Fake Xanax. Guns. Cryptocurrency. Dark web drug dealers hid them all in Detroit house
As a helicopter swirled above, Carolyn Hernandez-Taylor went about her business at her brother's house, hauling garbage bags from a back door to her car.
The bags were filled with fake Xanax, a dangerous, so-called "designer benzo" known as clonazolam, a research drug that's illegal and unfit for human consumption, yet alarmingly popular, the government says.
Busting those who sell it can be difficult because it's typically peddled on the dark web, not street corners. That's what Taylor and her brother did, court records show, though they weren't as elusive as they thought.
The helicopter caught them in action.
In U.S. District Court this month, Taylor, 29, of Detroit, pleaded guilty to running a clandestine drug lab out of her brother's Detroit house, where Homeland Security agents last year seized thousands of counterfeit Xanax pills, 600 grams of cocaine, guns, $1 million in cryptocurrency, $340,000 in cash, and an industrial size drug mixer and pill press. The machines could make up to 20,000 pills per hour, court records show.
How the dark web operation worked
The house was on Florida Street, and served as a distribution hub for a cocaine and counterfeit pill operation that for years went by the name "opiateconnect" on the dark web marketplace, authorities said. According to federal investigators, opiateconnect had been a dark web drug vendor since at least 2016, though it wasn't until 2018 that Detroit's Dark Web Task Force with Homeland Security Investigations identified Taylor's brother as being the operator of the website.
At her guilty plea hearing on Wednesday, Taylor admitted that from 2019-2022 she helped run this drug trafficking operation, which involved her picking up drugs from her brother's house, delivering them to an associate, who would then mail them to customers across the United States from the Lincoln Park post office.
"Investigative findings have identified Taylor as one of the most active members of the opiateconnect organization," a Homeland Security agent wrote in an affidavit. "Taylor has been routinely observed spending considerable amounts of time, multiple days per week, at the suspected drug processing/packaging location used by opiateconnect."
Taylor admitted to this in her plea agreement, which states: "Taylor was responsible for recruiting individuals to deliver packages/parcels of drugs to the post office."
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Unbeknownst to Taylor, however, investigators were on her tail, and watched her leave the drug house with the garbage bags in her Ford Fusion, and load them into her associate's Jeep Patriot — sometimes in alleys, other times at her associate's house in Lincoln Park.
Surveillance was also conducted on the associate, who was seen mailing the packages at the post office, where federal investigators retrieved the packages and tested the contents, "all of which contained drugs sold by opiateconnect, including cocaine and pressed Xanax," the affidavit states.
Taylor and her brother were charged with multiple drug crimes in a January indictment, which said the operation ran from 2019-2022. The associate who delivered the pills was not named in the indictment. Attorneys for Taylor and her brother could not be reached for comment.
“Counterfeit pills pose a unique danger to this community, especially ones that have the appearance of a drug that is so regularly prescribed," U.S. Attorney Dawn Ison stated in announcing Taylor's guilty plea. “We will continue to investigate and aggressively prosecute instances where those counterfeit pills are manufactured illegally and distributed in our district to keep our community safe.”
Brother still jailed
Taylor is out on bond as she awaits sentencing for her crime in October. She faces a mandatory minimum of five years in prison, and a maximum of 40 years.
Her brother, Victor Hernandez, remains jailed pending the outcome of his case. At the request of the prosecution, a judge ordered Hernandez be detained, concluding he is a flight risk and a danger to the community.
While jailed, Hernandez asked to be temporarily released on a tether to attend his brother's funeral — though the prosecution objected on numerous fronts, arguing:
"Hernandez was the leader and organizer of a substantial drug trafficking conspiracy. A search of his residence revealed industrial size pill press machines and mixers," Assistant U.S. Attorney Robert White wrote in a May court filing, adding: "Hernandez is a felon, with a prior conviction for drug trafficking, and had loaded firearms throughout the home, including a rifle with a bump stock modification."
Moreover, the prosecutor argued, Hernandez "had access to large sums of illegitimate proceeds, and not all of it was recovered." And given that he was dealing with cryptocurrency — which is difficult to trace — it would be "nearly impossible to say for certain the amount of the outstanding funds" he has available, he wrote.
The judge denied Hernandez's request to attend his brother's funeral.
"The Court sincerely empathizes with Mr. Hernandez over the loss of his brother," U.S. District Judge Linda Parker wrote in her order. "However, due to the seriousness of the pending charges against Mr. Hernandez ... the Court finds that a tether is not a viable option and no condition or combination of conditions of release are available ... that would reasonably assure the safety of any other person and the community."
