New Zealand Movie Pirate Arrested with $4.3 Million in Crypto

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An internet movie pirate has been arrested in New Zealand with NZ$6.7 million (US$4.3 million) in cryptocurrency and NZ$1.1 million (US$706,000) in bank funds, according to the New Zealand Herald. Jaron David McIvor, 31, helped create a movie pirating site from which he personally profited to the tune of some NZ$2 million ($1.28 million) but was found in possession of the keys to cryptocurrency wallets containing the rest.

PayPal Activity Tips Off IRS

Police allege that McIvor was part of a group of individuals who pooled their time and expertise in setting up and operating the site which charged for pirated movies, with other members linked to the website living in the United States, Canada, and Vietnam also under investigation. McIvor’s money was allegedly deposited into his bank accounts through international wire transfers, PayPal, and Stripe, which he used to buy and sell Bitcoin. PayPal alerted the United States Inland Revenue Service (IRS) about suspicious activity on McIvor’s account and the IRS tracked him down to his address in Hamilton, New Zealand, where they found McIvor living with his parents in a modest house and showing no signs of his millionaire status. He soon handed over the keys to the crypto wallets containing the millions in BTC and other coins, which have now been seized by police under their Criminal Proceeds Recovery Act which came into force in 2009.

Seized Bitcoin Could be Auctioned

Copyright infringement is a crime in the United States, meaning that McIvor could be charged with money laundering, something his lawyer has denied. A High Court judge will decide whether the seized assets are to be ultimately forfeited to the Crown either by way of a trial or a potential settlement agreement which could eventually see the cryptocurrency auctioned off to the public. Public auctions of illegally obtained Bitcoin are nothing new, with the most famous example being Tim Draper’s 2014 purchase of 30,000 BTC seized from the Silk Road’s coffers. At the end of September the UK held its first ever Bitcoin auction, with the practice seemingly set to grow as authorities get a better handle on interpreting Bitcoin transactions and uncovering criminals’ identities.