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Feds have hit an Olympic snowboarder with criminal charges for his alleged role in a cocaine trafficking gang, which used the stablecoin Tether (USDT) as a key part of its billion-dollar operation.
A U.S. Department of Justice (DOJ) indictment filed Thursday alleged that former pro snowboarder Ryan James Wedding and 15 other defendants ran a drug-trafficking syndicate, shipping cocaine from Colombia through Mexico and into the United States and Canada.
The crime gang committed multiple murders as part of their operation, U.S. authorities alleged—and used crypto to try and evade the cops.
“Defendant Bonilla would tender payment to defendants Wedding and Clark via a Tether cryptocurrency payment service for two kilograms of cocaine,” the indictment reads. It added that QR codes were sent to drug runners in order to receive payment in USDT.
The DOJ said that it had seized over $3.2 million in cryptocurrency, along with more than one ton of cocaine, three firearms, dozens of rounds of ammunition, and $255,400 as part of the investigation.
Wedding is now on the run, authorities said. The FBI is now offering a $50,000 reward for information leading to the arrest and extradition of Wedding, the 47-year-old who competed for Canada at the 2002 Winter Olympic Games and had recently been living in Mexico.
His Olympic biography says that the sportsman “was convicted of attempting to buy cocaine from a US government agent” back in 2008, and given four years’ of jail time as a result.
“As alleged in the indictment, an Olympic athlete-turned-drug lord is now charged with leading a transnational organized crime group that engaged in cocaine trafficking and murder, including of innocent civilians,” United States Attorney Martin Estrada said in a statement.
USDT is the third-biggest cryptocurrency by market cap and one of the most-traded digital assets, with the second highest 24-hour trading volume after Bitcoin.
The token is important for the crypto ecosystem because it’s used by traders to enter and exit trades quickly, and to convert crypto to fiat via a traditional bank.
But the cryptocurrency and the company that issues it are controversial: Tether has been slow to provide documentation to prove that U.S. dollars back USDT; U.S. regulators have taken issue with the fact that the entity is also not independently audited.
In 2021, Tether agreed to no longer do business in New York after a two-year state attorney general investigation found it had “made false statements about the backing” of its stablecoin.
However, the company routinely points to quarterly attestations and transparency reports as proof of its compliance, and has been working closely with law enforcement to freeze funds suspected to be used by criminals.
Edited by Andrew Hayward