One of the most prominent drug vendors on the infamous Silk Road dark web marketplace was recently arrested, after attempting to launder $19 million in profits made on the site.
Last week, United States Attorney for the Southern District of New York, Geoffrey S. Berman, issued a press release announcing the arrest of 60-year-old Hugh Brian Haney from Columbus, Ohio.
Haney reportedly ran on online shop on the Silk Road selling a variety of prescription pharmaceuticals, earning millions in revenue in just a few years.
Berman warned that this arrest should serve as a reminder that drug vendors on the dark web are not safe from police. Berman said:
Working side by side with our law enforcement partners, our Office has shut down Silk Road, the secret online marketplace for illegal drugs, hacking services, and a whole host of other criminal activity. As alleged, Hugh Haney used Silk Road as a means to sell drugs to people all over the world. [...] 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.”
The investigation also involved agents from the Department of Homeland Security, who used blockchain analysis tools to track Bitcoin that was earned on the Silk Road.
Homeland Security Investigations (HSI) special agent-in-charge, Angel M. Melendez said that drug web drug vendors are often getting caught up on the exit ramps, where they attempt to trade cryptocurrency into fiat.
HSI special agents employed blockchain analytics to uncover and seize bitcoins valued at $19 million and usher Haney out of the dark web shadows to face justice in the Southern District of New York.
According to the press release, Haney was one of the primary administrators for a Silk Road shop called "Pharmville," which sold a variety of prescription pharmaceuticals, including oxycontin. Since no drugs were found in a search of Haney's home, they were not able to pin any drug charges on him.
However, they did have enough evidence to charge him with one count of concealment money laundering, which carries a maximum sentence of 20 years in prison. He was also charged with one count of engaging in a financial transaction in criminally derived property, which carries a maximum sentence of 10 years in prison.
The biggest seller on the Silk Road, Jon Slomp is currently serving a 10-year prison sentence. Ross Ulbricht, the alleged creator of the site, was sentenced to two life terms, plus 40 years, without the chance of parole, despite the fact that he didn't sell any drugs.