Five Drug Dealers Who Used Crypto Sentenced to Prison

U.S. district courts have sentenced five drug dealers, who used cryptocurrencies to evade authorities and conduct illegal transactions, to prison sentences ranging from 5 to 20 years. Four of the criminals were sentenced in Arizona, while a fifth, Wyatt Pasek, based in California was sentenced to 17.5 years for drug-related offenses.

A False Sense of Security

According to the Department of Justice release, the four Arizona drug dealers used the vendor name “Iceman21” to advertise and distribute meth, heroin, and cocaine on the dark web. They used the US Postal Service to ship their drugs from Phoenix, AZ to various destinations in the US. The US Postal Inspection service seized parcels containing the controlled substances during routine inspections.

To conceal their illegal drug operation, the four used encryption, cryptocurrency, and created bank accounts for fake businesses. Federal authorities also seized a huge collection of firearms, a Super Bowl XL ring, and various platinum, silver, and gold bars from them.

A DEA Special Agent for Arizona said the drug dealers were under a false sense of security because they used the dark web. He said that their successful prosecution demonstrated criminals working online would eventually be found.

An “Oxygod” with Crypto

Separately, Wyatt Pasek, a 22-year-old from California, was sentenced to 210 months (or 17.5 years) in prison by a district judge for the Central District of California. He was accused of using fentanyl and other opioids to produce and sell counterfeit drugs that were designed to look like oxycodone. At the time of his arrest in April 2018, he was living in a luxury penthouse.

Pasek called himself “oxygod” online while looking for customers in various online marketplaces. On social media, he posted videos and images of himself using the name Yung10x. He pleaded guilty to being involved in a drug-trafficking operation, money laundering, and owning a firearm while being a convicted criminal. He forfeited various items to the government including over $21,000 in cash, a gold and diamond Bitcoin necklace, two gold bars, and thousands of dollars in cryptocurrency that were found in his crypto wallet.

The prosecutions come hot on the heels of a pair of advisories that were issued by the White House on August 21. The advisories specifically addressed the use of crypto in drug trafficking and advised financial institutions and digital payment platforms to be on the lookout for criminals who might seek to abuse their systems for their illicit activities. This is not the first time federal authorities are going after drug dealer using crypto. A man in LA pleaded guilty to running an unregulated crypto operation. The investigations revealed that he had been using his operation to launder the proceeds of crime, including money from drug dealers.