Mediaboss Marketing

By Olumide Babalola

Privacy is dead, and social media hold the smoking gun. Pete Cashmore, Mashable CEOWhen my wife Ajibike clocked forty in August, we had a stimulating conversation on how one can simultaneously celebrate such remarkable moments on social media and yet realistically control how others access and use ones personal information (pictures, videos etc) publicly shared on such occasions especially on WhatsApp.In a recent article on the nature of WhatsApp as a private or public space, I respectfully submitted that the advent of modern technology has changed the conventional meaning of many words. This also includes the meaning and nuances of privacy as a concept as opposed to its associateds right. At page 9 of my book Privacy and data protection law in Nigeria (2021), I emphasised the difference between privacy and right to privacy by likening them to a situation of egg and chicken where privacy is an object and right to privacy is a legal entitlement to that object. Often times, social media users have been confronted with unpleasant scenarios of privacy paradox where they seek to enforce (right to) privacy over contents they happily and voluntarily post on social media into public domain. In this brief article, I answer a major question associated with this everyday reality arising out of the (mis)use of personal information found on social media in relation to (right to) privacy or its expectation thereof.Do social media users have reasonable expectation of privacy over publicly disclosed/shared personal information?Like privacy itself, the term reasonable expectation of privacy is incapable of generally acceptable definition. With the unprecedentedly intrusive nature of technology, reasonable expectation of digital privacy changes with every update or upgrade of social media apps and platforms. Bruce Schneier, the chief security technology officer of BT a British multinational telecoms company shared same sentiments in his book Schneier on Security. He argues that Even if society still has some small expectation of digital privacy, that will change as these and other technologies become ubiquitous. In short, the problem with a normative expectation of privacy is that it changes with perceived threats, technology and large-scale abuses.In English privacy law, the concept of reasonable expectation of privacy was introduced by Lord Nicholls in Campbell v MGN [2004] 2 AC 457 (21) that: Essentially the touchstone of private life is whether in respect of the disclosed facts, the person in question had a reasonable expectation of privacy. For this purpose, the courts have devised many (I dare say, non-fool proof, subjective and objective) tests and factors to be considered to wit: (a)whether the information can be regarded as private or public (b) whether disclosure of the information would be highly offensive to a reasonable person of ordinary sensibilities (c) attributes of the victim (d) the nature of victims activity intruded or violated (e) the place where the event happened (f) extent, nature and purpose of the intrusion (g) absence of consent and whether it was known or could be inferred (f) effect of intrusion on victim (g) manner of storage or communication or publicity. etc. (See N.A. Moreham, Unpacking the reasonable expectation of privacy test L.Q.R. 2018, 134(Oct), 651-674).For social media, the dynamics are significantly different. While users can claim expectation of privacy over certain information shared with a restricted group of friends, such expectation is not absolute because social media is ordinarily designed for many people to access information shared on such platforms. In United States v. Joshua Meregildo & Others No. 11 Cr. 576(WHP), one of the defendants, Colon, a Facebook user shared messages detailing acts of violence and threatened new violent acts to rival gangs. Although his Facebook account had privacy settings restricting his posts to only friends, during investigation when the police had access to his messages through one of his friends account, Colon challenged the access as a violation of his right to privacy. In resolving the issue, the district court in New York ruled extensively that:A person has a constitutionally protected reasonable expectation of privacy when they have both a subjective expectation of privacy and that expectation is one that society recognizes as reasonable.Generally, people have a reasonable expectation of privacy in the contents of their home computers. But this expectation is not absolute and may be extinguished when a computer user transmits information over the Internet or by e-mail.Facebook and social media generally present novel questions regarding their users expectations of privacy. Facebook users may decide to keep their profiles completely private, share them only with friends or more expansively with friends of friends, or disseminate them to the public at large. Whether the Fourth Amendment precludes the Government from viewing a Facebook users profile absent a showing of probable cause depends,inter alia,on the users privacy settings. When a social media user disseminates his postings and information to the public, they are not protected by the Fourth Amendment. However, postings using more secure privacy settings reflect the users intent to preserve information as private and may be constitutionally protected.On Colons reasonable expectation of privacy, the district judge, Pauley William held further that:Here, Colon maintained a Facebook profile in which he permitted his Facebook friends to view a list of all of his other Facebook friends, as well as messages and photographs that Colon and others posted to Colons profile. The Government viewed Colons Facebook profile through the Facebook account of one of Colons friends who was a cooperating witness. By that means, the Government learned,inter alia,that Colon posted messages regarding prior acts of violence, threatened new violence to rival gang members, and sought to maintain the loyalties of other alleged members of Colons gang. Access to Colons Facebook profile formed the core of the Governments evidence of probable cause supporting its application for the search warrant. Where Facebook privacy settings allow viewership of postings by friends, the Government may access them through a cooperating witness who is a friend without violating the Fourth Amendment.While Colon undoubtedly believed that his Facebook profile would not be shared with law enforcement, he had no justifiable expectation that his friends would keep his profile private.And the wider his circle of friends, the more likely Colons posts would be viewed by someone he never expected to see them. Colons legitimate expectation of privacy ended when he disseminated posts to his friends because those friends were free to use the information however they wantedincluding sharing it with the Government.When Colon posted to his Facebook profile and then shared those posts with his friends, he did so at his peril. Because Colon surrendered his expectation of privacy, the Government did not violate the Fourth Amendment when it accessed Colons Facebook profile through a cooperating witness.From the courts impeccable reasoning, it is logical to conclude that, once a user shares his personal information on social media, even if restricted to a circle of friends, he cannot justify reasonable expectation of privacy especially where he lacks control over his friends use of such information. One must however add here that, there may however be exceptional cases where the facts and circumstances can justify such reasonable expectation of privacy.Mund argues that even where a social media user has reasonable expectation of privacy, such claims will be negated by two exceptions: (a) third party doctrine where a user invests information with a third party (the platform) and then gives consents to be shared with other recipients (other users) and (b) voluntary consent to social media searches. (See Brian Mind Social Media Searches and The Reasonable Expectation of Privacy 19 Yale J. L. & Tech. 238 (2017). Ultimately, it must however be emphasised that social media users would always have reasonable expectation of privacy against the owners/operators of social media platforms especially along the line of published privacy policies/notices on such platforms. Hence, privacy in the context of social media interactions must be distinguished from the notion of secrecy.ConclusionTheoretically, one can(not) share certain personal information and retain control over its use by others to a certain extent. However, especially for personal or household processing of personal data, social media users cannot realistically have reasonable control over the use of publicly available personal information even though in the event of misuse they can be entitled to remedies at law. Technically, there are no straight answers to questions of privacy, every case is determined on its peculiar facts even though the principles keep emerging as technology evolves. Finally, even when a user subjectively expects a measure of privacy on personal contents posted on social media, the factors that determine whether such information remain in the private or public spaces are more objective than dependent on the users expectations alone.

