U.S. Attorney’s Office Targets New Jersey Drug Ring in $54 Million Crypto Seizure

U.S. authorities have seized $54 million in cryptocurrency from a narcotics ring based in New Jersey, in a significant crackdown on illegal drug activities.

The U.S. Attorney’s Office in New Jersey filed a civil forfeiture action against Christopher Castelluzzo, Luke Atwell, and Brian Krewson, key members of this drug trafficking group.

FBI’s Strong Message

The discovery of the $54 million crypto stash appears to be linked to efforts by Christopher Castelluzzo, who is currently serving two 20-year prison sentences, to move the funds overseas to evade taxes. While incarcerated, Castelluzzo reportedly tried to communicate with his associates to facilitate this transfer.

FBI Agent James Dennehy’s statement regarding the seizure highlights the agency’s proficiency in tracing and uncovering hidden illegal assets. He emphasizes that the significant seizure should be a warning to those who erroneously think their illicit activities and profits are untraceable. 


Dennehy asserts that the FBI is capable and determined to expose criminal behavior and ensure that perpetrators face tangible, real-world consequences for their actions.

Evolution of Illicit Operations

The $54 million seizure, while substantial, only partially reflects the scale of the illegal drug trade conducted by the New Jersey narcotics ring. The forfeiture action reveals that since 2013, the defendants, Castelluzzo and his associates, have been actively engaging in the sale of drugs for cryptocurrency on various dark web markets.

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Interestingly, a portion of the cryptocurrencies, specifically 0.49 BTC, was still directly under Castelluzzo’s control. However, the majority of the funds were diversified and reinvested into other cryptocurrencies, which have significantly appreciated in value over time.

This strategy of reinvesting the proceeds into various digital currencies not only complicated the tracking process but also amplified the total value of their illegal earnings, culminating in the multi-million dollar sum seized by the authorities.

Diverse Crypto Portfolio Linked to Illicit Activities

The majority of the seized assets in this case are in Ether, with a staggering 30,000 ETH, originally purchased during Ethereum’s initial coin offering (ICO). This significant holding underscores the depth of the defendants’ involvement in cryptocurrency as a means of facilitating their illegal drug trade.

In addition to Ethereum, the narcotics ring diversified their illicit proceeds into various other cryptocurrencies. Notable investments include Chainlink, Polkadot, Algorand, along with eight other digital currencies, expanding their portfolio beyond just Bitcoin and Ether.

U.S. Attorney Phillip R. Sellinger emphasized the commitment of the U.S. justice system to relentlessly pursue and recover profits derived from criminal activities, irrespective of their form. Sellinger’s statement highlights the government’s resolve to adapt its strategies to modern financial systems, including sophisticated avenues like cryptocurrency.

He stressed that the justice system is equipped and prepared to confiscate illegal gains, whether they exist as traditional cash or in complex forms like digital currencies.

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Consistent Legal Stance on Cryptocurrency and Crime

Sellinger’s remarks echo a growing trend in legal statements concerning cryptocurrency-related crimes. This trend was also noted in the aftermath of the guilty verdict of Sam Bankman-Fried (SBF), where similar sentiments were expressed.

The key takeaway from these statements is the neutral stance towards cryptocurrency itself; it’s not portrayed as the catalyst for criminal activity. 

Both attorneys, in their respective cases, emphasized that the nature of the proceeds from illegal activities remains illicit, regardless of their form. Whether the profits are in traditional cash or digital assets like cryptocurrencies stored on USB sticks, their origin as proceeds of crime classifies them as unlawful.

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Donald Haymatter

Donald Haymatter is an expert broker with 15+ years of experience. He stays up-to-date with the latest financial news and trends to help clients make informed investment decisions. Donald is known for his analytical approach and personalized investment advice. Outside of work, he enjoys reading and mentoring young professionals.

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