Feds go undercover on dark web
According to court documents, federal agents made multiple undercover buys from opiatenet to help bust the operation. For example, on Feb. 18, 2022, investigators initiated an undercover purchase of cocaine from opiateconnect. The purchase was for 3.5 grams of cocaine for $275, plus $10 shipping. The purchase was made with bitcoin.
That same day, the task force initiated surveillance near the Florida Street drug lab, and the home of the associate who delivered the organization's drugs to the post office. They would eventually see Taylor meet her associate in an alley. Trunks opened and closed. The two then drove to the Lincoln Park post office, where the associate exited her Jeep and retrieved two large, full trash bags from the rear hatch area.
She entered the post office, mailed dozens of parcels and left.
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Immediately after, a federal agent entered the post office and reviewed dozens of packages, including one addressed to the undercover officer who had bought cocaine with bitcoin.
In the package was cocaine.
The task force would conduct numerous more undercover buys, and inspect the packages as they showed up at the Lincoln Park post office, where they would find parcels containing cocaine and green pills, which turned out to be clonazolam. Continuous surveillance of Taylor's Ford Fusion, the Florida Street house and the post office would trigger an eventual raid of the house.
On Aug. 23, 2022, the Detroit Dark Web Task Force entered the home with a search warrant, and found what they suspected was there: cocaine, counterfeit Xanax, pill press machines, mixers and cryptocurrency.
According to the Centers for Disease Control and Prevention, one of the many dangers of clonazolam its resistance to drugs used to reverse overdoses. For example, naloxone will reverse opioid overdose symptoms, but not clonazolam, leading to risk for respiratory failure or death.
Still, the demand for this designer drug is high, though officials believe they're making some headway in catching and prosecuting those who are selling it online.
In Florida, a Cape Coral man pleaded guilty on June 22 to running a counterfeit drug operation out of his home, where federal agents found a five-gallon bucket filled with 30 pounds of counterfeit Xanax pills — which actually contained clonazolam — a bucket containing 20 pounds of a pill binding agent and pill dyes. They also found a large commercial-grade pill press in the garage, and hundreds of counterfeit oxycodone pills on a nearby shelf containing fentanyl.
In Virginia, a Virginia Beach man pleaded guilty in 2021, to dealing counterfeit Xanax pills on the dark web following a federal raid of his home, where investigators found 2,400 grams of white pills, two glass containers with white powder and packing material. The pills were clonazolam. The white powder contained cocaine.
In 2020, a California man pleaded guilty to smuggling illegal drugs into the U.S. — including clonazolam — pressing them into pills and then selling them to customers across the country through his online business Domestic RCS. He admitted knowing the pills carried risks of dependency, toxicity, and fatal overdose.
The difficulty of busting dealers on the dark web
Former federal prosecutor Mark Chutkow, who led the Criminal Division of the U.S. Attorney’s Office in Detroit, says the dark web has become an increasingly popular venue for illegal drug transactions.
"It’s perceived as less risky than dealing drugs hand-to-hand or in open-air drug markets," Chutkow explained. "In the old days, law enforcement officers tracked down drug dealers through informants, phone usage, surveillance and undercover buys."
But that's a lot harder to do on the dark web, Chutkow said, because the participants’ identities and locations are obscured through use of cryptocurrency and encryption technologies that anonymize servers and IP addresses.
"It’s easy to get ripped off on these online marketplaces, but drug dealers see it as an acceptable cost of doing business, preferable to getting caught by law enforcement or killed by rival drug gangs," said Chutkow, who joined the Dykema law firm last year after serving 24 years as a federal prosecutor.
Chutkow said these cases require a new breed of tech-savvy investigators and prosecutors, noting, "You can’t just cultivate or flip the local drug courier or surveil the street corner known for drug buys.
"It requires totally different informants and surveillance techniques, and sophisticated forensic software to track down hidden marketplaces and transactions," Chutkow said.
On the flip side, Chutkow added, if investigators can identify the drug dealers and how they do business, they can conduct drug transactions through informants or undercover agents, creating an electronic paper trail that’s hard to dispute at trial.
That's what happened in the Detroit case.
"The federal government is getting better at stopping this type of crime," Chutkow said, adding sophisticated forensics software and closer ties with foreign law enforcement officials who can help track down the source of drugs and money is helping fight this problem.
"But successful drug traffickers constantly adapt their tactics to evade law enforcement. It’s the age-old game of cat and mouse,” Chutkow said. "As long as there’s money to made in selling illegal drugs, there will be people who invest the time and resources in inventing new ways to do it and ambitious law enforcement officials who will chase them down and try to hold them accountable."
Tresa Baldas: tbaldas@freepress.com
This article originally appeared on Detroit Free Press: Feds bust dark web drug ring in Detroit: They were selling fake Xanax