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Privacy In Social Media: Can We Realistically Eat Our Seclusion In Public And Still Keep It Private? - TheNigerialawyer

Regulatory scrutiny of the use and management of cryptocurrency and other digital assets such as utility tokens and non-fungible tokens (NFTs) (collectively, cryptoassets) is rapidly growing on both sides of the Atlantic. With increasing governmental enforcement and private litigation involving cryptoassets, it is vital for individuals and businesses whose activities involve these assets to understand the broad legal framework for enforcement and the types of disputes and legal actions into which they could be drawn. Even if they are not the targets of enforcement actions or parties to legal proceedings, they may have to respond to subpoenas or other court orders. While most of the enforcement actions and litigation to date has involved cryptocurrencies, some have involved NFTs and other types of digital assets.

This article analyzes tools and procedures that enforcement authorities in the U.S. and U.K. may use to seize and forfeit cryptoassets and provides an overview of related regulatory developments in these jurisdictions.

Cryptocurrencies and other digital assets constitute a growing share of global financial assets. As of April 2022, cryptocurrencies were purportedly worth almost $2 trillion, the U.S. Securities and Exchange Commission (SEC) estimated. Despite the recent volatility in cryptocurrency markets and the decline in the value of some cryptocurrencies in May and June of 2022, cryptoassets remain widely held and retain significant value. As of June 2022, cryptocurrencies were still valued at just under $1 trillion, with cryptocurrency prices showing signs of recovery according to reports by Reuters in June 2022 and August 2022. In February 2022, Her Majestys Revenue and Customs (HMRC) estimated that approximately 10% of U.K. adults own or have owned cryptoassets, and 68% of those are likely or very likely to acquire more.

The meteoric rise in the use and management of cryptocurrency in recent years has led to an increase in related crime. According to data provider Chainanalysis, $1.9 billion worth of cryptocurrency was stolen from January 2022 through July 2022, compared to just under $1.2 billion at the same point in 2021. Per the Chainanalysis 2022 midyear report, much of this illicit activity can be attributed to the rise in funds stolen from decentralized finance (DeFi) protocols, with North Korea-affiliated groups alone having stolen an estimated $1 billion of cryptocurrency from DeFi protocols as of July 2022. Fraudsters may deploy a range of strategies, including ransomware attacks, hacks or deception to steal from unsuspecting victims, or use cryptoassets to launder criminal proceeds.

Against this backdrop, both U.S. and U.K. law enforcement agencies have increasingly used the tools at their disposal to combat cryptocurrency-related crime. For example, in February 2022 the U.S. Department of Justice (DOJ) announced the seizure of $3.6 billion worth of bitcoin in connection with the 2016 hack of Bitfinex the largest financial seizure ever.

Similarly, in July 2021, Londons Metropolitan Police seized 180 million of cryptocurrency in connection with suspected money laundering and, more recently, the U.K.s National Crime Agency (NCA) reported that it confiscated around 26.9 million in cryptocurrency assets between April 1, 2021, and March 31, 2022.

In the U.S., cryptoassets have been the focus of much attention by enforcement authorities in recent years. At the federal level, this is mainly the purview of the SEC, DOJ, the Commodity Futures Trading Commission (CFTC) and the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of Treasury.

In February 2022, the DOJ formed the Virtual Asset Exploitation Unit (VAXU) within the Federal Bureau of Investigations (FBI), which is dedicated to blockchain analysis and virtual asset seizure. VAXU is expected to work closely with the DOJs National Cryptocurrency Enforcement Team (NCET), which was launched in October 2021.

In addition, in March 2022, Attorney General Merrick Garland launched a new interagency taskforce dubbed KleptoCapture to hold accountable corrupt Russian oligarchs. The task forces mission explicitly includes targeting the use of cryptocurrency to evade sanctions or launder money, with a focus on asset seizure.

