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The Bitcoin that Cleveland resident Gary James Harmon, 31, stole, according to the DoJ, was confiscated during an investigation into his brother, Larry Dean Harmon, who founded and ran the now-defunct darknet Bitcoin tumbler Helix.
By running Helix from 2014 to 2017, Larry Harmon acknowledged he assisted users of the dark web to smuggle money. Helix assisted its customers in moving more than 350,000 Bitcoin, which were worth more than $300 million at the time of the transactions. On February 6th, 2020, Larry Harmon was taken into custody by federal officials, who also took many hardware cryptocurrency wallets. Access to the wallets was not possible for the investigators.
Gary Harmon allegedly found the wallets that had been taken from his brother in April 2020, just after Larry Harmon had been freed pending trial. Then, in a total of eight transactions, he transferred 712.6003 Bitcoin to his own wallets.
After the transactions were found by the investigators looking over the confiscated wallets, a hearing was called in an emergency on April 28th and Larry Harmon was ordered to allow the investigators access to the wallets. Eight out of the 16 wallets were raided by the detectives, who also took possession of a total of over 4168 Bitcoin. The investigators found the other eight to be empty.
Gary Harmon started transferring the Bitcoin he had stolen using secret Bitcoin mixers in August 2020. Additionally, he began withdrawing cash and making significant expenditures.
Gary Harmon’s Bitcoin Theft and Sentencing
On June 28th, 2021, a 10-count indictment was released against Gary Harmon. On January 6, 2023, he admitted to engaging in wire fraud and impeding the administration of justice.
Judge Beryl A. Howell of the US District Court sentenced Gary Harmon to four years, three months in a federal prison. He will also be required to surrender additional assets, including 17,404,400.64 Dogecoin, 2.14 Ethereum, and 647.41 Bitcoin, as well as three years of supervised release.
In August 2021, Larry Harmon admitted to money laundering and stipulated to hand over more than 4,400 Bitcoin. It is unknown when he will be sentenced.