Silk Street Vendor Pleads Guilty to Cash Laundering $19 Million With Bitcoin

A former narcotics trafficker pled guilty to fees that he laundered $19 million in gain by means of Silk Street.

Prosecutors with the Southern District of New York announced a plea deal with Hugh Brian Haney on Thursday, adding one more postscript to the notorious dim internet marketplace’s history. According to a press release, Haney was accused of laundering close to $20 million using bitcoin in early 2018.

Silk Street was among the dim web’s earliest drug marketplaces and a haven for its bitcoin-accepting vendors right until its operator, Ross Ulbricht, was arrested in October 2013 and the site was shut down. Ulbricht is presently serving a daily life sentence on fees of narcotics distribution, personal computer hacking and conspiracy. 

Haney was just one of the sellers who used the marketplace. According to the prosecutors, Haney was a “high-ranking member” of a narcotics outfit recognised as Pharmville, and is stated to have received practically 4,000 bitcoin from Silk Street-connected accounts by means of February 2012. According to the criticism, he trafficked in fentanyl, oxycontin and other narcotic revenue.

“Hugh Haney used Silk Street as a signifies to offer medicines to people all around the environment,” U.S. Attorney Geoffrey S. Berman stated in a statement. “Then he laundered a lot more than $19 million in profits by means of cryptocurrency.”

He was caught following liquidating his remaining bitcoins on an trade for $19,147,053 in January and February 2018. The unnamed organization froze his account and introduced an internal investigation that finally led to a lookup warrant. Haney was arrested in July 2019.

Initially, Haney claimed his bitcoin came from a mining operation. But investigators used “blockchain examination software” to present the cash came from Silk Street, according to the July criticism.

According to his plea deal, Haney pled guilty to just one depend of concealing cash laundering and just one depend of participating in a economical transaction in criminally derived assets. He is established to be sentenced in February 2020.

Handcuffs image through Shutterstock