In May 2022, the U.S. District Court for the District of Columbia upheld the DOJs criminal complaint against an unnamed U.S. citizen who allegedly helped customers evade U.S. sanctions by funnelling more than $10 million of bitcoin through a virtual currency exchange from the U.S. to a country that is subject to U.S. comprehensive sanctions. In so doing, the court adopted for the first time the Office of Foreign Assets Controls (OFACs) recent guidance on sanctions compliance obligations, saying that virtual currency is subject to OFACs regulations, and financial services providers to whom U.S. sanctions regulations apply include virtual currency exchanges.1

Overview of Cryptoasset Forfeiture by US Authorities

U.S. authorities have increasingly used asset forfeiture as a tool in crypto-related enforcement proceedings, seizing several billions of dollars of cryptoassets in recent years. For instance, since 2015, the U.S. Internal Revenue Service Criminal Investigation (IRS-CI) has seized over $3.5 billion in cryptocurrency, and, as of December 2021, the U.S. Marshals Service held $919 million in cryptocurrency.

In April 2022, federal prosecutors working with local Florida law enforcement obtained forfeiture of $34 million worth of cryptocurrency tied to illegal dark web marketplace activities. The IRS-CI, Department of Homeland Security (DHS), FBI, U.S. Postal Inspection Service (USPIS) and U.S. Drug Enforcement Agency (DEA) jointly investigated this case.

U.S. prosecutors are expected to pursue increasingly aggressive civil forfeiture actions targeting cryptoassets. In these cases, the government can transfer the funds in question instantaneously, whereas transfers involving fiat currency or personal property can take much longer, making crypto-related forfeiture an appealing mechanism for authorities.

In order to forfeit cryptoassets, U.S. authorities generally first trace the cryptoassets and transactions using publicly available blockchain information and analytics tools to identify relevant information, such as the dates and amounts of transactions and the origination and destination public address(es). If needed, agents can then issue subpoenas to financial institutions, virtual-currency exchanges or other third-party intermediaries to obtain relevant records.

This approach got a boost in 2020, when the U.S. Court of Appeals for the Fifth Circuit held in United States v. Gratkowski that federal agents did not need to first obtain a warrant based on probable cause to subpoena bitcoin records.2 In Gratowski, the federal agents used forensic software to extract suspicious addresses from the bitcoin blockchain and then subpoenaed a virtual currency exchange to trace the customers who had made bitcoin payments to those suspicious addresses.

The court held that a person generally has no legitimate expectation of privacy in information he voluntarily turns over to third parties, treating bitcoin records kept by the exchange in the same way as customer financial records kept by banks in that bank records are not subject to Fourth Amendment protections.3 The court further held that Gratowski did not have a privacy interest in his information on the bitcoin blockchain since that information is available to every bitcoin user, making it possible to determine the identities of the bitcoin address owner by analyzing the blockchain.4

Armed with this data, authorities can establish the assets nexus to criminal activity and its location information that is required to obtain a search warrant authorizing seizure of the asset. Subsequently, authorities may seize the cryptoasset using such a warrant, or through another method that otherwise fulfils the governments obligations under the Fourth Amendment (searches and seizures), such as with the owners consent. Forfeiture proceedings are then required so that the title to the seized assets can be permanently transferred to the government. Cryptoassets can be forfeited via administrative, civil judicial or criminal judicial forfeiture, as discussed below.

U.S. authorities are increasingly working with cryptoasset and blockchain analytics firms to use advanced technologies to uncover illicit activity and identify linked actors, in addition to crime proceeds and other forfeitable assets. Since 2017, federal agencies including the DEA, DHS, IRS, FBI and CFTC have spent millions of dollars on third-party cryptoasset tracing and blockchain analytic tools.5

These technologies have already been put to use at a large scale. For example, in November 2020, using blockchain forensics, the DOJ and IRS identified and retrieved, through a civil forfeiture action, $1 billion worth of illicit bitcoin stolen from Silk Road more than seven years earlier.

More recently, in February 2022, the U.S. District Court for the District of Columbia held that the governments use of reliable blockchain analysis software that traced the flow of stolen digital currency to the investigations targets supported probable cause for a search warrant.6 The court further highlighted that such software was becoming commonplace for law enforcement to track financial crimes, noting that this sort of analysis had demonstrated an unprecedented rate of success when compared to human informants, bolstered by the softwares lack of incentive or capacity to lie.7

This ruling was in accord with the New York State Department of Financial Services April 2022 guidance stating that cryptocurrency firms should use blockchain analytics tools to help mitigate and manage financial risk, and to meet AML and sanctions-related compliance requirements.

U.S. authorities are also working to increase cooperation with foreign authorities to identify and trace cryptoassets that may be subject to forfeiture. For example, on 5 April 2022, the DOJ announced the seizure of Hydra Market, the worlds largest and longest-running darknet market. The Hydra servers and cryptocurrency wallets containing $25 million worth of bitcoin were seized in Germany by the German Federal Criminal Police (the Bundeskriminalamt), in coordination with multiple U.S. agencies, including the DEA, DHS, USPIS, FBI, IRS, DOJs Office of International Affairs, the U.S. Attorneys Office for the District of Columbia and the NCET.

