Guest post by joseph
Category: Mentions Bitcoin
Relevance: Not particularly relevant to cryptocurrency
Type: Court Case
Location: United States District Court, Northern District of California
Decided: November 18, 2014
Link to the decision: United States of America v. Donagal
United States – United States of America, Prosecution
Donagal – Jeremy Donagal, defendant and alleged international drug dealer.
In May 2011, a grand jury indicted Mr. Donagal with conspiracy to manufacture, distribute, and possession with intent to distribute controlled substances; with the sale of counterfeit drugs; and with international money laundering. The government alleged that Mr. Donagal led an organization producing more than one million counterfeit Xanax pills per week, in addition to other drugs. Mr. Donagal was arrested several days after the indictment. He was alleged to possess more than $1 million in illicit proceeds, he had a known history of using an assumed name and fake identification, and he did not contest the allegation that his wife removed the contents of his safety deposit box immediately after his arrest. At his subsequent bail hearing, the presiding judge found Mr. Donagal to be a flight risk and ordered him to be held in detention pending trial. Subsequently, Mr. Donagal appealed that detention order.
Motion for Reconsideration for Pre-Trial Release denied.
The judge concluded that the government had met its burden of showing by clear and convincing evidence that Mr. Donagal was a danger to the community, and by a preponderance of the evidence that he was a flight risk. The judge also found that Mr. Donagal failed to overcome the presumption that “no condition or combination of conditions will reasonably assure [his] appearance.”
Relevance to Cryptocurrency
The government seized large quantities of cash, drugs, and other assets, including approximately $25,000 in Bitcoin, after the defendant’s arrest. Mr. Donagal and his organization predominantly sold their products in online marketplaces, including Silk Road, Silk Road 2.0, and a personal website. They collected many payments in digital currency.