Holly Danielle Adams, 34, from California, has pleaded guilty to charges of drug distribution conspiracy and money laundering via cryptocurrency mixers. This case stems from an investigation by the Northern California Illicit Digital Economy (NCIDE) Task Force, a federal team dedicated to combating all forms of illegal dark web and cryptocurrency activities in the Eastern […]
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US Jury Convicts Two in $8M Crypto-Linked Dark Web Drug Scheme
A federal jury in Salt Lake City convicted Oluwole Adegboruwa and Enrique Isong, foreign nationals, of multiple drug-related charges. From 2016 to 2019, they generated over million in cryptocurrency, including bitcoin and ethereum. Adegboruwa operated under the names “King Odua” and “Alagbada726,” converting cryptocurrencies to traditional currency. Sentencing is scheduled for August. The jury […]
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Cartier Family Member Indicted for Using USDT to Launder Hundreds of Millions in Drug Trafficking Money
Maximilien De Hoop Cartier, a descendant of the family famous for their French luxury goods Cartier, has been indicted for his participation in a network that allegedly used several shell companies to launder drug trafficking money proceeds using USDT. Cartier and five Colombian individuals allegedly conspired to directly launder .5 million and used these shell […]
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Washington Court Convicts Bitcoin Fog Founder of Aiding Darknet Drug Trade Money Laundering
In a recent development, the founder of “Bitcoin Fog,” a cryptocurrency-mixing service, was found guilty by a federal jury in Washington of helping to launder tens of millions of dollars from darknet markets notorious for illegal drug sales.
Multi-Million Dollar Crypto Money Laundering Case
According to a Bloomberg report, Roman Sterlingov, a 35-year-old Russian-Swiss national, was convicted by a jury on multiple counts, including conspiring to money launder, money laundering, and failing to register a money transmitting service. The prosecution argued that Bitcoin Fog facilitated over 0 million in untraceable transactions, with some funds originating from illicit markets.
The verdict not only marks another victory for the United States in its crackdown on crypto criminals but also sheds light on the role of Chainalysis, a Wall Street-backed firm utilized by the Justice Department and Treasury Department to trace cryptocurrency flows in money laundering cases. The defense raised concerns about the reliability of Chainalysis during the trial, questioning its methods and credibility.
During the month-long trial, prosecutors presented evidence showing how they tracked the flow of crypto from darknet markets through Bitcoin Fog, which they claimed Sterlingov operated. The government also relied on testimony from other crypto criminals, including Ilya Lichtenstein and Larry Harmon, who testified about using mixers for money laundering purposes.
Bitcoin Fog Founder Maintains Innocence Despite Conviction
Sterlingov, who has consistently denied running Bitcoin Fog, testified that he allegedly worked in information technology and helped clients create domain names during his employment at a marketing and web firm.
Furthermore, Sterlingov claimed that he did not recall creating the Bitcoin Fog domain name or engaging in certain transactions referenced by the government.
Defense attorney Tor Ekeland also claimed that there was no concrete evidence linking Sterlingov to the operation of Bitcoin Fog, emphasizing a lack of eyewitness accounts or server logs.
Ekeland also questioned the logic of using a secretive multi-step process to fund Bitcoin Fog when the initial transaction originated from an account registered in Sterlingov’s name. Sterlingov now faces a potential prison sentence of up to 20 years for the most serious charges.
As of the latest update, Bitcoin, the largest cryptocurrency in the market, experienced a minor 2% correction, briefly dipping to ,500 and temporarily falling below the significant ,000 milestone. However, the cryptocurrency swiftly rebounded and is currently trading at ,400 at the time of writing.
Despite this temporary correction, Bitcoin has still exhibited notable gains of 11%, 25%, and 48% over the past seven, fourteen, and thirty days, respectively. These substantial increases propelled BTC to achieve its recent all-time high (ATH) of ,000, which was reached on Monday.
Featured image from Shutterstock, chart from TradingView.com
Australian Police Officer in Court for Stealing Nearly 82 BTC From Seized Drug Trafficker’s Wallet
An Australian police officer recently appeared in a Melbourne court where he faced charges of stealing 81.616 bitcoins from a crypto wallet seized from drug traffickers. After initially blaming the drug traffickers,’ the Australian Federal Police later reopened the case after an expert found evidence linking the theft to a former police officer. The accused […]
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US Authorities Confiscate $54 Million In Ethereum From Convicted Drug Dealer
In recent developments, US authorities led by US Attorney Philip R. Sellinger successfully seized million worth of Ethereum (ETH) from Christopher Castelluzzo, a convicted drug dealer operating in Lake Hopatcong, New Jersey.
