šµļøāāļø Federal Charges and Allegations
Tushal Rathod, 44, of Baldwinsville, New York, has been charged with wire fraud, conspiracy, and money laundering in a scheme that defrauded victims of approximately $1.7 million between November 2021 and June 2024.
The criminal complaint was filed on June 16, 2025, and Rathod was arrested by FBI agents on June 29, 2025. The scam used business email compromise (BEC) techniques and fake checks to steal funds, which were then laundered through cryptocurrency.
š» Scheme and Use of Cryptocurrency
ā Rathod allegedly set up seven business bank accounts across six financial institutions to receive fraudulent deposits obtained through phishing emails and forged invoices.
ā Once the stolen funds were secured, he routed them through multiple personal and third-party accountsāincluding those of his girlfriend and family members.
ā He then used these stolen U.S. dollars to buy Bitcoin, converting approximately $1.2 million into crypto. In February 2023, he executed two major Bitcoin purchases totaling around 40 BTC (worth roughly $900,000 at the time). The BTC was transferred to an unidentified recipient, making the funds harder to trace and recoverāan intentional move to obscure the origin and ownership of the illicit gains.
ā ļø Bank Scrutiny and Recovery
Multiple banks flagged Rathodās transactions as suspicious. In one case, M&T Bank intercepted a fake invoice before payment. When questioned, Rathod claimed he was a victim himself and declined to provide documentation. Despite these evasions, Citibank successfully recovered $800,000, likely before those funds were converted into crypto.
š§āāļø Tip-off and Crypto Clues
A key lead came from Rathodās former partner (and mother of Rathodās child), who contacted authorities after noticing unusual crypto activity and overhearing him discussing Bitcoin transactions in multiple languages. This tip helped investigators uncover the laundering trail and the use of cryptocurrency as a shield for the fraudulent proceeds.
āļø Legal Outlook
Rathod faces up to 20 years in prison if convicted. The case highlights a growing pattern where traditional financial fraud schemes are combined with cryptocurrency purchases to rapidly move, conceal, and potentially cash out stolen funds beyond the reach of regulators.