FOLLOW US

In a dramatic courtroom showdown filled with sharp rebukes, emotional testimony, and legal fireworks, Nicholas Truglia, a 27-year-old convicted bitcoin thief, was slapped with a 12-year prison sentence Thursday by U.S. District Judge Alvin K. Hellerstein—an outcome that has reignited legal debates around double jeopardy, debtor's prisons, and the ever-complex realm of crypto-related fraud.

Truglia, once a slick cybercriminal who hacked into entrepreneur Michael Terpin’s mobile phone to siphon off over $20 million in cryptocurrency, faced resentencing after failing to repay a single dollar in court-ordered restitution. Despite having already served time and walking free on supervised release, his inaction and alleged defiance led the judge to impose a much harsher sentence—a staggering leap from the original 18 months he received in 2022.

“You’d rather be in jail than part with ill-gotten money,” Judge Hellerstein told Truglia from the bench. “The fact that you didn’t pay a single cent indicates to me that it’s all a sham.”

A High-Stakes Legal Gamble

The resentencing unfolded after Truglia violated conditions of his supervised release and continued to evade repayment, according to the Manhattan U.S. Attorney’s Office. Prosecutors had initially sought around five years—already above the court’s calculated guidelines. But Judge Hellerstein, unconvinced by Truglia’s excuses and alleged efforts, went far further.

Defense attorney Mark Gombiner called the 12-year sentence an “extraordinary abuse of discretion,” arguing that it violated double jeopardy protections and weaponized the justice system as a "debtor’s prison."

“This sentence is illegal,” Gombiner said, vowing to appeal. “You can’t ruin a person’s entire life based on that.”

“I Still Have My Money”: Haunting Words Come Back to Bite

Fueling the court’s fury was Truglia’s 2018 interview in a documentary, where he reportedly said, “I still have my money when I get out because it’s bitcoin... I don’t think I’ll do a decade.”

Prosecutors and the judge pointed to the statement as evidence of Truglia’s mindset—that he had always planned to do the time but keep the money.

“It’s not just the crime—it’s the attitude,” Judge Hellerstein said. “In my opinion, it’s just punishment.”

“An Empty Promise”: Prosecutors Rip Truglia’s Credibility

Assistant U.S. Attorney Timothy Capozzi accused Truglia of "lying, faking documents, and hiding assets,” despite swearing in 2022 that he would make things right.

“Years ago, the defendant promised to do his best to right his wrongs. That was an empty promise,” Capozzi said. “He has never intended to pay restitution.”

Joining the hearing via phone, victim Michael Terpin painted Truglia’s post-release behavior as a “smokescreen,” telling the court: “It has cost me millions of dollars.”

Defense Pushes Back: “This Is Unprecedented”

Truglia’s legal team insists that he no longer possesses the stolen funds and that repeated imprisonment over financial restitution creates a chilling precedent.

“As of today, Mr. Truglia has surrendered every valuable asset he has access to,” the defense argued in court filings. “Any concerns about restitution should be handled as violations of supervised release—not by resentencing.”

Still, Judge Hellerstein remained unmoved, noting Truglia’s “continued evasiveness” and repeated failures to comply with court orders.

“You said, ‘I can do 10 years,’” the judge remarked. “Well, you’ll get that chance. I sentence you to 12 years.”

Legal Battle Far From Over

With the defense signaling an immediate appeal to the Second Circuit, the case may ultimately test the boundaries of post-sentencing resentencing in federal court—especially when financial restitution and defiance collide in the murky world of cryptocurrency crime.

Truglia is represented by Mark Gombiner and Allegra Glashausser of the Federal Defenders of New York Inc. The government is represented by Timothy Capozzi of the U.S. Attorney’s Office for the Southern District of New York.