Springfield man busted laundering profits from pot to cryptocurrency

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A 39-year-old man from the RM of Springfield faces numerous charges after RCMP investigators uncovered a scheme to launder the proceeds of his illicit drug trafficking operation into cryptocurrency. The investigation also resulted in the seizure of more than $6 million in drugs, equipment and proceeds of crime.

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"The suspect in this investigation was obtaining medical cannabis cultivation licenses from Health Canada through fraudulent means and growing large quantities of illicit cannabis to sell through a criminal network, and was then converting that ill-gotten money into cryptocurrency to finance their lavish lifestyle and other criminal enterprise," said RCMP intelligence officer Insp. Joe Telus at a news conference at RCMP headquarters on Tuesday. "We see, through Project Divergent and Project Decrypt ", how these networks feed off each other and are interconnected. We are not targeting legal cannabis consumers. These large-scale operations are producing illicit products and fueling criminal networks, and the RCMP will continue to work tirelessly to disrupt those networks."

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RCMP Insp.  Joe Telus
RCMP intelligence officer, Insp. Joe Telus, at a news conference in Winnipeg on Tuesday, December 5, 2023, where details of a money laundering and drug trafficking investigation were revealed. Photo by Chris Procaylo /winnipeg sun

Following an extensive RCMP investigation into federal, serious and organized crime, police linked the Springfield man to several different drug trafficking operations. The RCMP's Project Divergent, which concluded in March 2022, saw 22 people arrested for drug trafficking offences, and that investigation opened avenues into other drug networks, spurring Project Decrypt, in which seven people were arrested.

In April 2021, Project Decrypt began analyzing the trafficking of large quantities of illicit cannabis. As the investigation continued, RCMP said investigators discovered the suspect had fraudulently acquired a Health Canada license for a micro-growing operation. Additionally, he was using legitimate personal Health Canada medical licenses in the names of associates to feed his criminal networks with the cannabis he was growing.

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When investigators analyzed the profits from the operation, they discovered that he was laundering his profits by converting cash into cryptocurrency. He did this by purchasing digital money and then transferring that money to a cryptocurrency account. He also helped others launder the proceeds of crime into cash and convert them into cryptocurrency.

RCMP cannabis, cryptocurrency
Manitoba RCMP released a photo of a micro-growing operation in Manitoba involved in an illicit drug operation and cryptocurrency money laundering scheme. Photo by Handout/Manitoba RCMP /winnipeg sun

On June 8, 10 properties were registered in RM of Springfield, Sunnyside, Navin and seven in Winnipeg. Another property was searched in Winnipeg in August. The searches resulted in the seizure of more than $6 million in drugs, equipment and proceeds of crime. More than $3 million in property, more than $2 million in illicit cannabis, almost $700,000 in drug and cryptocurrency equipment, more than $203,000 in lifestyle items, more than $15,000 in cash and seven firearms were seized during the searches.

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The defendant was arrested at his residence in RM of Springfield when the search was executed and faces five counts of the Cannabis Act and five counts of the Penal Code, including fraud over $5,000, identity fraud, possession of property obtained by crime , money laundering and falsehood. claims. A 33-year-old man was arrested during a search of his residence in Winnipeg and five associates were arrested during the month of June in Winnipeg, and one in September.

The 33-year-old ran the medicinal cultivation operation and faces charges under the Cannabis Act.

RCMP cannabis, cryptocurrency
Manitoba RCMP released a photo of a vehicle seized in an illicit drug operation and cryptocurrency money laundering scheme. Photo by Handout/Manitoba RCMP /winnipeg sun

Also charged were a 33-year-old man from Ste. Anne, who acted as a courier, and four men from Winnipeg, including a 71-year-old relative of the Springfield man.

The owner of the property where the illicit medical cultivation was taking place was also charged, but his charges were stayed as he has since passed away.

All have been released pending court dates.

gdawkins@postmedia.com

X: @SunGlenDawkins

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