Florida Men arrested After Bitcoin Transfer

Florida Men arrested After Bitcoin Transfer

Two Florida men were recently arrested by police officers after they conducted a transaction with undercover officers using internet currency Bitcoin. Prosecutors are saying that the transactions constituted money laundering and have charged the men with felonies in this case.

Bitcoin exists in a murky legal grey area because it is not stock in a company, representative of a physical good, a recognized currency, or any other type of traded item that the law current provides for. Instead, Bitcoin is specifically intended to be free from the restraints of using money through a traditional bank and exempt from the issues of tying currency to governments.

Of course, it is not as easy as that, since users of Bitcoin must still comply with the relevant laws where they live and use the currency. However, exactly how to use the currency and comply with the law remains confusing for many.

Police involved with the Florida case say that they do not have a bias against Bitcoins but that the believe it can be used effectively for illegal activities. These are the first prosecutions in the state of Florida involving Bitcoins and money laundering, so many are eager to see how the process proceeds and whether these two men will convicted of these crimes.

One other interesting element is that the man apparently transferred the currency to the undercover officer who said that they were using the Bitcoins to buy stolen credit card information. Depending on the way the investigation and sting operation were conducted, it is possible that the men could assert a defense of entrapment, particularly if they did not participate in any activity to actually steal credit card numbers.

Source: Bloomberg, “Miami Bitcoin Arrests May Be First State Prosecution,” Susannah Nesmith, Feb. 10, 2014.

Florida Men arrested After Bitcoin Transfer