Administrative Forfeiture

Many federal law enforcement agencies are authorized to seize cryptoassets valued at less than or equal to $500,000 at the time of seizure via an administrative forfeiture procedure without judicial approval. The agency involved seizes the asset, provides notice to potential claimants, and processes any claims to the assets. Any timely and legally valid claims are referred to the U.S. Attorneys Office, which must then commence a civil forfeiture action in federal court. In the absence of any such claims, the agency can complete the forfeiture without judicial involvement. Assets with a timely and legally valid claim to them, or those valued at more than $500,000, must be forfeited via a civil or criminal forfeiture action.

The DEA, DHS and USPIS have all successfully seized and obtained legal title to cryptocurrency via administrative forfeiture in the past.8

Criminal Forfeiture

Criminal judicial forfeiture actions are in personam (against the person) actions against a defendant where only property in which the defendant has a true interest may be forfeited. A criminal forfeiture proceeding starts by adding a forfeiture allegation to a charging document and requires that the defendant be convicted of an offense that allows the forfeiture of property. The government must establish by a preponderance of the evidence the requisite connection between the crime of conviction and the asset. Crimes such as those involving money laundering and various types of fraud and counterfeiting allow criminal forfeiture. A separate ancillary proceeding follows to determine any third-party ownership interests in the property that the government seeks to forfeit.

In what is believed to be the largest cryptocurrency fraud ever charged criminally, in November 2021, a district court granted the DOJs request to liquidate $57 million in cryptocurrency seized from Glenn Acaro, the top North American promoter of the cryptocurrency bitconnect. Acaro pled guilty to participating in a conspiracy that defrauded investors of over $2 billion. In the charging document, the DOJ sought criminal forfeiture pursuant to 18 U.S.C. 982(a)(2)(A) and 28 U.S.C. 2461(c) of the fraudulently obtained proceeds in Acaros possession, the majority of which were held in cryptocurrencies, including bitcoin, ethereum, litecoin, dash and several others.9

Civil Judicial Forfeiture

Civil judicial forfeiture actions are in rem court proceedings brought against property that was derived from or used to commit an offense, rather than against a person who committed an offense. Unlike criminal forfeiture, no criminal conviction is required. The government must still prove that the property was linked to criminal activity by a preponderance of the evidence.

This proceeding allows the court to gather everyone with an interest in the property and resolve all the claims to it in one proceeding.

Not only does this procedure require a lower burden of proof; it allows the government to reach more property than criminal forfeiture. This includes property of criminals located outside the U.S., such as terrorists and fugitives. It also permits recovery of assets held by deceased defendants, or where no defendant can be identified since the action is against the asset itself.

The governments notice requirement for in rem forfeiture proceedings can be met if the government attempts to provide actual notice. In United States v. Twenty-Four Cryptocurrency Accounts, for example, it was held that the government provided sufficient notice to the public and to potential claimants of its forfeiture action in rem against cryptocurrency accounts allegedly used in connection with a child pornography website where the government had sent direct notice via certified mail or email to potential claimants who could be identified by currency exchange information; sent notice an additional time when emails or certified letters were returned as undeliverable; and posted a public notice on an official government forfeiture website for 30 consecutive days.10

The IRS and DHS enlisted the help of South Korean law enforcement to seize the servers and related materials, which were located in South Korea. A review of the seized materials revealed bitcoin transactions, which allowed law enforcement to obtain a warrant and seize all 24 related cryptocurrency accounts.11 The court granted the governments motion for default judgment for the forfeiture of all 24 accounts.

In the U.K., regulation of cryptoassets has likewise become a focus for regulators and law enforcement agencies. Under the FCAs scrutiny, crypto-related firms now face a new requirement to register in the U.K., and cryptoasset firms must comply with anti-money laundering (AML) regulations, and are subject to the FCAs enforcement powers. Between January 10, 2020, and October 20, 2020, alone, the FCA opened 39 inquiries into cryptoasset businesses. In March 2022, the FCA announced that, between September 2021 and March 2022, it had opened 300 investigations into unauthorized cryptoasset operators. Echoing the FCAs commitment, the U.K. Serious Fraud Office (SFO) announced in its 2021/22 Business Plan that the growth of cryptocurrency would be one of its key focus areas.

In March 2022, U.K. regulators issued a joint statement signaling that financial sanctions do not differentiate between cryptoassets and other types of assets. The statement made clear that the use of cryptoassets to circumvent economic sanctions is a criminal offense under the Money Laundering Regulations 2017 and regulations made under the Sanctions and Anti-Money Laundering Act 2018. The FCA confirmed that it had written to all registered cryptoasset firms and those holding temporary registration status to highlight the application of sanctions to various entities and individuals.

More recently, the May 2022 Queens Speech outlined a new Economic Crime Bill under which the authorities will gain more tools to halt illicit finance in the U.K., including the power to seize cryptoassets. No implementation timetable has been provided yet.

Criminal Forfeiture

There are a number of tools available to U.K. law enforcement to address cryptoasset-related crime. These include orders to restrain, seize, forfeit and confiscate assets, as well as orders to obtain information about potential wrongdoers.

Law enforcement can secure a restraint order under s41 Proceeds of Crime Act 2002 (POCA) to prohibit a person from dealing with any realisable property held by them, provided that certain conditions are met. This includes, for example, where a criminal investigation or proceedings relating to an offense have started in England and Wales and there are reasonable grounds to suspect that the alleged offender has benefitted from his criminal conduct.

A restraint order freezes assets wherever in the world they are and prevents assets from being moved or dissipated. Given the nature of the order, it is usually obtained without notice to a defendant. Non-compliance with a restraint order is a contempt of court, and in extreme cases, may be treated as perverting the course of justice.

