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Hugh Brian Haney, a popular drug trader on the now–defunct Dark Web platform Silk Road, has been apprehended by authorities in New York.
The arrest was made public in a press release published by Geoffrey S. Berman, the United States Attorney for the Southern District of New York, in the late hours of Thursday. According to the release, Haney had allegedly used crypto assets as a conduit to launder about $19 million in profits that he got from drug dealing days on Silk Road.
Commenting on the release, Angel M. Melendez, a special agent with Homeland Security Investigators (HSI), added that the closure of Silk Road back in 2013 caused scores of cybercriminals to continue their criminal activities and launder their illicit digital currency via other means.
Speaking on how the arrest was made, Melendez revealed that investigators had employed blockchain analytics tactics to uncover Haney’s stolen, laundered funds, as well as fish him out.
The drug dealer reportedly used the moniker Pharmville while on Silk Road (quite fitting, since he sold drugs). To get him, authorities reached out to him and organized purchases of several narcotics, including Oxycontin, between 2011 and 2012.
Apart from a search of his Ohio home back in 2018, investigators also discovered that Haney had made Bitcoin transfers (reportedly, out of his earnings) to a cryptocurrency exchanges platform. However, when pressed on the sources of his crypto holdings, Haney claimed that he mined some, and he reached out to online sellers and retailers to buy cryptocurrency.
He summarily made crypto-to-fiat conversions of his assets and moved them into his account. Some few days after, the funds were seized. The drug dealer now faces one count of concealment money laundering, as well as a count of engaging in a financial transaction in a criminally derived property. The money laundering count carries a maximum of 20 years in prison, while the maximum jail term for the latter is a decade.
District Attorney Berman added, “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.”
Haney‘s arrest is the latest in Dark Web crackdowns, and it is sure to have traders and dealers of illicit materials running for the hills. The Wall Street Market, a popular platform on the Dark Web, was shut down by authorities back in April, and Bitcoin Blender, a foremost cryptocurrency “tumbler and mixing service,” abruptly shut down in May as well.
With all of these, it would seem that Dark Web operators are being stripped of their support gradually, and the prospect of imminent crackdowns is only going to get more real. It isn’t the best time to be a cryptocurrency criminal.
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