Bulgarian man charged in Lexington after attempt to transfer $290K in seized crypto
A Bulgarian man has been charged in Lexington with attempting to move nearly $300,000 in cryptocurrency the United States government had seized in a money laundering scheme, according to the U.S. Attorney’s office.
Rossen G. Iossifov was already serving a prison sentence of 111 months after being convicted of conspiracy to commit a Racketeer Influenced and Corrupt Organizations Act offense, and conspiracy to commit money laundering in 2021. Iossifov, who operated a cryptocurrency exchange account called RGCoins, and others based in Romania and Bulgaria would post fake advertisements to online auction sites for high-cost items that did not exist, like cars.
Once victims made a payment, the funds would be converted to cryptocurrency and transferred to foreign-based money launderers, including Iossifov. Over the course of three years, Iossifov laundered nearly $5 million in cryptocurrency and targeted at least 900 Americans in the scheme, the attorney’s office said.
As part of his sentence, Iossifov was required to forfeit cryptocurrency worth approximately $290,000 to the United States.
However, in 2024, he attempted to move that money from an account at the Kraken cryptocurrency exchange and transfer the money into currency at a foreign bank account, resulting in additional charges of the destruction or removal of property to prevent seizure, aiding and abetting, and conspiracy to commit money laundering. He appeared in federal court in Lexington on Wednesday.
“Having been convicted of a widespread online auction fraud scheme targeting U.S. victims, Iossifov is now charged with moving cryptocurrency that he obtained from that crime, in violation of a court’s forfeiture order,” said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. “Defendants who flout lawfully entered orders and portions of their criminal sentences in prior federal cases will be charged with such obstructive conduct. The Department of Justice will take all steps to ensure that justice is served for victims of complex financial crimes.”
Rossen pleaded not guilty on Wednesday, according to court documents.
“Such conduct, if proven, reflects a calculated attempt to undermine the rule of law and to compromise the rights of victims who have already suffered significant financial harm,” said Jason Parman, first assistant United States attorney for the Eastern District of Kentucky. “Our office remains steadfast in its commitment to protecting the integrity of judicial orders and ensuring that individuals who engage in sophisticated schemes to obstruct justice are held fully accountable.”
The investigation was conducted by the U.S. Secret Service, with support from the Justice Department’s Office of International Affairs.
“Iossifov’s deliberate attempt to remove and launder lawfully seized funds is a direct challenge to our justice system and a blatant disregard to his victims’ rights,” said Robert Holman, the Special Agent in Charge of the U.S. Secret Service’s Louisville Field Office. “We are committed to ensuring that victims of online fraud receive justice, and that individuals who attempt to circumvent lawful court orders are held accountable.”
A jury trial has been set for Sept. 14.