In a mark of flexibility, courts have found cryptocurrency to meet the definition of realisable property for the purposes of POCA. In the recent case of Lavinia Deborah Osbourne v (1) Persons Unknown (2) Ozone Networks Inc. trading as Opensea [2022],12 the High Court recognized NFTs as legal property over which a freezing injunction could be ordered, thereby extending to NFTs the courts previous framing of cryptocurrencies as proprietary assets. The NFTs here were two unique digital artworks, stolen from the claimants digital wallet in January 2022, and traced to two wallets. An urgent freezing order was granted in March 2022, freezing the assets until the end of proceedings. This landmark case confirmed that NFTs should be treated as standalone assets, separate from the underlying pieces that they represent.

English courts have been willing to grant not only restraint and freezing orders relating to cryptoassets, but also confiscation orders where certain conditions are met, namely:

When making a confiscation order, the court must decide whether the defendant has a criminal lifestyle and whether he has benefitted from general or particular criminal conduct.

In R v Teresko [2018],13 the defendant was convicted of drug and money-laundering offenses. In related restraint proceedings, the police were permitted to restrain the defendants cryptoassets and convert seized bitcoin into sterling. The court subsequently made a confiscation order over the defendants bitcoin, worth 975,000.

Similarly, in R v West [2019],14 the defendant was convicted of hacking into company databases, selling the data on the dark web and converting the funds into cryptocurrency. He was ordered to pay a confiscation order that included cryptocurrency valued at 922,978.

Together, these examples reflect that English courts are prepared to use conventional tools in novel contexts in aid of criminal justice.

However, challenges may arise when it comes to enforcement. For example, successful seizure of cryptoassets usually depends on obtaining the owners private key. Prosecutors are likely to have greater success in obtaining a private key where it is held by a bank or crypto exchange on a persons behalf. However, where the key is held by the individual owner, the prosecutor may have to rely on the cooperation of the defendant or further court proceedings.

In Ireland, the so-called Fishing Rod Case15 demonstrated the challenges that can arise in seizing cryptoassets without the private key. A defendant hid the key for his cryptoassets, worth an estimated 45 million, in a fishing box that was thrown away by his landlord while he was in police custody. While the digital wallets were seized by the Irish state, without the secure key, the assets are unobtainable.

Another key challenge is the issue of anonymity. Cryptoassets are attractive for unlawful conduct because they can be held and transferred anonymously. Unless there is proof a defendant is dealing or concealing illegal cryptoassets, the court may find it difficult to make an order. In Teresko, the key for the defendants bitcoin wallet was found during a search of his property, and in West, the defendant was arrested while he was using his computer, allowing the police to access his virtual wallet and provide evidence to the Crown Prosecution Service.

It is not just cryptocurrency that can be seized. On February 13, 2022, Her Majestys Royal Customs (HMRC) used its POCA powers to seize NFTs as part of a 1.4 million VAT fraud investigation that involved around 250 allegedly fake companies. HMRC was the first U.K. agency to seize an NFT. HMRC Deputy Director Economic Crime Nick Sharp said this confiscation case should deter the view that cryptoassets serve to hide money from HMRC.

Civil Asset Recovery Enforcement Actions

Alongside the criminal orders under POCA, U.K. law enforcement also has the power to recover assets in the civil courts on the civil standard (i.e., balance of probabilities) under POCA. A prosecutor can seek a civil recovery order, which provides that specific property is recoverable on the basis that is represents the proceeds of unlawful conduct. In effect, this is a confiscation order without the triggering conviction.

DPP v Briedis and Reskajs [2021]16 is a prime example of this procedure in action. There the Director of Public Prosecutions sought a freezing order under s245A POCA (civil recovery powers) against two respondents covering cash in various currencies, money in bank accounts, personal items and cryptocurrency. The court was satisfied that cryptocurrencies fell within the wide definition of other intangible property under POCA s316(4).

That case referred to the reasoning in AA v Persons Unknown [2019],17 in which the claimant paid a bitcoin ransom to a hacker in exchange for decryption software and, following recovery of the encrypted files, the claimant took steps to recover the ransom. Given that the court in this case was prepared to recognize cryptocurrency as property under POCA provisions related to property freezing orders, it is likely that a civil recovery order could also have been obtained over it.

Going further, if a prosecutor obtained a civil recovery order, it could, in theory, also obtain an Unexplained Wealth Order (UWO) on cryptoassets pursuant to s362A POCA. However, they are unlikely to be the tool of first choice, given that cryptoassets are less readily identifiable than a tangible asset. A UWO application requires a description of the property and the suspected owner, which may be difficult in cryptoasset cases.

The trend toward greater regulation of cryptoassets and more enforcement in cases of wrongdoing is likely to continue as authorities respond to the growth in cryptoasset use. Commenting on the high degree of fraud involving the asset class, SEC Commissioner Hester Peirce said at a conference in May 2022 that the United States has dropped the regulatory ball and has got to get working to target fraud and play a more positive role in cryptocurrency innovation.

To manage cryptoasset-related legal and compliance risk stemming from efforts to seize and forfeit cryptoassets, organizations can take a number of steps including:

Trainee solicitor Clara Rupf contributed to this article.