Massive Crypto Bust
The US Attorney’s Office filed a civil forfeiture action to recover previously seized cryptocurrency that was determined to be the proceeds of an illegal narcotics distribution scheme operating in and around New Jersey.
US Attorney Philip R. Sellinger emphasized law enforcement’s “commitment” to seizing financial gains from criminal activity, regardless of the form they take. Sellinger further stated:
The civil action we are taking today seeks to recover millions of dollars of cryptocurrency, which the defendant allegedly obtained from drug sales. Whether it’s as simple as bags of cash or as sophisticated as cryptocurrency, we will take the steps necessary to seize financial gains defendants obtain from criminal activity.
According to the US Department of Justice’s (DOJ) press release on the case, the prosecution sheds light on using cryptocurrencies such as Bitcoin (BTC) and Ethereum by criminals on the darknet to evade detection.
In addition, James E. Dennehy, Special Agent in Charge of the Federal Bureau of Investigation (FBI) in Newark, stated that the FBI played a critical role in uncovering the illegal conduct and ill-gotten proceeds.
Drug Trafficker’s Ethereum Stash Seized
According to court documents and the investigations conducted, Christopher Castelluzzo and his associates conspired to sell narcotics between 2010 and 2015.
In 2013, they allegedly began trading drugs on darknet platforms in exchange for Bitcoin. Castelluzzo, using proceeds from narcotics sales, participated in Ethereum’s Initial Coin Offering (ICO) in July 2014, acquiring 30,000 Ethereum. Additionally, Castelluzzo received 30,000 ETH Classic in 2016.
Castelluzzo’s plan to move the funds to a tax haven in Ireland, Malta, or the Bahamas, or potentially keep them in USDT (Tether), was revealed in forfeiture documents.
However, a subsequent search warrant led to the raid of Brian Krewson’s residence, an associate of Castelluzzo. Police discovered the relevant crypto wallets under Krewson’s control, and after obtaining the necessary passwords, law enforcement executed the seizure of the Ethereum, valued at million at the time.
Currently serving concurrent 20-year federal and state prison sentences for drug distribution convictions, Castelluzzo attempted to evade taxes and transfer the 30,000 Ethereum out of the United States while incarcerated.
However, Castelluzzo’s plans were intercepted when recorded prison telephone calls exposed his efforts to launder the cryptocurrency. As a result, the United States intervened and seized Castelluzzo’s cryptocurrency holdings linked to his drug trafficking crimes.
The current value of the 30,000 Ethereum stands at approximately million, underscoring the significant impact of the seizure.
As of the time of writing, ETH is trading at ,815, reflecting a 0.9% increase over the past 24 hours and a steady upward trend of over 2% in the past seven days, exhibiting strong bullish momentum in the market.
Featured image from Shutterstock, chart from TradingView.com
Report: Australian Police Seize Crypto Worth $1.5 Million From Dark Web Drug Dealer
The police in the Australian state of South Australia recently seized cryptocurrency worth .5 million from an alleged dark web drug dealer. Police also recovered a “large quantity” of the synthetic opioid nitazene as well as tens of thousands of dollars in cash.
‘Illicit Activity on a Dark Web Marketplace’
Police in South Australia, a state in the southern central part of Australia, recently seized cryptocurrency worth .5 million from an alleged dark web drug dealer. According to an ABC News report, law enforcement also confiscated a “large quantity” of drugs and electronic devices from an unnamed 25-year-old man.
Explaining how the operation against the alleged drug peddler was carried out, Adam Rice, the South Australian Detective Superintendent, said:
“The investigation identified illicit activity on a dark web marketplace, attributed that activity to a real-life person in South Australia, identified and traced cryptocurrency used in the offending and then ultimately led to a successful search and seizure operation.”
Among some of the drugs seized during the raid on a residential house and two storage units was a synthetic opioid known as nitazene. Authorities in the state are concerned the drug, which is highly toxic and has never been approved for human consumption, could be linked to two overdose cases in which one person died.
Meanwhile, the report also revealed that law enforcement officers also recovered tens of thousands in cash when they raided premises in Adelaide Hills.
