A suspected darknet drug dealer ended up indicted for leveraging Bitcoin’s apparent anonymity to sell fentanyl online, federal officials said.
Sean Shaughnessy, 51, of the Dallas Fort Worth, Texas, area ended up charged Wednesday with conspiracy to possess with intent to distribute controlled substances, distribution of a controlled substance, distribution of a controlled substance analogue and eight counts of money laundering.
The charges against Shaughnessy are the result of the first nationwide undercover operation targeting darknet vendors.
Shaughnessy is charged with selling fentanyl and fentanyl analogues over the dark web, an unindexed portion of the internet accessible only via specialized software that allows users to conduct transactions with relative anonymity, according to the indictment. His buyers purchased the fentanyl and fentanyl analogues, which was shipped to their addresses, using cryptocurrencies like Bitcoin, the indictment said.
One user, according to the indictment, who purchased a fentanyl analogue from Shaughnessy, overdosed on the substance and died.
Shaughnessy transferred his Bitcoin proceeds to other cryptocurrency wallets in exchange for regular fiat currency, which was shipped to his home in Dallas, officials said. Unbeknownst to Shaughnessy, he sent more than $120,000 bitcoin to wallet addresses controlled by federal agents.
After his arrest, he was ordered to remain in federal custody.
The investigation was part of Operation Dark Gold, a year-long, coordinated national operation that used the first nationwide undercover action to target vendors of illicit goods on the darknet. Special agents of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) New York Field Office posed as a money launderer on darknet market sites, exchanging U.S. currency for virtual currency. Through this operation, HSI New York was able to identify numerous vendors of illicit goods, leading to the opening of more than 90 active cases around the country, including the investigation into Mr. Shaughnessy in the Northern District of Texas.