Crypto Broker Sentenced to 160 Months in US Drug-Money Laundering Case

Crypto Broker Sentenced to 160 Months in US Drug-Money Laundering Case

by | Oct 23, 2026 | News

A crypto broker sentenced to 160 months in federal prison on October 21, 2026, was tied by prosecutors to the laundering of roughly $14.5 million in narcotics proceeds via Tether's USDT and a plot to import cocaine. Leonardo de Jesus Zuluaga Duque, 63, a Colombian known as "Rey," received the sentence in the Southern District of New York, where prosecutors said he held a supervisory role in a cross-border laundering network.

The case shows how stablecoin transfers can serve as one link in a laundering chain that still depends on shell companies, dollar conversions and conventional bank accounts. Prosecutors said the network moved value from Colombia into the US financial system and back, ending with pesos distributed to the original participants.

Sentence and forfeiture terms

US District Judge Mary Kay Vyskocil imposed the 160-month term on October 21, 2026, according to Crowdfund Insider and TOKENPOST. The sentence works out to 13 years and four months in prison.

Beyond prison time, the court ordered five years of supervised release for Zuluaga Duque and a forfeiture of $14,751,846, along with cryptocurrency previously held in four addresses under his control. The forfeiture order is separate from the roughly $14.5 million in Tether transactions attributed to the group, and combining the two figures would overstate the proceeds described in the case.

How the laundering network moved funds

Between May and November 2023, Zuluaga Duque worked with several associates to move about $14.5 million in drug proceeds through the network. Drug money was converted into USDT in Colombia, transferred to an American intermediary and exchanged for US dollars, according to prosecutors.

Those dollars then moved through US-based shell companies before returning to Colombian businesses, where the funds were converted into pesos and distributed. The token transfer was only one part of the route, which also relied on companies, currency conversion and banking access.

The structure made any single record incomplete on its own. Monitoring a blockchain address would not necessarily explain the commercial purpose of a related bank transfer, while a bank record might identify the receiving company without revealing the earlier token movement, so reconstructing the full route required connecting both sides.

The US intermediary and co-defendants

At the heart of the US side of the scheme stood Maximilien de Hoop Cartier, an Argentine national who claimed ties to the Cartier jewelry dynasty. Prosecutors said Cartier ran a money-transmitting operation in cryptocurrency without a license, using firms he portrayed to banks as genuine technology businesses.

Cartier's operation transmitted more than $470 million in illicit proceeds, a sum far larger than the roughly $14.5 million tied directly to Zuluaga Duque. Cartier previously pleaded guilty in a related matter and received an eight-year sentence.

Crowdfund Insider reported that Erica Milena Lopez Ortiz assisted with moving the USDT, while the returning dollar payments went to Colombian firms belonging to Felipe Estrada Echeverry. Sentences have now been handed down for each of the five co-defendants, with prison terms spanning three to eight years.

Cocaine conspiracy and arrest

Investigators also connected Zuluaga Duque to a plan to import cocaine into the US. Confidential sources directed by law enforcement set up a deal in November 2023 for approximately nine kilograms of cocaine paste, which prosecutors said was intended to be processed into cocaine before delivery to New York state.

According to the case account, the narcotics were handed to an undercover officer by Adrian Fernando Areiza Ceballos, and Zuluaga Duque took a commission for his part in arranging the transaction. The operation continued into February 2024, when investigators arranged a prospective purchase of roughly 100 kilograms of cocaine paste, and Colombian police later executed search warrants that recovered about 111 kilograms.

On April 30, 2024, police in Colombia took Zuluaga Duque and fellow defendants into custody in Medellín, with Interpol assisting. Colombia's Supreme Court backed sending him to the US to face charges, and Colombian authorities approved his extradition in early 2025 following a US request, according to earlier reports.

Investigation and what the crypto broker sentenced signals

According to US Attorney Jamie McDonald, the defendants combined cryptocurrency with shell companies and ordinary banking services to shift criminal proceeds across international borders. The case was investigated by IRS-Criminal Investigation, the FBI's New York Field Office and Homeland Security Investigations' New York El Dorado Task Force, with assistance from Colombian National Police and other international partners, according to Crowdfund Insider.

In the government's telling, the wider enterprise ran hundreds of millions of dollars in drug proceeds and other criminal funds through the US financial system by exploiting cryptocurrency, shell companies on both sides of the border and multiple crypto accounts. The Department of Justice singled out USDT by name as the main mechanism for moving the illicit funds, rather than describing crypto in general terms, Crypto Briefing reported.

The case illustrates how cryptocurrency transfers can form one part of a broader laundering process: USDT moved value across borders, but dollar conversions, shell companies and conventional bank accounts were indispensable to turning that value back into spendable Colombian pesos. Whether any exchange or wallet provider could face enforcement over the network remains an open question, because the reported announcement does not address it.

Conclusion

Zuluaga Duque's 160-month sentence closes the case against all six defendants, with the five co-defendants receiving terms of three to eight years. He must also serve five years of supervised release and surrender $14,751,846 plus cryptocurrency held in four addresses he controlled. The next concrete step is his transfer into federal custody to begin serving the term, followed by the supervised release period that begins after his release from prison.

Frequently Asked Questions

Who is Leonardo de Jesus Zuluaga Duque, the broker known as 'Rey'?

Zuluaga Duque is a 63-year-old Colombian cryptocurrency broker who used the alias "Rey." Prosecutors said he held a supervisory role in an international network that laundered drug proceeds through Tether's USDT, shell companies and US banking channels between Colombia and the United States.

How long is Zuluaga Duque's 160-month prison sentence?

The 160-month term equals 13 years and four months in federal prison. US District Judge Mary Kay Vyskocil imposed the sentence on October 21, 2026, in the Southern District of New York, and Zuluaga Duque must also serve five years of supervised release after his prison term.

How much money did the network launder through Tether's USDT?

Prosecutors attributed approximately $14.5 million in Tether transactions to Zuluaga Duque and his associates between May and November 2023. The broader unlicensed money-transmitting business run by intermediary Maximilien de Hoop Cartier transmitted more than $470 million in illicit proceeds.

What was Maximilien de Hoop Cartier's role in the laundering scheme?

Cartier, an Argentine citizen who claimed ties to the Cartier jewelry dynasty, operated an unlicensed cryptocurrency money-transmitting business that converted USDT into US dollars and routed them through US entities he controlled. He previously pleaded guilty in a related matter covering more than $470 million and received an eight-year sentence.

What cocaine charges were tied to Zuluaga Duque's case?

According to prosecutors, Zuluaga Duque took a commission for his role in setting up a November 2023 deal for roughly nine kilograms of cocaine paste intended for processing and delivery to New York. A later negotiation for roughly 100 kilograms led Colombian police to execute search warrants that recovered about 111 kilograms.

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