New York takes down dark web ring linked to crypto-related laundering
The Manhattan District Attorney has indicted three individuals who were found to have been selling counterfeit drugs on the dark web. The three, Chester Anderson, Ronald McCarty, and Jarrette Codd, sold and shipped the drugs to 43 states in the U.S., using Bitcoin Core (BTC) to launder over $2.3 million, according to a press release by the District Attorney’s Office.
The DA had the help of the Secret Service, the U.S. Postal Inspection Service and Homeland Security. Together, the team made a series of undercover purchases on the dark web store. The investigators paid in crypto, purchasing over 10,000 Xanax pills over the time of the investigation. Unknown to the defendants, with every purchase, the team of investigators was pinning down their location. The team received assistance from Manhattan’s Cyber Lab.
District Attorney Cyrus Vance warned other criminals who were also using cryptos to operate their underground crime rings, saying: “Not only is this the first time state prosecutors in New York have taken down a dark web storefront, this takedown represents the largest pill seizure in New Jersey’s history. If you are engaging in illicit activity on the dark web, you are on notice: we know how to find you, we know how to put you out of business, and we know how to hold you criminally accountable.”
Anderson was charged as the main culprit. According to the indictment, he operated a dark web store using the screen name ‘SINMED.’ The other two defendants were accomplices in his crime, assisting with the procurement of equipment and manufacturing of the illicit substances. The indictment further states that the defendants created a shell company named Next Level Research and Development. They used this company to purchase the ingredients they used to develop the fake tablets.
The three are alleged to have laundered over $2.3 million using BTC. Once they received the payment in crypto, they would load prepaid debit cards which they would use to withdraw money from ATMs. At the time of the investigation, the suspects reportedly withdrew over $1 million from ATMs in New Jersey and Manhattan.
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as SegWitCoin BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins. Altcoins, which value privacy, anonymity, and distance from government intervention, are referenced as dark coins.
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