars, where scammers posted attractive listings priced below market. The scheme victimized more than 900 people across multiple states.
Prosecutors say Iossifov owned and personally ran a crypto exchange called RG Coins. Through that platform, his associates converted money stolen from victims first into crypto and then back into cash, muddying the trail for investigators. In under three years, nearly $5 million in illicit funds passed through the scheme. Prosecutors describe RG Coins as a key tool that let the group hide the origin of stolen money from banks and payment systems.
How the Funds Were Allegedly Moved Out of Restraint
The Kraken account registered to Iossifov remained under restraint throughout the investigation. In its announcement, the DOJ did not specify how the convicted man managed to access the account while serving his sentence. That question will likely become one of the key issues at trial, since it goes straight to whether Iossifov acted alone or had outside help.
- funds were allegedly moved through mixers that blend transactions and obscure the true source of the money
- part of the assets were transferred to other crypto exchanges before the US could fully lock down the account
- prosecutors have not yet disclosed whether investigators managed to recover the diverted funds
- the new case is being handled separately from the 2021 conviction, even though both episodes involve the same assets
Lawyers who follow similar cases note that attempts to circumvent an already-issued forfeiture order are rare, but they almost always trigger fresh, standalone charges. For prosecutors, such episodes mean extra work: they have to recover the assets and also prove fresh criminal intent after a prior sentence has already been handed down.
The Wider Fight Against Crypto Fraud
Iossifov's case shows that even after a forfeiture ruling, assets aren't always kept under full government control while the seizure process plays out. Convicted defendants keep looking for ways to move funds, forcing investigators to track crypto movements alongside the main court case. In recent years, US prosecutors have increasingly opened follow-up cases against defendants already convicted of crypto crimes after uncovering attempts to hide assets from forfeiture. That adds extra legal work for the system, but it also gives investigators more practice handling similar cases.
The charges against Iossifov landed right after Interpol reported a wallet tied to a romance-scam network that processed more than $122 million over 10 months. Both cases show that law enforcement is watching crypto flows more closely even after the main court process has formally wrapped up.
Most similar US cases still involve Bitcoin as the most common asset in money laundering investigations. At the same time, offenders increasingly convert stolen funds into stablecoins like USDT, since that speeds up transfers between accounts and makes tracking harder for law enforcement.
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