A California man accused of involvement in laundering more than $5 million has been charged with federal offenses in the Eastern District of Texas, U.S. Attorney Brit Featherston said in a news release Friday.
John Khuu, 27, of San Francisco, was charged and charged with money laundering conspiracy in May. He appeared in federal court in Tyler on Thursday and was arraigned by U.S. Magistrate Judge John D. Love.
According to Featherston, Khuu allegedly conspired with others to launder the proceeds of his drug trafficking organization through cryptocurrency. He is also accused of “distributing counterfeit pharmaceutical pills and other controlled substances on dark web markets” to clients across the country, the U.S. Attorney’s Office for the Eastern District of Texas said.
In the transactions, customers paid for the drugs with crypto, usually Bitcoin, into one of Khuu’s vendor accounts. Khuu and his co-conspirators then allegedly “exchanged the Bitcoin for US currency and laundered the proceeds through hundreds of transactions and dozens of financial accounts,” according to the statement.
Khuu and his accomplices are accused of laundering more than $5.35 million.
On August 17, a federal grand jury in the Northern District of California returned a two-count indictment charging Khuu with unlawfully importing a controlled substance. He was arrested two days later on two warrants in Garden Grove, California.
Khuu faces up to 20 years in federal prison for each charge if convicted.