What are your thoughts on this story? Let us know what you think in the comments section below.
Crypto Drug Cartel Ties: On-chain Investigator Drags Ethereum Into The Mess
An on-chain crypto investigator took to social media to expose the supposed black truth behind Justin Sun’s Tron but has thrown Ethereum in the mix, alleging that the cryptocurrency is backed by the CCP and may harbor crypto wallet addresses by Fentanyl traffickers.
On-Chain Detective Unveils Potential Tron Ponzi Scheme
An X (formerly Twitter) user going by the username @BoringSleuth has gained the attention of the crypto community after uncovering potential evidence of Tron allegedly being a Ponzi scheme governed by one of the world’s largest crypto criminal drug cartels.
“I showed and told the World that Tron $TRX was a massive Ponzi, run by a part of the largest criminal Cartel in the World, and connected to the CCP,” BoringSleuth said.
I showed and told the World that Tron $TRX was a massive Ponzi, ran by a part of the largest criminal Cartel in the World, and connected to the CCP.
Today, the DOJ charged 8 CCP companies with illegal drug production, distribution, and sales around Fentanyl. Over half of their… https://t.co/Yjbnv2fgPN pic.twitter.com/do4JLiAgLh
— TruthLabs
(@BoringSleuth) October 4, 2023
BoringSleuth disclosed that the United States Department of Justice (DOJ) has sanctioned eight Chinese Communist Party (CCP) companies for allegedly operating a clandestine drug production and distribution sales network around Fentanyl.
The crypto investigator revealed that more than half of the wallets owned by these companies were traced back to Tron and the remainder allegedly being on the Ethereum blockchain.
After analyzing the original sales of the TRX token, BoringSleuth stated that he had reviewed the top 20 cryptocurrency wallets in Tron’s original token sale list to decipher the owners of the wallets and how much TRX supply these wallets have acquired.
According to the investigator, out of the 20 wallets, 17 were created and owned by the infamous criminal organization disguised to represent genuine investors. He revealed that the criminal organization was connected to the CCP, and 98% of Tron’s total token supply was received by these 17 wallets.
The on-chain investigator also mentioned that cryptocurrency exchanges like Huobi Global, and cryptocurrencies like Shiba Inu may also be linked to the CCP and Wanxiang, a Chinese multinational conglomerate and the team that funded Ethereum Foundation wallets and Ethereum’s Founder, Vitalik Buterin.
Investigations Cast Shadows On Ethereum
The crypto industry has experienced a series of Ponzi schemes and rug pulls for years now, causing investors and regulators to be wary of crypto exchanges and organizations in the space.
While Tron is faced with speculations of being a well-orchestrated Ponzi scheme and having connections with the CCP, the revelation that Ethereum, the world’s second-largest cryptocurrency may be backed by the CCP and connected to companies involved in drug trafficking has left the crypto community in a paradox.
According to BoringSleuth, the CCP is allegedly supporting Ethereum and other blockchains as well as multiple Decentralized Exchanges (DEX) and Centralized Exchanges (CEX) in the crypto space.
The crypto investigator utilized a previous transaction that saw the CCP receiving 133,700 ether on a single Genesis Block address owned by the party, as a reference to a connection between Ethereum and the CCP.
BoringSleuth has also stated a potential connection between Ethereum’s Founders and the CCP, which he said he would be revealing in detail soon.
The allegations faced by Tron and Ethereum come amid the increasing scrutiny of China’s role in the cryptocurrency landscape. Although the crypto X community is presently reeling from the on-chain investigator’s hypothesis, no concrete evidence linking Ethereum to the CCP has emerged, leaving the allegations in the realm of speculation.
Judge Limits Bankman-Fried’s Trial Arguments; Allows Recreational Drug Use Questions
A federal judge has issued rulings limiting some arguments the defense can make at Sam Bankman-Fried’s criminal fraud trial next month. However, the judge will allow Bankman-Fried’s lawyers to question witnesses about past recreational drug use.
Bankman-Fried Can’t Mention Jail Time at Trial
In a 16-page order, Lewis Kaplan, the U.S. District judge presiding over the case granted some of prosecutors’ requests to bar certain defense strategies and evidence at the October trial of the FTX cryptocurrency exchange founder. Kaplan prohibited Sam Bankman-Fried‘s lawyers from telling jurors he’s been detained pretrial or referencing his family and personal life.
