A Canadian businessman has been sentenced to 41 months in a federal prison in the U.S. for obstruction of justice.
Firoz Patel's sentence was announced by U.S. Attorney Edward R. Martin Jr. and acting Special Agent in Charge Kai Wah Chan of Homeland Security Investigations.
The sentencing stems from Patel's failure to disclose 450 bitcoins during a 2020 trial. He was previously convicted and sentenced to 36 months for running Payza, an unlicensed cryptocurrency payment processing service.
In addition to the prison term, Patel agreed to forfeit any property related to his offense. Instead of complying, he attempted to transfer his cryptocurrency proceeds to Binance after the exchange blocked his account for violating its terms of service. Following this, he withdrew the bitcoins.
Before reporting to prison after April 22, 2021, Patel deposited the 450 bitcoins with an unnamed exchange, which later froze his account. In an effort to recover the funds, Patel communicated with the exchange, asserting he was not subject to U.S. government actions and claiming he owed nothing.
While the exact timing of these interactions is unclear, Patel reportedly provided false Know Your Customer (KYC) information in an attempt to have his bitcoins released. Once law enforcement became aware, an investigation was launched, which Patel learned of while serving his initial sentence.
To evade prosecution, Patel and an accomplice impersonated an attorney and engaged in fraudulent discussions with the U.S. Attorney’s Office, aiming to delay proceedings until Patel could escape to Canada. However, this scheme was uncovered, leading to Patel's indictment in May 2023. He has been in custody since June 2021.
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