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Drug Dealers Busted For Operation Using Bitcoin, Darknet

DENVER (CBS4) -- Two men - Timothy Howell, 46, and Cavin Mower, 44 - have been sentenced in federal court for distributing cocaine and laundering money using the darknet and bitcoin.

The United States Attorney (District of Colorado) described a plea agreement reached with both men ending multi-year prison sentences and additional years of supervision following their release from prison.

The pair was accused of obtaining cocaine through a darknet supplier and then re-selling the drugs to their own customers within Colorado and across the country via their own darknet vendor account.

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The darknet is an 'anonymous' section of the internet, purposefully hidden from public view and inaccessible by normal search engines and browsers.

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Prosecutors accused Howell and Mower of shipping nearly 50 kilograms of cocaine through the U.S. Postal Service. They were paid in bitcoin, an alternative money system and established form of cryptocurrency.

Howell and Mower laundered the bitcoin proceeds by using a website that allowed them to purchase gift cards. Those gift cards could be used to buy goods and services. Howell and Mower also exchanged bitcoin for cash using the services of an international money transfer company.

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Howell received a sentenced of 66 months imprisonment and Mower 50 months. Mower's case also contained one count of Aggravated Identity Theft. Prosecutors said he used another person's information to gain access to a TSA-controlled area of an international airport and board a flight to Denver.

"Today's sentencing," said Steven Cagen, Special Agent in Charge, Homeland Security Investigations/Denver, "sends a warning to criminals that no matter how sophisticated they believe they are, we will find them and bring them to justice, and they can't hide from us online."

The case was jointly investigated by agents from the U.S. Postal Inspection Service, U.S. Immigrations and Customs Enforcement, Homeland Security Investigations, Internal Revenue Service Criminal Investigations, and the Denver Digital Currency and Darknet Working Group.


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