A man from Maryland has been charged with laundering 2,933 Bitcoin (BTC), worth around $139 million, from a US prison cell.
Ryan Farace, 37, has been accused by federal prosecutors of laundering money while serving a 57-month prison sentence for selling drugs on the dark web.
Originally convicted in 2018, Farace was previously ordered to forfeit 4,000 Bitcoin, worth about $189 million at time of writing, and an additional $5.6 million in cash and property.
Farace reportedly operated under the moniker “Xanaxman” while selling Alprazolam, a generic form of the sedative drug Xanax.
According to the U.S. Attorney’s Office in the District of Maryland, Farace used a pill presser to turn the Alprazolam into more than 920,000 counterfeit Xanax pills between November 2013 through June 2017. Farace then reportedly worked with a co-conspirator named Robert Swain to use Bitcoin to launder his proceeds.
“Specifically, Farace used pseudonyms to contact a co-conspirator through dark web marketplaces and encrypted messages in order to exchange Bitcoin he received from his drug trafficking for cash. The co-conspirator would then mail or ship packages of US currency equivalent to the value of the Bitcoin received, less a fee, to mailing addresses provided by Farace…
During the course of the conspiracy, Farace received cash totaling more than $5 million, through the mails, which he had exchanged for Bitcoin earned from drug trafficking. In addition, Farace and Swain drove to New Jersey so that Swain could collect $200,000 in cash that Farace had exchanged for Bitcoin. During the in-person meeting on February 16, 2017, Swain provided a fictitious name to the individual he met and falsely stated that the Bitcoin and cash were his own. Farace and Swain later tried unsuccessfully to exchange Bitcoin for $400,000 in cash with the same individual.”
According to a report from the Baltimore Sun, the new indictment alleges that Farace and his father, Joseph Farace, laundered funds from drug operations between October 2019 and April 2021 while detained in prison.
The indictment does not specify whether the recently seized crypto assets were among the proceeds Farace was ordered to forfeit or whether they were assets that the government had not previously detected.
Featured Image: Shutterstock/Alex Volot