Man Gets Six Years in Prison for Laundering $1M in Bitcoin for Scammers and Drug Dealers

Disturbing development in the crypto world

A man who turned cash into Bitcoin for con artists and drug dealers has been sentenced to six years in prison. Trung Nguyen, of Danvers, Massachusetts, ran an unauthorized, “no questions asked” money transmission business called National Vending, the U.S. Department of Justice said.

Millions of dollars converted into crypto

Over a three-year period, Nguyen converted more than $1 million into cryptocurrency, receiving compensation for his services. The 48-year-old was convicted of accepting $250.000 in cash from someone who identified himself as a meth dealer—and $445.000 from romance scam victims, who were defrauded into BTC to send to scammers abroad.

Embezzlement and creative banking

Nguyen took several measures to cover his tracks. He told banks and crypto exchanges that his company was actually an ATM business. Encrypted messaging apps were used to communicate with customers, while BTC transactions were obfuscated, making it harder to trace the money flows. For larger cash deposits of over $10.000, the amounts were split up into smaller amounts and distributed over multiple days or to different banks.

“I'm not a criminal, I'm just creative with finances,” he might say, but the reality is much less glorious.

Nguyen even took a course to learn how to disguise his shady operation. During this course, he was given the 'tips' to develop a cover story, generate a fictitious list of suppliers, and never use the word “Bitcoin.”

Court verdict and prosecutor's message

Judge Richard G. Sterns ordered Nguyen to forfeit $1,5 million and added that he would serve three years of supervised release following his prison sentence. At his sentencing, following a five-day trial in November, acting U.S. Attorney Joshua Levy had a clear message for money launderers: Bitcoin offers no anonymity for cleaning dirty money.

“This suspect’s no-questions-asked operation allowed a known drug dealer to turn his dark cash into more deadly meth pumped onto our streets, and it allowed scammers to fleece vulnerable victims of their hard-earned savings,” Levy said.

National Vending operated between September 2017 and October 2020 but was not registered with the Financial Crimes Enforcement Network and missed essential anti-money laundering controls.

Frequently Asked Questions

Why was Trung Nguyen convicted?
Here are some examples of his illegal activities, including converting millions of dollars into Bitcoin for drug dealers and scammers.

How much money exactly did he convert?
Nguyen has converted more than $1 million into cryptocurrency in a three-year period.

What are the implications for Nguyen?
He was sentenced to six years in prison and ordered to forfeit $1,5 million, followed by three years of supervision.

Developments in the crypto world continue to surprise us, and every now and then the question arises: what other stories are waiting to be revealed?