In order to protect the reputation of your website, I would suggest that you reopen the case and allow OP a further 7 days to provide ID. As it seems like this scam accusation is likely hurting your business.

To OP, it seems like Fairlay requested ID from you (reasonable under AML), and you did not provide it due to having no camera. Surely it is worth buying a camera just to get this money back? Use a friends camera, heck, even go to your nearest Apple store and use one of the display phones if you have to.

In any case, keeping the money does not seem to be the logical solution to this case, you suspect OP of using illicit funds, and yet now you think those illicit funds are somehow yours to keep?