A California man has been sentenced to federal prison for his involvement in a cryptocurrency money laundering conspiracy. The announcement was made by Acting U.S. Attorney Abe McGlothin, Jr.
John Khuu, 29, from San Francisco, pleaded guilty to charges of conspiracy to commit money laundering and operating an unlicensed money transmitting business. He received an 87-month sentence from U.S. District Judge J. Campbell Barker on March 12, 2025.
Court documents revealed that Khuu collaborated with others to launder proceeds from his drug trafficking activities through cryptocurrency. He imported counterfeit pharmaceutical and MDMA pills from Germany and distributed them across the United States via dark web markets (DWMs). Customers paid using cryptocurrency, primarily Bitcoin (BTC), which was transferred to Khuu's vendor accounts. The BTC was then exchanged for U.S. currency and laundered through numerous transactions and financial accounts.
Khuu faced indictment on May 18, 2022, in the Eastern District of Texas for conspiracy to commit money laundering. On August 17, 2022, he was indicted in the Northern District of California for unlawful importation of a Schedule I controlled substance. Agents arrested him on August 19, 2022, at a residence in Garden Grove, California.
This case is part of Operation Crypto Runner under the Organized Crime Drug Enforcement Task Forces (OCDETF) program. OCDETF aims to identify and dismantle high-level criminal organizations threatening the United States through a coordinated multi-agency approach.
The investigation involved the U.S. Secret Service, U.S. Postal Inspection Service, and Homeland Security Investigations in San Francisco. Prosecution was handled by Assistant U.S. Attorneys D. Ryan Locker and Nathaniel C. Kummerfeld for the Eastern District of Texas and Assistant U.S. Attorney Charles Bisesto for the Northern District of California.
