Bitcoin Trader from Florida Charged with Felony for Selling Crypto to Undercover Cops
A Florida man, Michell Espinoza, bitcoin trader by profession is facing felony charges in Miami for selling bitcoin to undercover police. He will be facing a trial by jury after a ruling on Wednesday by the U.S. Third District Court of appeals.
“Espinoza’s bitcoins-for-cash business requires him to register as a payment instrument seller and money transmitter” under Florida financial statutes, the court ruled Wednesday, adding that he was “not merely selling his own personal bitcoins, he was marketing a business.” Now he’ll face serious felony charges for money laundering as well as operating an unlicensed “money services” company.
The case is simply – an act that may run afoul of the Florida statutes, but one to which all parties consented, and as a result of which no party was injured. It is believed that the state of Florida has ruined this trader’s life just for selling cryptocurrency tokens to people who wanted to buy them. The undercover police and the justice system can get someone in such deep trouble for something like this is disconcerting to the utmost is worth making a note.
The Miami Beach police found Espinoza on LocalBitcoins.com. Here he was using the screen name MichellHack and requested the undercover police to meet in person. Technically, the man was not looking to cause any trouble. He wasn’t causing any harm to anyone, just helping residents buy bitcoin. However, the police force in Miami decided to slap felony charges at him.
The undercover officers met Espinoza three times at an ice cream place, a coffee shop, and a hotel, and bought bitcoins worth a total of USD 1,500. He told him they were going to use the money to buy credit card numbers stolen by Russian hackers. This has formed the basis for the money laundering charges.
The Miami-Dade Circuit Judge Teresa May Pooler in 2016 had dismissed the charges against Espinoza, stating, “This court is unwilling to punish a man for selling his property to another when his actions fall under a statute that is so vaguely written that even legal professionals have difficulty finding a singular meaning.”
Since then the Florida “money services” statute was rewritten by the Florida legislature to include “virtual currency” as a form of money, the prosecutor’s case is sure going to weaken against Espinoza in the upcoming trial.
According to Judge Pooler, the police entrapment tactics to get a money laundering charge were not impressive. The case is dependent on whether or not bitcoin qualified as money under Florida law. This ruling by Judge Pooler has grabbed global attention from the cryptocurrency community. Bitcoin is generally considered a form of currency and was relieved for Espinoza’s sake that the charges were dropped.
Charles Evans, an economics professor from Barry University, was brought in as an expert legal witness to the case. He claimed to the court that bitcoin is not money, but something more like comic books, baseball cards, or poker chips that people are willing to buy.
A higher court on Wednesday has, however, overturned the opinion of Judge Teresa Pooler. According to the higher court, Pooler made an incorrect decision to dismiss the felony charges against Espinoza without a trial. They believe that Espinoza was indeed operating a money services business without a license and that the charges will be reinstated.
A trial date for the same is yet to be set.