Silk Road seller pleads guilty to money laundering via BTC

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A former Silk Road trader has pleaded guilty to money laundering charges, the U.S. Department of Justice has revealed. Hugh Brian Haney pleaded guilty in a Manhattan court of laundering at least $19 million in proceeds from a drug trafficking operation on the dark web. Haney now faces thirty years in prison for his crime.

The U.S. Attorney for the Southern District of New York, Geoffrey Berman, announced the guilty plea, bringing to an end a process that started in July this year when Haney was arrested. The authorities accused Haney of being one of the prominent members of Pharmville, a prominent narcotics vending ring on the infamous dark web marketplace Silk Road.

Haney denied the charges at the time. However, after a search of his house, the authorities found incriminating evidence including a document titled ‘HBH DAILY TO DO LIST’. This document contained detailed information on Silk Road, Pharmville and other narcotics operations, including the sale of opioid fentanyl.

The authorities also found that in 2017 and 2018, Haney transferred BTC that was earned from his operations selling narcotics on Silk Road. He sent them to an account he held at a crypto exchange from the BTC account linked to his Silk Road operation. At the time, Haney claimed that he had rightfully earned the money from fair trading activities. The BTC was worth over $19 million.

The Ohio native pleaded guilty to one count of concealment money laundering, which carries a maximum sentence of 20 years in prison. He also pleaded guilty to one count of engaging in a financial transaction in criminally derived property, a crime which carries a 10-year maximum sentence. His sentencing is scheduled for February 12, 2020.

Manhattan U.S. Attorney Berman cautioned anyone selling drugs on the dark web, stating, “Hugh Haney used Silk Road as a means to sell drugs to people all over the world. Then he laundered more than $19 million in profits through cryptocurrency. Peddling drugs on the Dark Web does not provide anonymity forever, as Hugh Haney can attest.”

Prosecutors have become better at monitoring the dark web for illegal activities. Recently, a San Diego man received 70 months for drug dealing on the dark web. As CoinGeek reported, the man had sold millions of dollars on such marketplaces as AlphaBay and Trade Route.