New York Man Faces 25 Years in Prison for Bitcoin Money Laundering and Narcotics Scheme
A New York man is facing 25 years in prison, after being convicted by a federal jury in Brooklyn of money laundering and operating an unlicensed money transmitting business.
The unlicensed business the man was accused of operating was part of a scheme to launder money earned in bitcoin (BTC) from illegal drug trafficking, a press release from the U.S. Attorney’s Office for the Eastern District of New York said.
The convicted man was identified as 50-year-old Mustafa Goklu, also known as “Mustangy.”
The verdict followed a four-day trial in New York, and Goklu now faces a prison sentence of 25 years.
According to Breon Peace, U.S. Attorney for the Eastern District of New York, Goklu’s business offered customers the ability to launder proceeds from various criminal activities, while at the same time remaining anonymous and “conceal where their Bitcoin was coming from […].”
“With today’s verdict, Goklu’s illicit business of converting money from one form to another without a required license has been shut down and the defendant has been convicted for his crimes,” Peace said. He went on to thank the U.S. Drug Enforcement Administration’s New York Division for “outstanding investigative work on the case.”
Goklu’s arrest came after undercover law enforcement agents first noticed an advertisement posted on the peer-to-peer bitcoin trading platform LocalBitcoins.com where a user named “Mustangy” offered to purchase up to $99,999 worth of BTC. The undercover agents then proceeded to contact “Mustangy,” whose real name was Mustafa Goklu, and later met with him in person to sell bitcoin for cash.
Per the press release, the undercover agents reportedly indicated “on multiple occasions” that the source of the bitcoin they were selling was drug trafficking, but Goklu still completed the trade as agreed.
In total, Goklu and the undercover agents met on seven occasions over a nine-month period, which ended with Goklu’s arrest in April 2019.