_________________________

1 In re: Criminal Complaint, No. 1:22-mj-00067, 2022 WL 1573361, at *3 (D.D.C., 2022) (citing U.S. Dept of the Treasury Sanctions Programs Related to Digital Currency Transactions); see also OFAC Enters Into $98,830 Settlement With BitGo, Inc. for Apparent Violations of Multiple Sanctions Programs Related to Digital Currency Transactions, U.S. Department of Treasury (Dec. 30, 2020).

2 United States v. Gratkowski, 964 F.3d 307 (5th Cir. 2020).

3 Id. at 310-11 (citing to United States v. Miller 45 U.S. 435, 439-40 (1976)).

4 Id. at 312.

5 Felix Mollen, Coinbase Secures Another Millionaire Deal With the US Government To Let Them Use Its Blockchain Analytics Software, CryptoPotato (June 8, 2020); Danny Nelson, Coinbase Offers US Feds New Crypto Surveillance Tools, CoinDesk (June 5, 2020); Danny Nelson, Inside Chainalysis Multimillion-Dollar Relationship With the US Government, CoinDesk (Feb. 10, 2020).

6 Matter of Search of Multiple Email Accts. Pursuant to 18 U.S.C. 2703 for Investigation of Violation of 18 U.S.C. 1956, No. 20-SC-3310 (ZMF), 2022 WL 406410 (D.D.C. Feb. 8, 2022).

7 Id. at *13.

8 See, e.g., FOR SALE Approximately 4,041.58424932 bitcoin, U.S. Marshals Service (February 2020 auction); Roger Aitken, U.S. Marshals to Hold Bitcoin Auction for $50 Million Worth of Cryptocurrency, Forbes (January 12, 2018).

9 United States v. Glenn Arcaro, No. 21CR02542-TWR. (S.D. Cal.), Complaint.

10 United States v. Twenty-Four Cryptocurrency Accts., 473 F. Supp. 3d 1 (D.D.C. 2020).

11 Id. at *3-4.

12 The full High Court judgment is yet to be published.

13 R v Teresko (Sergejs) [2018] Crim. L.R. 81.

14 R v West [2019], unreported, 28 September 2019, Southwark Crown Court.

15 DPP v Collins [2020], unreported, February 2020.

16 DPP v Briedis and Reskajs [2021] EWHC 3155 (Admin).

17 AA v Persons Unknown [2019] EWHC 3556.

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Cryptoasset Seizures and Forfeitures: US and UK Enforcement Overview - JD Supra

This is a tale of two houses, said Rep. Jared Huffman (D-Calif.), slamming Schumer and Manchins agreement to take up permitting reform in exchange for his vote on the party-line bill as a sleazy backroom deal.

Its all shaping up as Democrats last big internal fight before the midterms, a rare remaining sore point for a party thats largely and finally united on everything from abortion to the economy to same-sex marriage. And after nearly an entire Congress defined by the 50-50 Senate, the House is taking a starring role: Sen. Bernie Sanders (I-Vt.) is pledging to vote against the permitting bill if its linked with government funding, but lower-chamber progressives are offering the main intraparty resistance to Manchins plan.

The Senate is planning to pass a short-term funding bill with permitting reform attached just before the Sept. 30 deadline, daring Grijalva and his allies to risk a shutdown fight over the issue, according to multiple Democrats familiar with the plan. In an interview on Monday, Manchin seemed unworried about the fate of his proposal: I would think that common sense would have to kick in sooner or later.

The text of Manchins permitting bill is not yet public, but senior Democrats in both chambers are downplaying the chances of disaster. Several lawmakers and aides said they believe there is a path to an amended deal that can win over Grijalva and other House Democrats while keeping Manchin on board.

One key motivator: Many clean energy advocates say a permitting deal as envisioned by Manchins initial framework would benefit renewable projects, including wind and solar generation, even if it would also accelerate some fossil-fuel pipelines, such as the long-stalled Mountain Valley natural gas line that originates in the senators home state.

Permitting reform, as Manchin put it, means were able to have the energy security that our country needs now. Referring to new transmission lines for renewable energy, he added: And as we move towards the transition [to clean energy], youre able to do that with the infrastructure its going to take. ... I would like to think people are being practical and not being political.

President Joe Biden hands the pen he used to sign the Democrats' landmark climate change and health care bill to Sen. Joe Manchin (D-W.Va.) as Senate Majority Leader Chuck Schumer watches in the White House in Washington, Aug. 16, 2022.|Susan Walsh/AP Photo

The West Virginia centrist said he understands if House Democrats are still steaming over the downsizing he exacted upon their original party-line domestic agenda. Yet liberals across the Capitol vow their opposition to his plan is not retribution for two years of Manchin-induced headaches from his reshaping of the $1 trillion-plus Build Back Better bill into the smaller Inflation Reduction Act, to the Houses forced swallowing of last years bipartisan infrastructure bill, derided by some on the left as basically a Republican effort.

Instead, House Democrats say its all about what they see as an environmentally hazardous permitting deal that undercuts some of the climate provisions they won in this summers new law.

Still, a few Democrats admit theyre relishing their chance to hold some leverage over the West Virginian.

Its about time, quipped retiring Rep. John Yarmuth (D-Ky.), who joined about 70 Democrats in urging party leadership to keep Manchins bill separate from government funding.

Its a pretty important vote and we shouldnt play games with it to make it impossible to defeat, Yarmuth said, adding that he and other House Democrats never signed off. Thats totally Schumers deal. Im not bound by Schumers agreement.

