Chester Anderson Manufactured and Shipped Controlled Substances, Laundered Proceeds Using Bitcoin
Manhattan District Attorney Alvin L. Bragg, Jr., today announced the sentencing of CHESTER ANDERSON, 48, to nine years in state prison for serving as the ringleader of a major dark web drug trafficking scheme. ANDERSON and his co-conspirators operated storefronts on the dark web that sold and shipped hundreds of thousands of Xanax tablets and other controlled substances to buyers across the country and laundering more than $2 million in cryptocurrency.
In March of this year, ANDERSON pleaded guilty in New York State Supreme Court to Conspiracy in the Fifth Degree, Operating as a Major Trafficker, Conspiracy in the Fourth Degree and Money Laundering in the First Degree.
“Chester Anderson profited by operating in the shadows of the dark web to sell illicit drugs,” said Manhattan D.A. Alvin Bragg. “Our office will continue to utilize our unparalleled cybercrime expertise and investigative skills to hold accountable those who think they can use cryptocurrency to facilitate dangerous illegal activity.”
As admitted in the defendant’s guilty plea, ANDERSON and his co-conspirators operated two dark web storefronts and laundered approximately $2.3 million in proceeds by using the cryptocurrency they received as payment to load pre-paid debit cards. They collectively withdrew more than $1 million from ATMs in Manhattan and New Jersey.
Following a series of undercover purchases made in cryptocurrency of 10,000 Xanax tablets, in addition to ketamine and GHB, court-authorized search warrants were executed on New Jersey properties and vehicles associated with ANDERSON and his co-conspirators. During the course of the investigation, Manhattan D.A. investigators seized and recovered:
- The largest quantity of pills in New Jersey State history, including approximately 600,000 Xanax tablets
- Approximately 500 glassines of fentanyl-laced heroin
- Large quantities of methamphetamine, ketamine, gamma hydroxybutyric acid (GHB), and more.
- Four pill presses and two industrial mixers, among other drug manufacturing items
- Thousands of dollars’ worth of cryptocurrency
- Three illegally possessed firearms
- 8,000 tablets by intercepting packages shipped by the defendants that falsely identified the sender as a Manhattan business.
Through a shell company, Next Level Research and Development, ANDERSON and a co-conspirator purchased more than 1,000 kilograms of microcrystalline cellulose, the primary ingredient used to manufacture pharmaceutical tablets. He also used a co-conspirator’s Asbury Park, N.J., cellphone repair store, The Wireless Spot, to purchase a pill press, a powder mixer and “punch dies” used to imprint “Xanax” labels.
Assistant D.A.s Jeremy Glickman (Chief of the Cybercrime and Identity Theft Bureau) and Robert Shull (Deputy Chief of the Cybercrime and Identity Theft Bureau) handled the prosecution of the case under the supervision of Executive Assistant D.A. Susan Hoffinger (Chief of the Investigation Division). Supervising Rackets Investigator Gregory Dunlavey, High Technology Analysis Unit Director Steve Moran, Supervising Computer Forensic Analyst Douglas Daus, and High Technology Analysis Unit Deputy Director David Chan assisted with the investigation.
D.A. Bragg thanked the U.S. Secret Service, U.S. Postal Service, South Brunswick Township Police, and the Middlesex County Prosecutor’s Office for their invaluable assistance.
Middlesex County, NJ
- Operating as a Major Trafficker, one count
- Money Laundering in the First Degree, a class B felony, one count
- Conspiracy in the Fourth Degree, a class E felony, one count
- Conspiracy in the Fifth Degree, a class A misdemeanor, one count
- Operating as a Major Trafficker, one count, 9 years prison, 5 years of post-release supervision
- Money Laundering in the First Degree, a class B felony, one count, 3-9 years state prison, concurrent
- Conspiracy in the Fourth Degree, a class E felony, one count, 1 1/3 to 4 years state prison, concurrent
- Conspiracy in the Fifth Degree, a class A misdemeanor, one count, 1 year jail, concurrent