Two U.S. Senators, Elizabeth Warren and Bill Cassidy, have asked the Biden adminstration to furnish them with updates on what the U.S. government is doing to curb the use of crypto in fentanyl trafficking. According to Warren and Cassidy, decentralized crypto exchange platforms are enabling the trafficking of Chinese-supplied fentanyl precursors. U.S. Senators Link Crypto […]
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OFAC’s Sanction Bucket Grows: BTC, TRX, and ETH Addresses Flagged Over Fentanyl Ties
The Office of Foreign Asset Control (OFAC) under the Treasury has released an updated version of the specially designated nationals (SDN) list, featuring multiple alleged fentanyl traffickers from China along with their associated cryptocurrency addresses. These highlighted crypto addresses are connected to decentralized networks such as Bitcoin, Ethereum, and Tron.
OFAC Targets Chinese Fentanyl Traffickers; Sanctions 17 Crypto Addresses
Continually broadening its database of crypto addresses linked to potential wrongdoers, OFAC identified 17 new addresses on October 3, 2023. Associated with blockchains like Bitcoin, Ethereum, and Tron, as well as digital assets like tether (USDT), these addresses were linked to a network of fentanyl suppliers primarily located in China but also connected to entities in Canada.
Chainalysis published a report on the topic, revealing that the addresses collectively received “.8 million worth of cryptocurrency.” Several individuals, including Bahman Djebelibak, Shen Xianbiao, Wang Jiantong, Zhang Wei, Xia Fengbing, and Wang Mingming along with the Canada-based company Valerian Labs, were sanctioned by OFAC.
According to Chainalysis’ study, Fengbing managed the crypto addresses for an organization called Jiangsu Bangdeya New Material Technology. The firm’s Reactor software found that the sanctioned addresses also had ties to numerous “mainstream exchanges.” Furthermore, a considerable portion of funds originated from darknet markets. This update follows OFAC’s recent sanctions on several BTC addresses allegedly related to Iran-linked ransomware activities.
In addition to the OFAC sanctions, the U.S. Department of Justice (DOJ) announced eight indictments against the ring of fentanyl, methamphetamine, and precursor chemical dealers. The indictments target the string of companies and individuals for openly advertising illicit chemical sales and using techniques to evade law enforcement. “We know that the global fentanyl supply chain, which ends with the deaths of Americans, often starts with chemical companies in China,” Attorney General Merrick Garland said.
What do you think about OFAC flagging 17 crypto addresses? Share your thoughts and opinions about this subject in the comments section below.
Treasury Sanctions Ethereum Wallet Used by Sinaloa Cartel to Launder Fentanyl Financing
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned an Ethereum wallet used by the Sinaloa Cartel to launder money from fentanyl sales in the U.S. Mario Alberto Jimenez Castro, an accused money launderer for the cartel’s Los Chapitos faction, allegedly directed the use of cryptocurrency and wire transfers to pay cartel leaders in Mexico, according to OFAC.
U.S. Treasury Targets Sinaloa Cartel Member’s Ether Wallet in Crackdown on Fentanyl Distribution
OFAC said Tuesday it sanctioned ten individuals, including several Sinaloa Cartel affiliates and fugitives, for contributing to the international proliferation of illicit drugs. In addition to sanctioning people, OFAC designated the Ethereum wallet with the address “0x9c2” used by Jimenez Castro.
“Jimenez Castro has directed U.S.-based couriers to pick up cash in the United States and deposit it into various virtual currency wallets for payment directly to the Chapitos and for reinvestment in fentanyl production,” OFAC said.
The Sinaloa Cartel is considered one of the most powerful drug trafficking groups in Mexico and is a major supplier of fentanyl in the U.S. OFAC said the sanctions target members of Los Chapitos, a faction run by the sons of imprisoned Sinaloa leader Joaquin “El Chapo” Guzman.
OFAC said the sanctions demonstrate “the [Biden] Administration’s strengthened approach to saving lives by disrupting the trafficking of illicit fentanyl and its precursors into American communities.”