The judge also barred arguments over whether FTX customers were negligent in using the exchange or that Bankman-Fried intended to pay back any allegedly stolen funds. Kaplan wrote both are irrelevant or unfairly prejudicial.
However, Kaplan declined to prohibit Bankman-Fried’s lawyers from asking witnesses about recreational drug use. Prosecutors claimed it would harass witnesses and prejudice jurors. Kaplan said the defense must notify him and the prosecutors before raising it.
The rulings came on dueling requests from prosecutors and defense lawyers to limit arguments and evidence at the New York trial, which follows the alleged multibillion-dollar fraud that caused Bahamas-based FTX’s collapse in November 2022.
Bankman-Fried, 30, has pleaded not guilty to charges he defrauded investors and looted customer deposits on FTX, cheating customers out of billions. He was originally freed on 0 million bond but the bond was revoked.
Judge Says Government’s FTT Market Manipulation Evidence Is Admissible
Kaplan also said that the alleged tampering with the cryptocurrency tokens, which supposedly altered Alameda Research’s financial records, was a direct action taken as part of the claimed secret plan or conspiracy. Thus, Kaplan believes the claimed tampering is directly linked to the main accusation in the case.
Additionally, the claim that the defendant instructed the former CEO of Alameda Research, Caroline Ellison, to change the price of FTT shows that they had a close and trusting relationship. Kaplan stressed the importance of this information in proving the case is greater than any potential bias it might cause, so he’s allowed it as evidence in the trial.
Kaplan wrote the ruling after reams of pretrial motions from prosecutors and defense lawyers aiming to tilt the playing field in their favor. Furthermore, Bankman-Fried’s lawyers have attempted to get him released before the trial for the third time in a row.
Jury selection is set for October 3, 2023, with opening statements likely in late October.
What do you think about the upcoming trial against Bankman-Fried? Share your thoughts and opinions about this subject in the comments section below.
Sweden Government Pays Convicted Drug Dealer $1.5 Million In Bitcoin
The government of Sweden has found itself in the unusual situation of paying out around .5 million worth of Bitcoin to a drug dealer, whom they convicted and then jailed. Authorities are being forced to pay the man 33 BTC, after his illegally obtained bitcoin appreciated while behind bars.
A Swedish Prosecutor’s Mistake
Two years ago, a Swedish court convicted the man for selling drugs online and illegally earning 36 BTC from those sales. However, his prosecutor at the time, Tove Kullberg, used the fiat value of the coin to make her initial case.
And as a result, the court judged that the man’s illicitly earned Bitcoin should be seized, at its then-value of 1.3 million Swedish kronor (0,000). This mistake led to the court having to pay .5 million to the drug dealer upon his release.
Related Reading | Bitcoin Poised To Explode Above K?, Why Fundamentals Shout More Profits
In the two years following the man’s conviction and imprisonment, the price of bitcoin has skyrocketed. His crypto stash had appreciated significantly to more than .5 million. To satisfy the court’s original settlement of 0,000, the Swedish Enforcement Authority needed to sell off just 3 BTC. That leaves 33 BTC, worth .5 million, left from the criminal’s wallet that they must now return. The Swedish Government would have avoided this problem entirely if they had sold the 36 coins at the time of incarceration. Alternatively, if the prosecutor had reported the funds in crypto instead of dollars.
Tove Kullberg’s Reaction
Speaking to Swedish radio, Kullberg admitted that the way she chose to go about reporting the funds in dollars and not crypto was a mistake. She describes it as “unfortunate in many ways. It has led to consequences I was not able to foresee at the time.” She also added, “The lesson to be learned from this is to keep the value in Bitcoin, that the profit from the crime should be 36 Bitcoin, regardless of what value the Bitcoin has at the time.” She continued that the mistake came about because this was the first time this type of case had been seen in Swedish legal history.
BTC price now trending at almost ,000 | Source: BTCUSD on TradingView.com
Kullberg also stressed the importance for the government to educate its workforce about the details of the crypto industry, and how it factors into court rulings. “The more we increase the level of knowledge within the organization, the fewer mistakes we will make.”
This case is a typical example of how cryptocurrencies continue to challenge legal authorities. Governments, all over the world, have been trying to understand the volatile and technical nature of cryptos. And find ways to integrate it into the legal systems.
Featured image from CoinGeek, Chart from TradingView.com
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