{"id":13940,"date":"2026-10-01T06:53:48","date_gmt":"2026-10-01T06:53:48","guid":{"rendered":"https:\/\/cryptonews.uk.com\/?p=13940"},"modified":"2026-10-01T06:53:48","modified_gmt":"2026-10-01T06:53:48","slug":"us-court-blocks-victims-from-127000-seized-bitcoin-and-petition-rules-are-blamed","status":"publish","type":"post","link":"https:\/\/cryptonews.uk.com\/?p=13940","title":{"rendered":"US court blocks victims from 127,000 seized Bitcoin, and petition rules are blamed"},"content":{"rendered":"<p><\/p>\n<div data-cs-editorial-figure-scope=\"\" data-cs-editorial-quote-scope=\"\" data-cs-image-viewer-scope=\"\" data-single-article-content=\"\">\n<p>Judge Rachel P. Kovner rejected claims by nine alleged fraud victims seeking to contest forfeiture of approximately 127,271 Bitcoin in a Sept. 25 order.<\/p>\n<p>Their filings did not plausibly connect their lost funds to the specific seized wallets, leaving them with a different potential recovery route if the government wins the forfeiture case.<\/p>\n<p>The Eastern District of New York judge struck the timely claims of Ath Leepinyo and Connie Wilson and denied seven other claimants permission to file late. All nine lacked Article III standing, the legal threshold for contesting the action.<\/p>\n<p>The case began with a civil forfeiture complaint filed on Oct. 14, 2025. DOJ said then that the Bitcoin was in US custody and alleged links to fraud and money laundering involving Prince Holding Group, a Cambodian conglomerate, and its chairman, Chen Zhi.<\/p>\n<p>The court treated these claimants\u2019 plausible allegations as establishing, at most, the position of general unsecured creditors: people seeking compensation without a qualifying interest in the particular assets being forfeited.<\/p>\n<p>A loss tied to an alleged fraud did not establish ownership of coins in these wallets.<\/p>\n<p>The order recognized that a constructive trust could give a claimant an equitable ownership interest and standing. That remedy can recognize an interest in property derived from a person\u2019s assets. However, here none of the claimants plausibly alleged the necessary connection between their funds and the seized Bitcoin.<\/p>\n<p>Lawrence D. Van Dyn Hoven, for example, relied on an investigator\u2019s belief that his stolen cryptocurrency was part of the seizure. Kovner found that his filings offered no supporting facts explaining that belief.<\/p>\n<aside id=\"cs-inline-newsletter-1\" class=\"cs-inline-newsletter\" data-inline-newsletter=\"\" data-newsletter-placement=\"article-midpoint\" data-newsletter-pending-label=\"Joining\u2026\" data-newsletter-pending-status=\"Joining The Catalyst\u2026\" data-newsletter-email-required-message=\"Before sending, please provide your email address.\" aria-labelledby=\"cs-inline-newsletter-1-title\" aria-describedby=\"cs-inline-newsletter-1-copy\">\n<div class=\"cs-inline-newsletter__inner\">\n<div class=\"cs-inline-newsletter__content\"> <span class=\"cs-inline-newsletter__eyebrow\"> <i class=\"fa-regular fa-envelope\" aria-hidden=\"true\"\/> The Catalyst <\/span><\/p>\n<h2 id=\"cs-inline-newsletter-1-title\" class=\"cs-inline-newsletter__title\">What\u2019s moving crypto. Why it matters.<\/h2>\n<p id=\"cs-inline-newsletter-1-copy\" class=\"cs-inline-newsletter__copy\">Get CryptoSlate\u2019s essential stories and what to watch next.<\/p>\n<p>  <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"16\" height=\"16\" fill=\"currentColor\" viewbox=\"0 0 16 16\" aria-hidden=\"true\" focusable=\"false\"> <path d=\"M15 3.604H1v1.891h14v-1.89ZM1 7.208V16l7-3.926L15 16V7.208zM15 0H1v1.89h14z\"\/> <\/svg> <span>Published on Substack<\/span> <\/div>\n<div class=\"cs-inline-newsletter__form-shell\">\n<p id=\"cs-inline-newsletter-1-privacy\" class=\"cs-inline-newsletter__privacy\">Seven days a week. Unsubscribe anytime.<\/p>\n<p> <i class=\"fa-regular fa-circle-xmark\" aria-hidden=\"true\"\/> <span>Whoops, looks like there was a problem. Please try again.<\/span><\/p>\n<div class=\"cs-inline-newsletter__success\" role=\"status\" aria-live=\"polite\" aria-atomic=\"true\" tabindex=\"-1\"> <span class=\"cs-inline-newsletter__success-icon\" aria-hidden=\"true\"\/><\/p>\n<div>\n<h3 class=\"cs-inline-newsletter__success-title\">Check your inbox.