The sanctions freeze any U.S. assets held by the Ethereum wallet and prohibit Americans from conducting transactions with the wallet. OFAC said it will continue targeting foreign drug traffickers contributing to the opioid epidemic through sanctions.
What do you think about OFAC sanctioning an ethereum wallet allegedly used by Sinaloa Cartel leader? Share your thoughts and opinions about this subject in the comments section below.
Former US Army Interpreter Gets 30 Years for Dark Web Fentanyl Trade
n Former U.S. Army interpreter sentenced to 30 years in jail for selling opiates using crypton
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US Federal Attorney: Bitcoin Used to Indict Suspected Fentanyl, Proves It is No Good for Evading Authorities
Another suspected dark web drug dealer is about to stand trail because he wrongly believed Bitcoin transactions were entirely anonymous. This has prompted the US Attorney for the Northern District of Texas, Erin Nealy Cox, to issue a warning for all those attempting to deal drugs online using Bitcoin.
In the early days of Bitcoin, it was widely touted as an entirely anonymous payment system. It is kind of difficult to see how this perception stuck, however, since all transactions have always been recorded on a publicly accessible ledger.
Suspected Fentanyl Dealer Busted Because of Bitcoin Use
According to a press release by US Immigration and Customs Enforcement a Dallas resident has been indicted on suspicion of dealing the deadly opioid fentanyl via the dark web.
Darknet fentanyl dealer indicted in Dallas for selling deadly drug for bitcoin https://t.co/oJDrz3vTop pic.twitter.com/Ch8ahqO1sg
— ICE (@ICEgov) May 29, 2019
The case has been a joint investigation by the US Immigration Enforcement, Homeland Security Investigation, IRS’s Criminal Investigation Division’s Los Angeles field office, and the US Postal Inspection Service.
Sean Shaughnessy, of Dallas, Texas, has been charged with conspiracy to possess with intent to distribute controlled substances, distribution of a controlled substance, distribution of a controlled substance analogue, and eight counts of money laundering. He could face up to 20 years in federal prison for each of the 11 charges against him.
The 51-year-old is believed to have posted fentanyl to customers in exchange for Bitcoin and other crypto assets. The ICE press release states that one of those buying the substance from Shaughnessy overdosed and died from taking it.
The release goes on to state that the suspect then transferred the crypto funds received to others in exchange for fiat that posted directly to him. However, Shaughnessy was unaware that he was actually sending Bitcoin and other crypto to wallets controlled by federal agents. He is believed to have sent over 0,000 in total. This is how authorities tracked him down.
US Attorney Neal Cox stated of the indictment:
“Dark net dealers often believe that by using bitcoin, they can evade authorities. This prosecution proves that’s not the case… We will continue to pursue anyone peddling this deadly drug — on the streets or online.”
Katherine Greer, Acting Special Agent in charge of Homeland Security Investigations, added:
“Our significant domestic and international HSI resources and expertise, along with the considerable resources of our law enforcement partners, provided an unbeatable team to investigate this fentanyl smuggling operation so that we could effect this indictment… This deadly drug – combined with the secrecy of bitcoin currency – represent a significant danger to an already-devastating national opioid epidemic.”
The numbers of criminals that have been brought to justice thanks to their belief that Bitcoin is entirely anonymous continues to grow. Blockchain forensics efforts from companies like Chainalysis and CipherTrace are becoming increasingly sophisticated, proving that Bitcoin is anything but the wonder currency for criminals it has often been portrayed as by the mainstream media and its most vocal critics.
Related Reading: Website Providing Links to Illicit Crypto Marketplaces Seized
Featured Image from Shutterstock.
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Crypto Exchange Creating Wallet Blacklist to Fight Fentanyl Crisis
A crypto exchange startup is seeking to blacklist wallets associated with illicit drug use in an attempt to use the blockchain to save lives.
CoinDesk
Bitcoin seized from alleged fentanyl kingpin now worth $8.5m and US officials want to cash in
US attorneys in Utah prosecuting a multimillion-dollar opioid drug-ring are moving quickly to sell seized bitcoin that’s exploded in value to about .5m.
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