Theres another big incentive to limit the blast radius of the permitting fight. Democrats are entering the pre-midterms stretch with a singular focus on avoiding self-inflicted political wounds, including the potential for a shutdown. Sen. Chris Murphy (D-Conn.) said he needs to see the permitting text before he can say whether hell support it, but urged his party to be strategic about picking fights that could endanger a government funding patch.

It could be that people are looking for leverage, Murphy said of Democrats positioning. Or it could be that House members are still cross at Joe Manchin.

If the permitting push does hitch a ride on the Senates funding bill this month, House Majority Leader Steny Hoyer (D-Md.) hinted at the steep climb and possible education campaign that skeptical Democrats in his chamber might need to sign on.

Theres no doubt its controversial, Hoyer told Bloomberg TV of Manchins permitting plan on Monday. And well have to convince our members that the language that is brought over does not undermine our environment.

Manchin said Schumer and Pelosi are standing firm in their commitments to him: I believe exactly what theyve told me they see exactly what this country needs and why we need to make sure that we have to be the superpower of the world. He said he was buoyed by the Monday release of a competing permitting reform bill by dozens of Senate Republicans as a show of bipartisan support for his ideas.

The road to an eventual permitting law is still looking bumpy, with some of the nations most vocal environmental groups galvanized into their own missives opposing what they called a fossil fuel wish list that would perpetrate environmental racism, among other effects. Some climate activist groups have already staged protests.

In a recent interview, Grijalva wouldnt say whether he and other progressives were willing to take the whole ship down and trigger a standoff over government funding. But he said that any Manchin-led permitting bill would face a great deal of resistance without significant changes.

And while Democrats cheered their summers huge climate gains in the Manchin-crafted party-line bill, plenty of progressives feel they owe him nothing on the separate issue of energy permits. Huffman said that while some of the bill could end up being good policy, he stressed that it needed to be considered in the light of the day not in some back room with Joe Manchin.

Beyond Sanders, progressives on the Senate side are staying out of the fray for now and calling for a pragmatic approach. Sen. Brian Schatz (D-Hawaii), whos already backed the permitting deal, said that disagreements within the Democratic coalition are natural, but like it or not, in order to build the kind of clean energy we want, we are going to have to change some federal laws.

Josh Siegel contributed to this report.

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'Sleazy backroom deal': Progressives tangle one more time with Manchin - POLITICO

Healey, if she wins, would also be the states first openly gay female governor. And she will run for governor on a two-woman ticket with Salem Mayor Kim Driscoll, who cruised through her three-way Democratic primary for the No. 2 spot on Tuesday setting up Massachusetts as one of three states that may elect women to both offices this year at the same time. In Arkansas, Republicans nominated Sarah Huckabee Sanders for governor and Leslie Rutledge for lieutenant governor. And in Ohio, Democrats are running Nan Whaley and Cheryl Stephens.

With your help, for the first time, Massachusetts will elect the first governor and lieutenant governor on an all-woman ticket, Driscoll told supporters after declaring victory Tuesday night. Thats right not one, but two women in the corner office.

Further down the ballot, former Boston City Councilor Andrea Campbell would become the first Black woman elected attorney general if she defeats Republican Jay McMahon in November. Campbell and Rayla Campbell, a Republican running a long-shot campaign for secretary of state against seven-term Democratic incumbent Bill Galvin, said they made history Tuesday night as the first Black women nominees for statewide office in Massachusetts.

Treasurer Deb Goldberg is unopposed in her reelection bid. And state Sen. Diana DiZoglio is one step closer to the auditors office after defeating her Democratic primary rival, Chris Dempsey, on Tuesday.

It is kind of stunning that, despite our progressive reputation, Massachusetts has never elected a woman governor and we have never had women really set to lead the commonwealth across the highest offices, Amanda Hunter, executive director of the Barbara Lee Family Foundation, which advocates for women in politics, said in an interview. This is a major turning point.

But heated general-election battles will need to be fought first. Diehls victory over more moderate Republican Chris Doughty tees up the gubernatorial contest to be a referendum on Trumps legacy in a state that twice handed him some of his biggest defeats.

And the progressive wing of the Democratic Party in Massachusetts is littered with losses after Tuesdays primaries. While they cheer the likelihood of shattering several glass ceilings in November, progressive activists who won major victories in recent years with Rep. Ayanna Pressley, Sen. Ed Markey and Boston Mayor Michelle Wu are smarting after their statewide candidates fell short.

State Sen. Sonia Chang-Daz, who ran to Healeys left in a battle between two progressives, dropped out of the Democratic primary in June. Quentin Palfrey, who won the state partys endorsement for attorney general, ended up exiting the race a week before the primary to back Andrea Campbell. Three other candidates backed by major progressive groups Dempsey, state Rep. Tami Gouveia for lieutenant governor and Tanisha Sullivan for secretary of state all lost Tuesday night.

They generally lacked either campaign cash, name recognition in a low-interest primary, slick outreach operations, or all three. Chang-Daz proved unable to compete with the near-universal recognition Healey, a two-term attorney general, had with Democratic primary voters or her massive campaign coffer. Healey entered the general election with more than $4.7 million.

Palfrey, despite being the state Democratic Partys 2018 nominee for lieutenant governor, trailed in polling against Andrea Campbell, who was coming off a third-place finish in last years Boston mayoral race, and Shannon Liss-Riordan, a labor attorney and former U.S. Senate candidate who poured $9.3 million of her own money into her campaign. Sullivan and Gouveia never advertised on television.

