US indicts nine in crypto laundering scheme linked to drug cartels

A major money laundering network powered by cryptocurrencies linked to international drug cartels has been dismantled by United States federal authorities.

On Nov. 21, a federal grand jury in the Southern District of Florida indicted nine individuals for conspiracy to launder U.S. currency and operating an unlicensed money-transmitting business.

The charges follow a multi-agency operation involving Homeland Security Investigations, the IRS Criminal Investigation Unit, and the Broward County Sheriff’s Office, which found that the defendants used cryptocurrencies to launder drug money from the U.S. to cartels operating out of Mexico and Colombia in between 2020 and mid-2023.

Court documents reveal that the operation involved coordinating the delivery of cash and cryptocurrency to black-market exchangers, with some participants acting as couriers, physically transporting cash between various U.S. cities.

All nine face charges of conspiracy to commit money laundering and operating an unlicensed money-transmitting business. So far, three other individuals connected to the case have already been convicted.

Cryptocurrencies, with their borderless appeal and transactional opacity using tools like crypto mixers, have provided cartels with a modern loophole—transforming traditional money laundering into a digital operation that’s harder to trace but just as lucrative.

These schemes are often run using cryptocurrency exchanges and shell companies, which serve as fronts to obscure the origins of illicit funds.

Back in March, a Las Vegas CEO was convicted for using Bitcoin to launder over $4 million worth of funds to cartels in Mexico in 2021. Meanwhile, in 2018, two companies accused of laundering funds for Colombian cartels were allegedly using crypto exchange Bitfinex.

Maximilien Cartier, a successor to the French luxury brand, was also indicted in May for laundering millions worth of Comolbian cartel money via over-the-counter USDT trades.   

With the growing use of cryptocurrencies in such avenues, regulators all across the globe have ramped up scrutiny and enforced stricter measures to curb illicit activities.