United
States Attorney for the Southern District of New York Geoffrey S.
Berman announced the arrest of alleged dark web drug dealer Hugh Brian
Haney in a press release published on July 18.
Per
the release, Haney has been charged with money laundering. He allegedly
used cryptocurrency to launder more than $19 million of profits earned
selling illegal drugs on the now-defunct darknet market Silk Road.
Berman commented to the development:
“Today’s arrest
should be a warning to dealers peddling their drugs on the dark web that
they cannot remain anonymous forever, especially when attempting to
legitimize their illicit proceeds.”
Angel M.
Melendez, Homeland Security Investigations (HSI) special
agent-in-charge, pointed out that — after Silk Road was closed in 2013 —
cyber criminals simply sought other ways to “continue their criminal
activities and more importantly launder their illicit digital currency.”
Haney was allegedly one of those criminals. Melendez concluded:
“HSI
special agents employed blockchain analytics to uncover and seize
bitcoins valued at $19 million and usher Haney out of the dark web
shadows to face justice in the Southern District of New York.”
The
press release suggests that Haney operated on Silk Road under the
pseudonym Pharmville. U.S. law enforcement reportedly made multiple
controlled purchases of narcotics, including oxycontin, from Pharmville
in 2011 and 2012. Those purchases resulted in a judicially authorized
search of Haney’s house in Ohio in 2018.
The investigation
allegedly exposed evidence that Haney was a high-ranking member or
administrator of the Pharmville account. In 2017 and 2018, Haney
reportedly transferred his Bitcoin (BTC)
proceedings to a cryptocurrency exchange. In correspondence with the
exchange, Haney claimed to have obtained his BTC through mining and from
individuals he met online.
When Haney exchanged his
cryptocurrency for fiat currency and moved it into an HSI bank account,
the funds were seized pursuant to a judicially authorized seizure
warrant from a custodial account at a bank in the Southern District of
New York.
As Cointelegraph reported
earlier this month, $515 million in Bitcoin had been spent on illegal
activities in 2019 as of the beginning of July, but this only accounted
for 1% of total BTC transactions up to that point.
In May, German police, along with Europol, shut down servers of a dark-web marketplace and seized six figures in crypto from the arrested suspects.
source link