<\/h3>\n<p class=\"cs-inline-newsletter__success-copy\">Your signup request was sent. If confirmation is required, follow the email from Substack.<\/p>\n<p class=\"cs-inline-newsletter__success-hint\">Look in spam or promotions if you don\u2019t see it.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/aside>\n<figure id=\"attachment_567692\" aria-describedby=\"caption-attachment-567692\" style=\"width: 720px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" loading=\"lazy\" decoding=\"async\" class=\"shoggoth-infographic shoggoth-infographic-portrait wp-image-567692\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202.png\" alt=\"Comparison of ownership standing and conditional DOJ victim remission in the Sept. 25, 2026 order concerning approximately 127,271 Bitcoin: two timely claims struck, seven late requests denied, and any remission discretionary after successful forfeiture.\" width=\"720\" height=\"900\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202.png 1122w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202-240x300.png 240w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202-819x1024.png 819w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202-768x960.png 768w\" sizes=\"auto, (max-width: 720px) 100vw, 720px\"\/><img loading=\"lazy\" loading=\"lazy\" decoding=\"async\" class=\"lazyload shoggoth-infographic shoggoth-infographic-portrait wp-image-567692\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202.png\" alt=\"Comparison of ownership standing and conditional DOJ victim remission in the Sept. 25, 2026 order concerning approximately 127,271 Bitcoin: two timely claims struck, seven late requests denied, and any remission discretionary after successful forfeiture.\" width=\"720\" height=\"900\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202.png 1122w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202-240x300.png 240w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202-819x1024.png 819w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2026\/09\/exec-f6eb326b-11ea-40e4-9caa-4b9eedf9e202-768x960.png 768w\" data-sizes=\"(max-width: 720px) 100vw, 720px\"\/><figcaption id=\"caption-attachment-567692\" class=\"wp-caption-text\">A Sept. 25 ruling rejected nine claims to seized Bitcoin but did not finalize forfeiture or transfer assets to a reserve.<\/figcaption><\/figure>\n<h2>What remission could provide<\/h2>\n<p>Kovner pointed to victim remission if the government succeeds in forfeiting the Bitcoin. That process allows eligible victims to petition DOJ for recovery from forfeited property even when they lack a present ownership interest in it.<\/p>\n<div class=\"cs-article-embed\">\n<p> <span class=\"cs-article-embed__related-reading\">Related Reading<\/span><\/p>\n<h3 class=\"cs-article-embed__title\">US targets $26.4 million in five crypto scam cases as DOJ says $800 million recovered<\/h3>\n<\/p>\n<p> <span class=\"cs-article-embed__arrow\" aria-hidden=\"true\"> <i class=\"fa-light fa-arrow-up-right\"\/> <\/span> <\/div>\n<p>Under 28 CFR 9.8, petitioners must document a specific financial loss directly caused by the offense underlying forfeiture or a related offense, and satisfy other eligibility conditions. Other conditions include no knowing participation in or benefit from the offense, and no willful blindness.<\/p>\n<p>Petitioners must also show they have not been compensated for the loss and lack reasonably available alternative assets for recovery.<\/p>\n<p>When the forfeited property cannot cover petitions in full, recognized victims may receive proportionate shares. Remission is capped at a victim\u2019s share of the associated net forfeiture proceeds, so the size of the Bitcoin seizure is no promise of full repayment.<\/p>\n<p>The Sept. 25 order resolves these nine claimants\u2019 standing. Their potential recovery depends on government success in the forfeiture action and a separate discretionary decision on a documented-loss petition.