Bradford cryptocurrency fraud case may transfer to different judge

BRADFORD, Pa. — The federal criminal cases involving cryptocurrency against brothers Shane and Sean Hvizdzak may be assigned to District Judge Scott Hardy, which may mean future court proceedings would be in Pittsburgh rather than Erie.

The brothers, Shane Hvizdzak, 33, of Bradford, and Sean Hvizdzak, 35, an attorney who lives in St. Marys, conspired to defraud investors in a limited partnership that was represented as an investment in cryptocurrency, according to an indictment by a federal grand jury. The two are facing charges of conspiracy to commit wire fraud, wire fraud and money laundering.

A civil complaint was filed by the U.S. Securities and Exchange Commission last June based on the same allegations. That case, which is being heard by Hardy, is on a temporary stay while the criminal cases move forward. To date, it appears from the docket that most if not all court appearances have been made via video conference to the courtroom in Erie.

On Sept. 9, Assistant U.S. Attorney Christian Trabold filed an objection to the transfer of the case, noting that if proceedings were to continue in Erie, then he would have no objection to the transfer. However, if it were to mean that future proceedings, including a criminal trial would happen in Pittsburgh, then he would object.

Currently, the case is with Judge Susan Paradise Baxter.

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Quoting the federal rules of criminal procedure, Trabold stated that unless rules permit otherwise, “the government must prosecute an offense in the district where the offense was committed,” and that the court must schedule it within the district for the convenience of the defendant, any victims and witnesses.

Trabold noted the alleged crimes happened in Bradford, most of the alleged victims are from the Bradford area and the FBI office that investigated the case is from Erie. He mentioned, too, that dozens of witnesses would be called at trial, and the trip to Erie is shorter than a trip to Pittsburgh.

Moving the case to Pittsburgh would be costly, Trabold said, as the prosecution and investigative teams would have to stay in hotels throughout the trial, as would victims and witnesses. Should it remain in Erie, that would not be a consideration, he stated.

On Sept. 14, the brothers joined in a response to the motion, saying they had no objection and left it up to the court to decide where it would be heard. Their attorneys, Efrem Grail for Shane Hvizdzak and David Berardinelli for Sean Hvizdzak, said their clients believe the court “should determine which judicial officer in which location would best serve all of the interests of justice in this case, taking strong account of judicial economy and not just driving distances” in making a decision, the court filing read.

Throughout the civil proceedings so far, Sean Hvizdzak has maintained his innocence, while Shane Hvizdzak has claimed his Fifth Amendment right against self-incrimination and has not answered questions, according to the online court docket.