Gangster has £1.25m of bitcoin seized by police

Surrey Police becomes the first force to convert cryptocurrency into sterling for government coffers

Bitcoin and other cryptocurrencies are used in dark web markets (REUTERS/Benoit Tessier/ Composite)

A gangster £1.2m worth of the digital currency bitcoin along with money, gold, watches and jewellery which were found by police after his girlfriend reported he had been kidnapped.

Sergejs Teresko’s partner and members of the public raised the alarm when he was snatched from wealthy Virginia Water in Surrey in April last year.

When police went to search the area they found the rented house, the Latvian national had vanished from had been turned into a huge cannabis factory.

Teresko, a senior member of an organised crime gang, turned up safe and well the next day. When officers searched his semi-detached house in Cobham they were stunned to find a keepkey device holding the bitcoin.

They also discovered nearly £263,000 in cash in a heavily sealed box and a number of designer watches.

Despite having no obvious legitimate employment, Teresko drove a Range Rover Evoque and had access to a safety deposit box containing gold bars, loose gemstones, jewellery and £20,000 cash.

Surrey Police has now become the first UK force to successfully seize bitcoin, convert it into sterling and be granted permission by a court to keep the cash for government and police coffers.

Detective Inspector Matt Durkin said: “Cryptocurrency is used legitimately by a lot of people but it’s also used by criminals. We know that in dark marketplaces bitcoin is the chosen medium of exchange.

“We were not going to accept that bitcoin was out of the reach of law enforcement, it’s not and nor are other types of cryptocurrency.”

Teresko pleaded guilty to money laundering, cultivation of cannabis and the possession/control of articles for use in fraud at Kingston Crown Court on 6 October and was jailed for nine years and three months.

Earlier this week, a judge at the same court found that Teresko had benefited from his criminal activity to the tune of £2m, and must forfeit £1.45m including the value of the bitcoin.

He must also pay an additional £13,150 within three months or face another 10 years in jail.

Surrey Police successfully claimed £64,000 in compensation for the owners of the Virginia Water home who had no idea their house had been converted into a drugs farm.

Officers seized 295 bitcoin, which when converted to sterling were worth £1.25m; assets that included a £12,000 Rolex and a £9,000 sapphire necklace; and the cash Teresko had hidden in his home and safety deposit box.

Press Association