Silk Road seller pleads guilty to Money Laundering: Laundered $19 million via Bitcoin

Former drug dealer admits to Money laundering. Confesses that he had laundered 19 million US dollars through Silk Road.

Hugh Haney pleads guilty to money laundering

The US Department of Justice revealed that the prosecutors from the Southern District of New York had announced a plea deal with Hugh Brian Haney. This has added yet another script on the drug market’s history. According to the announcement, Hany was accused of laundering nearly 20 million dollars in early 2018.

Silk Road was one of the earliest drug markets that surfaced on the dark web and has been accepting crypto assets such as Bitcoin from way back. The site was shut down in 2013 when its creator and operator Ross Ulbricht was arrested. Ross faced several charges and is serving a life sentence for selling drugs, conspiracy and cyber crimes such as computer hacking.

Haney was one of the ‘vendors’ at the market that sold drugs at the site. Allegedly, Haney was a high-ranking member of a drug-dealing group called Pharmville and received over 4,000 Bitcoins from Silk Road accounts in February 2012. The complaint claimed that Haney supplied fentanyl, oxycontin among various other drugs.

US Attorney Geoffrey S. Berman claims that Haney utilized Silk Road as “a means to sell drugs” to buyers across the globe. He added that then, Haney was involved in money laundering as he used Bitcoins to launder over 19 million dollars that he collected as profit at the marketplace.

Haney was caught after trying to liquidate his remaining Bitcoins on a crypto exchange for 19,147,053 US dollars in early 2018. The exchange then froze his accounts and initiated an internal investigation that led to a search warrant. Haney was finally arrested in July 2019.

He initially claimed that the Bitcoins came from Bitcoin mining, but blockchain analysis revealed that his funds came from Silk Road. Now he has pleaded guilty to money laundering as well as one count of engaging in financial trade of illegally derived property. He is set to be sentenced in February next year.