California man pleads guilty in Bitcoin money laundering conspiracy in East Texas

TYLER, Texas (KETK) – A California man has pleaded guilty to federal charges in a money laundering conspiracy across the U.S., including East Texas.

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U.S. Attorney Damien Diggs announced on Tuesday that John Khuu, 28, pleaded guilty in a Tyler federal court to conspiracy to commit money laundering, conspiracy to operate an unlicensed money transmitting business and importation of MDMA.

According to a release, information presented in court showed Khuu had conspired with others to launder the proceeds of his drug trafficking organization through cryptocurrency.

“Khuu imported and distributed counterfeit pharmaceutical pills and other controlled substances on dark web markets (DWMs) and elsewhere to customers across the United States,” the release said. “Customers paid for their purchases by transferring cryptocurrency, usually Bitcoin (BTC), from their DWM customer accounts to one of Khuu’s vendor accounts. Khuu and his co-conspirators traded the BTC for U.S. currency and laundered and transmitted the proceeds through hundreds of transactions and dozens of financial accounts.”

Khuu was indicted in 2022 in both East Texas and California in this case and now faces up to 20 years in federal prison.

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