Lancashire Police Turn Crypto Confiscation into £500K Anti-Crime Budget After Landmark Wallet Freeze

Key Takeaways:

• Lancashire Police will reinvest £500,000 from a Bitcoin forfeiture tied to a 2017 fraud case.
• The force has applied a crypto wallet freezing order under the Proceeds of Crime Act for the first time.
• The victim was repaid in full, and surplus funds will be directed toward crime prevention through a national innovation fund.

Lancashire Police will receive £500,000 to reinvest in crime prevention after securing a forfeiture order on Bitcoin linked to a 2017 fraud case, according to a statement published by the authority.

The investigation began when officers received a report of stolen funds later traced to Bitcoin conversions by offenders from Blackpool, Fleetwood, and Blackburn. Those involved were prosecuted and sentenced, while the Bitcoin’s value increased beyond the original stolen amount.

First Use of Crypto Wallet Freezing Powers

In a first for the force, a crypto wallet freezing order was applied under the Proceeds of Crime Act, allowing the assets to be seized.

The victim was fully compensated, and with the law prohibiting overpayment, a £1 million surplus remained. A judge approved its forfeiture, directing the proceeds to be split between the Home Office and Lancashire Police.

Half of the funds, £500,000, will be allocated to the Prevention and Problem-Solving Innovation Fund within the coming months.

Detective Sergeant David Wainwright of the Economic Crime Unit said, “This is a great result for the people of Lancashire, and hopefully the first of many future uses of this new legislation.”

Funds to Support Local Safety Initiatives in the UK

The fund prioritizes community projects, crime prevention programs, and law enforcement tools. Previous allocations have included drones for surveillance, spam-call-blocking devices, and initiatives approved by the Antisocial Behaviour Prevention team.

Wainwright noted that while it was unusual for criminal property to appreciate beyond the original crime value, the outcome both compensated the victim and created resources to reduce future offenses.

By reinvesting seized crypto assets, Lancashire Police seek to disrupt criminal financial gains while strengthening public safety efforts across the county.

Cryptocurrency is increasingly being addressed in financial crime enforcement, not only in seizure but also in post-recovery management. Police departments are beginning to handle digital assets through legal and administrative processes similar to those used for physical property.

In the UK, as discussions continue around a formal digital asset framework, cases involving crypto recovery may influence how local forces approach asset tracing, evidence handling, and redistribution of funds.

Frequently Asked Questions (FAQs)

How might this case affect future fraud investigations involving cryptocurrency?

It could encourage wider use of wallet freezing orders and expand training for officers on tracing digital asset flows.

What challenges do police face when valuing seized cryptocurrency?

Volatility makes asset valuation complex. Authorities must often secure court approval quickly to manage the risk of large price swings.

Could crypto forfeitures change how police forces budget for technology?

Yes. Consistent inflows from such cases could allow forces to self‑fund advanced digital crime‑fighting tools without relying solely on central budgets.