<\/p>\n<\/div>\n<p>Crime,Featured,Legal,People,Bitcoin,BTCBitcoin,BTC#court #blocks #victims #seized #Bitcoin #petition #rules #blamed1790837628<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Judge Rachel P. Kovner rejected claims by nine alleged fraud victims seeking to contest forfeiture of approximately 127,271 Bitcoin in a Sept. 25 order. Their filings did not plausibly connect their lost funds to the specific seized wallets, leaving them with a different potential recovery route if the government wins the forfeiture case. The Eastern<\/p>\n","protected":false},"author":1,"featured_media":13941,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[91,4795,411,285,900,7211,390,3635,4371],"class_list":["post-13940","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ethereum","tag-bitcoin","tag-blamed","tag-blocks","tag-btc","tag-court","tag-petition","tag-rules","tag-seized","tag-victims"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.6 (Yoast SEO v26.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>US court blocks victims from 127,000 seized Bitcoin, and petition rules are blamed - Crypto News: Latest Cryptocurrency News and Analysis<\/title>\n<meta name=\"description\" content=\"A federal judge rejected nine victims\u2019 claims to 127,271 seized Bitcoin, leaving DOJ remission as their potential recovery path.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptonews.uk.com\/?p=13940\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"US court blocks victims from 127,000 seized Bitcoin, and petition rules are blamed\" \/>\n<meta property=\"og:description\" content=\"A federal judge rejected nine victims\u2019 claims to 127,271 seized Bitcoin, leaving DOJ remission as their potential recovery path.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cryptonews.uk.com\/?p=13940\" \/>\n<meta property=\"og:site_name\" content=\"Crypto News: Latest Cryptocurrency News and Analysis\" \/>\n<meta property=\"article:published_time\" content=\"2026-10-01T06:53:48+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/10\/bitcoin-victim-remission.webp\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"720\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/webp\" \/>\n<meta name=\"author\" content=\"\u884c\u653f\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"\u884c\u653f\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/cryptonews.uk.com\/?p=13940\",\"url\":\"https:\/\/cryptonews.uk.com\/?p=13940\",\"name\":\"US court blocks victims from 127,000 seized Bitcoin, and petition rules are blamed - Crypto News: Latest Cryptocurrency News and Analysis\",\"isPartOf\":{\"@id\":\"https:\/\/cryptonews.uk.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/cryptonews.uk.com\/?p=13940#primaryimage\"},\"image\":{\"@id\":\"https:\/\/cryptonews.uk.com\/?p=13940#primaryimage\"},\"thumbnailUrl\":\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/10\/bitcoin-victim-remission.webp\",\"datePublished\":\"2026-10-01T06:53:48+00:00\",\"author\":{\"@id\":\"https:\/\/cryptonews.uk.com\/#\/schema\/person\/822778c5844e0d16d43dce6630f4f1bf\"},\"description\":\"A federal judge rejected nine victims\u2019 claims to 127,271 seized Bitcoin, leaving DOJ remission as their potential recovery path.\",\"breadcrumb\":{\"@id\":\"https:\/\/cryptonews.uk.com\/?p=13940#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/cryptonews.uk.com\/?p=13940\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/cryptonews.uk.com\/?p=13940#primaryimage\",\"url\":\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/10\/bitcoin-victim-remission.webp\",\"contentUrl\":\"https:\/\/cryptonews.uk.com\/wp-content\/uploads\/2026\/10\/bitcoin-victim-remission.webp\",\"width\":1280,\"height\":720},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/cryptonews.uk.com\/?p=13940#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/cryptonews.uk.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"US court blocks victims from 127,000 seized Bitcoin, and petition rules are blamed\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/cryptonews.uk.com\/#website\",\"url\":\"https:\/\/cryptonews.uk.com\/\",\"name\":\"Crypto News: Latest Cryptocurrency News and Analysis\",\"description\":\"Latest Crypto &amp; 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