Ohio Man Could Serve Prison Time for Money Laundering Over $300 Million through Bitcoin
According to the U.S. Department of Justice, a significant portion of funds involved in darknet drug markets were being laundered using a cryptocurrency service operated by Ohio-based Larry Dean Harmon.
Harmon, aged 41, was sentenced to three years in prison for running a cryptocurrency service called Helix, which was utilized by criminals to launder millions of dollars, as stated by the U.S. Department of Justice (DOJ).
The DOJ highlighted that from 2014 to 2017, Helix processed around 354,468 bitcoins, equivalent to approximately $311,145,854 in U.S. dollars at the time, on behalf of its users. A significant portion of these funds was associated with darknet drug markets, with Harmon earning commissions and fees from these transactions.
Earlier, the department mentioned that Harmon had previously promoted Helix as a method to evade detection by law enforcement agencies.
Darknet is a clandestine section of the internet that requires special authorization to access and cannot be found through standard search engines like Google.
Crypto mixing services are sought after by individuals looking to maintain the privacy of their transactions, as all blockchain transactions on Bitcoin are inherently public.
Harmon was charged in 2020 and pleaded guilty to conspiracy to commit money laundering in U.S. District Court for the District of Columbia in August 2021. He is required to forfeit cryptocurrencies, real estate, and monetary assets valued at more than $400 million.
In 2020, Don Fort, chief of IRS Criminal Investigation, denounced the audacity of Helix, labeling it as the most egregious aspect of the operations. He described Harmon as a criminal facilitator of numerous illicit activities.
Legal Action Against Mixers
Over the years, several other crypto mixers have faced legal action from U.S. authorities.
Sterlingov managed the service from October 2011 to April 2021, transferring over 1.2 million Bitcoins, valued at nearly $400 million during the relevant period, with most funds associated with illegal activities.
Furthermore, in November 2023, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned crypto mixer Sinbad.io for its role as a significant money laundering tool for the Lazarus hacking group affiliated with the North Korean government.
Chainalysis clarified that while crypto mixers are not explicitly illegal in most jurisdictions, they must comply with regulations such as registering as money transmitters under the Bank Secrecy Act in the United States. They are required to maintain anti-money laundering and KYC programs, as well as fulfill record-keeping and reporting obligations.
It was also noted that all mixers operating in the U.S. must take steps to avoid engaging with sanctioned entities.
