PANews reported on September 30th, according to Decrypt, that the U.S. Attorney's Office disclosed that former Los Angeles County Deputy Sheriff Michael David Coberg pleaded guilty on September 26th to federal felony charges of conspiracy to commit extortion and civil rights violations. He used his police position to provide illegal protection to Adam Iza, the self-proclaimed "godfather of cryptocurrency," receiving at least $20,000 per month in compensation. According to the plea agreement, Coberg abused law enforcement power numerous times in 2021, forcing a businessman at gunpoint to transfer $127,000 to Iza and orchestrating a false drug arrest for another victim. This case exposed loopholes in law enforcement oversight, and the Komodo platform's technical director noted that "this case marks a new level of cryptocurrency misconduct, where law enforcement officers have extended their powers beyond their official mandate."

Four law enforcement officers, including Coberg, have pleaded guilty in connection with the case. The principal offender, Iza, obtained $16 million in cryptocurrency through fraud, and his ex-girlfriend has also pleaded guilty to concealing $2.6 million in illicit proceeds. Coberg faces up to 30 years in prison, with a sentencing hearing scheduled for February 2026.