Federal prosecutors in Texas have slapped 21 U.S. citizens with an assortment of criminal charges for allegedly helping various transnational criminal rings launder their ill-gotten gains using cryptocurrency.
Dubbed Operation Crypto Runner, the multi-year investigation was conducted by the East Texas branches of the Department of Justice (DOJ), the U.S. Secret Service (USSS), and the Postal Inspection Service (PIS) – the law enforcement arm of the U.S. Postal Service.
The operation has “disrupted more than $300 million in annual money laundering transactions, seized and forfeited millions in cash and cryptocurrency, and identified thousands of victims,” according to a press release issued Wednesday.
Prosecutors say the 21 individuals caught in Operation Crypto Runner’s snare each played a key role in international scam and criminal operations, acting as domestic money launderers for their foreign co-conspirators.
At least four of the 21 people charged have already pleaded guilty to their crimes.
Maryland woman Zenobia Walker, 65, pleaded guilty in January to her role in a a scheme in which she received over $300,000 from victims of romance scams and other fraud schemes, deposited the money in her personal bank accounts, exchanged it for cryptocurrency and passed the crypto on to her foreign co-conspirators. She was sentenced to 18 months in prison on Nov. 2.
Three more individuals – Tulasidas Konda, 57, and Lois Boyd, 76, both of Virginia, and Deependra Bhusal, 46, of Texas – pleaded guilty to charges in connection with a multi-year money laundering conspiracy for proceeds of various scams.
The alleged ringleader, Konda opened bank accounts and mailboxes that were used to receive money from scam victims, exchange the money for crypto and then send the crypto to wallets controlled by the trio’s foreign co-conspirators. The three laundered roughly $6 million combined, according to the government release.
Two other defendants – Randall Rule, 71, of Nevada and Gregory Nysewander, 64, of South Carolina – have been similarly accused of converting $2.4 million in funds from romance scams, business email compromises and real estate scams into crypto for foreign operators. Rule and Nysewander have not pleaded guilty.
Another group of 10 defendants have been charged with taking part in a wire and mail fraud conspiracy that used fake technical support schemes to persuade victims to send money, often using shell companies and business bank accounts created to look like legitimate companies.
Two more defendants – John Khuu, 27, of California and Sharena Seay, 37, of Florida – have been indicted on money laundering charges for two separate alleged schemes to launder money tied to drug trafficking operations via crypto.
There are more arrests to come, according to the USSS.
“Today’s announcement demonstrates the investigative capabilities of the Secret Service and highlights the success of our collaborative efforts through Operation Crypto Runner to dismantle and disrupt transnational money laundering networks,” said William Smarr, special agent in charge of the U.S. Secret Service’s Dallas field office in the release.
“These arrests are just the beginning,” Smart added. “We are committed to bringing each of the remaining perpetrators to justice.”