Two men busted using BTC to conceal drug money

The US Department of Justice (DOJ) has charged a father-son duo from Monroe, Washington with using Bitcoin (BTC) to launder money for their illegal multi-million dollar marijuana business.

Father Kenneth John Rhule, 47, and son, Kenneth Warren Rhule, 28, were both sentenced to five years imprisonment after an ongoing investigation by the Department of Homeland Security and the Drug Enforcement Administration, which started in 2020.

US attorney Nick Brown said: “Not only did this pair produce and distribute marijuana products on the dark web, in violation of the state’s regulatory scheme, they also illegally laundered immense amounts of Bitcoin that their enterprise earned.

“When law enforcement moved in, there were more than a dozen firearms – some loaded and ready to be used to protect their drug trade.”

Rhule senior came to the attention of law enforcement in April 2018, when it noticed a screen name “Gimacut93” operating an unlicensed BTC exchange business.

An undercover agent met with Rhule over several months in public coffee shops in Western Washington, posing as a criminal in need of laundering funds for human trafficking activities.

Despite the request, Rhule agreed to exchange $142,000 worth of BTC for cash, and according to the DOJ even offered the undercover agent advice on the virtual currency with the additional help of how to illegally hide the source of funds.

The pair were arrested on March 11, 2020, when BTC was trading at $7,950.81 per coin, according to CoinMarketCap.

The DOJ said the operation has earnt more than $13m from customers nationwide, with a net profit of $2.5m.

The case was prosecuted by assistant US attorneys Krista Bush, Philip Kopczynski and Casey Conzatti.

You can use your crypto to enjoy recreational activities such as online gaming at websites such as 1xBit, FortuneJack and Bitcasino.

Source

Updated: 06/02/2022 — 11:00