Queens Man Convicted of Laundering Bitcoin and Operating Unlicensed Money Transmitting Business
BROOKLYN, NEW YORK – Earlier today, a federal jury in Brooklyn convicted Mustafa Goklu, also known as “Mustangy,” of money laundering and operating an unlicensed money transmitting business as part of a scheme to launder the purported Bitcoin proceeds of drug trafficking. The verdict followed a four-day trial before United States District Judge Pamela K. Chen. When sentenced, Goklu faces up to 25 years in prison. Breon Peace, United States Attorney for the Eastern District of New York, announced the verdict.
“The defendant offered his customers the ability to launder their criminal proceeds, remain anonymous and conceal where their Bitcoin was coming from so they could continue to engage in drug trafficking and other crimes while avoiding law enforcement detection,” stated United States Attorney Peace. “With today’s verdict, Goklu’s illicit business of converting money from one form to another without a required license has been shut down and the defendant has been convicted for his crimes.”
Mr. Peace thanked the U.S. Drug Enforcement Administration, New York Division, for its outstanding investigative work on the case.
As proven at trial, in July 2018, DEA special agents identified an advertisement posted on localbitcoins.com where an individual with the username “Mustangy” offered to purchase up to $99,999 worth of bitcoins (“BTC”), a digital currency also known as cryptocurrency, and convert them into U.S. currency for a fee. Law enforcement agents later identified Goklu as the individual using the username “Mustangy.” On July 11, 2018, a DEA Special Agent acting in an undercover capacity (the “UC”) began exchanging encrypted text messages with Goklu to arrange in-person exchanges of BTC to U.S. currency.
The UC and the defendant subsequently met and engaged in seven transactions or attempted exchanges of BTC to cash over a nine-month period, culminating in Goklu’s arrest in April 2019. The UC indicated to the defendant on multiple occasions that the source of the BTC the defendant was exchanging was narcotics trafficking and that as part of the UC’s business he sold oxycodone, Adderall, and marijuana. The transactions occurred in the defendant’s parked Mercedes-Benz, at a coffee shop in Sunnyside, Queens, and locations in Manhattan. The amounts exchanged at each transaction ranged from approximately $5,000 to $50,000 for a total of $133,000. During each transaction, the UC transferred BTC to Goklu’s cryptocurrency wallet, after which the defendant retained a seven or eight percent commission fee and provided the UC with the remaining amount in cash. The evidence introduced at trial also showed that the defendant was engaged in similar illicit Bitcoin exchanges with multiple other individuals.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace will play a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including mail and wire fraud, bank fraud, health care fraud, tax fraud, securities and commodities fraud, and identity theft.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Gillian Kassner and Marietou E. Diouf are in charge of the prosecution with the assistance of paralegal specialist Bridget Donovan.
E.D.N.Y. Docket No. 19-CR-386 (PKC)