Weve had candidates in recent years whove done a lot of really great progressive agenda-setting, but also spent a lot of time laying their groundwork, Jonathan Cohn, policy director for Progressive Massachusetts, said in an interview. One of the problems this cycle is there arent that many candidates who have done that.

To be clear, Healey is a progressive just not one whos as far left as some activists in Massachusetts wanted.

But Cohn and other progressives say theyll take Healey if it means retaking the corner office from Republicans who have held it for the better part of 30 years and breaking some barriers along the way.

Massachusetts is no stranger to electing women: Former Lt. Gov. Evelyn Murphy became the first to win one of the states six constitutional offices in 1986, followed by former Treasurer Shannon OBrien in 1999. In 2001, Jane Swift stepped up as acting governor when then-Gov. Paul Cellucci resigned to become U.S. ambassador to Canada.

But two decades after Swift, Massachusetts has lagged behind many other states. Nine states have sitting female governors. Thirty of the 45 women who have served as governor across 31 states were elected to the job, while the rest were appointed or took on the role through constitutional succession, according to Rutgers Universitys Center for American Women and Politics.

This state has always had a reputation of being pretty parochial and stuck to people who look more like me: white, Irish and male, former state Democratic Party Chair Phil Johnston said in an interview. So this represents a radical departure that I think should be celebrated. Its great progress in Massachusetts.

While the Republican primary for lieutenant governor was too close to call early Wednesday morning, Driscolls victory on the Democratic side guarantees the general election will be a contest between two female candidates. And the bevy of women running for statewide office comes a year after voters saw four women, including Andrea Campbell, lead the field for Boston mayor.

Even just seeing multiple women running for these positions, it helps to break down a lot of long-held stereotypes that voters have, explained Hunter, of the Barbara Lee Family Foundation. We know from our research that when we ask voters to picture a governor, a majority still picture a man. Just seeing different examples of what a candidate looks like helps voters expand that perception in their mind for the future.

This potential banner year for female candidates at the statewide level in Massachusetts comes as the U.S. Supreme Courts decision to upend five decades of constitutional access to abortion drives women in some states to register to vote in droves.

While abortion is enshrined in state law in Massachusetts, Democrats from Healey on down the ballot have made clear through stump speeches and television ads that they will be champions for reproductive rights. And they argue that their Republican opponents wont be in a state where 78 percent of residents believe abortion should be legal in all or most cases.

Women are energized, Assistant House Speaker Katherine Clark (D-Mass.) said in an interview. And this election, more than any other I can think of, has such ramifications for women.

CORRECTION: An earlier version of this report misstated the last name of Amanda Hunter, the executive director of the Barbara Lee Family Foundation.

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Healey inches toward historic first in Massachusetts as progressives get steamrolled - POLITICO

To the editor:

Dont be duped by progressive dopes. Bidens Inflation Reduction Act helps millions with medical concerns? Remember the keep-your-doctor medical plan. If moron Biden says inflation is zero, why do we need a trillion dollars Inflation Reduction Act? He claims to save families $1,800 a year. Bidens inflation, gas prices and higher taxes cost families $8,000 a year. Oh, you have to buy a $70,000 electric car to save $1,800. Do you think new IRS agents carrying guns are there to send your refunds faster?

Biden allowing fentanyl into America killing 100,000 a year, more than twice those killed in Vietnam in 12 years but has done nothing to control smuggling or the borders.

Biden wants you to take public transportation. Hows that going to work for you? Walk a few blocks, get on bus, get off blocks from work and walk the rest of the way. Good luck finding a bus route to serve you. What if you work out of town? Morality does not depend on progressive or woke ravings. Wrong is wrong, even if everybody is wrong. Right is right, even if nobody is right.

Bidens dimwitted press secretary states there are no unvaccinated people walking across our border. Shes stupid or a liar, and probably both, as most progressives are. How is it no competent Democrat wants Biden to campaign with them?

Illegal aliens are housed in $700-a-night hotels in New York City, while veterans sleep under bridges. Here is an example of corrupt Dumbocrats thinking: Gov. Gavin Newsom of California says all cars be electric by 2035. On Tuesday, he ordered residents not to charge cars and reduce power usage because the electric grid cant produce enough power. Heres stupid on steroids, but Biden holds California up as his prize example for America. Does this scare you? It should. Whats the difference between California and Titanic? Titanic had its lights on when it sank.

Valley progressives must drink from the same bucket. Gas isnt lower because of liar Biden. Its because people cant afford to drive so demand goes down and supply rises. Basic economics, which progressives dont grasp. Gas at $3.72 is still $1.60 higher after Brandon took office. Dont accept their new normal.

Where do valley progressives get their facts and figures Bidens dimwitted press secretary? Valley progressives are as intelligent as she. These dummies refuse to acknowledge Bidens failed economy and how its hurting all valley families.

Linda Caputos letter GOP suppressing our rights (Aug. 27), states Republicans suppressing voter rights. Where? She doesnt name one place, or say how. She supports open borders. How many illegal aliens will she take into her home? Another of her scare tactics: Republicans will kill Social Security. Theyve been saying this for 50 years. Defend Hunter, the smartest man Joe knows, to us.

Valley progressives defend mindless Bidens policies. That should scare you.

Barry Bardone

Bloomingdale

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