TL;DR: A Rochester man has been sentenced to 51 months in federal prison after fraud schemes that prosecutors put at $2.06 million in actual and intended losses, including card payments funnelled through Stripe into Bitcoin.
A Rochester, New York, man has been sentenced to 51 months in federal prison for conspiring to defraud victims, including taxpayers, of more than $2 million and for money laundering, federal prosecutors announced. Timothy Wadsworth, 35, was sentenced on Oct. 23 by U.S. District Judge Frank P. Geraci Jr.
In addition to the prison term, Wadsworth was ordered to pay $810,965.19 in restitution and to forfeit $810,956.19, which prosecutors said represents the wire fraud proceeds he received. He was convicted of conspiracy to commit wire fraud and money laundering.
Between March 2020 and September 2021, Wadsworth conspired with others to fraudulently obtain money through several schemes running at the same time, according to the U.S. Attorney’s Office for the Western District of New York.
From Stripe payments to Bitcoin
The centrepiece of the case was a card-payment scheme. Using account numbers supplied by co-conspirators, Wadsworth attempted 310 payments totalling $1,673,578 through Stripe, which processes card payments for businesses, between March 10 and May 15, 2020. Of those attempts, 116 were initially successful, totalling $730,728.22.
Those transactions were fraudulent, prosecutors said: the account holders did not authorise them, and their account information was used without permission. Money from successful payments moved from Stripe to accounts Wadsworth controlled at HSBC and Evolve Federal Credit Union, then to his Coinbase account, where he bought Bitcoin and sent it to co-conspirators. Several transfers exceeded $10,000.
Pandemic relief and other schemes
The fraud did not stop with card payments. Prosecutors said Wadsworth and others submitted nine false Economic Injury Disaster Loan applications between May 2020 and May 2021; three were approved and paid $161,200 into his bank accounts. Two Paycheck Protection Program loans paid $20,833 and $20,416.
The wider schemes also included about $65,896 in unemployment benefits, a $42,000 wire from a victim in a romance scheme, and $26,000 in losses to six other victims. Altogether, prosecutors put actual and intended losses at $2,059,893.
The sentence and the money owed
The 51-month sentence, just over four years, reflects a conviction on conspiracy charges rather than on every individual transaction. The restitution order of $810,965.19 is the amount Wadsworth must repay to victims, while the forfeiture order of $810,956.19 targets the proceeds he personally received from the wire fraud.
Restitution and forfeiture serve different purposes: restitution aims to make victims whole, while forfeiture strips the offender of criminal gains. Both can be pursued alongside a prison term, and unpaid amounts can follow a defendant after release.
How the case was built
The case was investigated by the FBI and prosecuted as part of the Justice Department’s Task Force to Eliminate Fraud. Cases like this one often begin with banks or payment processors flagging unusual transactions, then expand as investigators trace money through accounts and cryptocurrency exchanges.
For victims, the lesson is a familiar one: unauthorised card transactions, fake relief applications and romance-scheme wires all leave trails, but they can take years to untangle, and recovery is rarely complete.
Featured image: representative scene photo, not a photo of the people or the exact location in this case. Image source: courthouse photo
Sources: U.S. Department of Justice, Western District of New York.
Frequently Asked Questions
Who was sentenced in the Rochester fraud case?
Timothy Wadsworth, 35, of Rochester, New York.
What was his sentence?
51 months in federal prison, plus $810,965.19 in restitution and $810,956.19 in forfeiture.
What was he convicted of?
Conspiracy to commit wire fraud and money laundering.
How did the card scheme work?
Wadsworth used account numbers supplied by co-conspirators to process unauthorised payments through Stripe, moved the money through bank accounts, bought Bitcoin on Coinbase and sent it to co-conspirators.
How much money was involved?
Prosecutors put combined actual and intended losses at $2,059,893 across schemes from March 2020 to September 2021.
What other schemes were included?
False pandemic-relief loan applications, unemployment benefits, a romance-scheme wire and losses to six other victims.
Who sentenced him?
U.S. District Judge Frank P. Geraci Jr. imposed the sentence on Oct. 23.
