A Colombian cryptocurrency broker has been sentenced to 160 months in federal prison for his role in an international drug-money laundering operation that used Tether (USDT), a stablecoin designed to hold a one-to-one peg with the U.S. dollar. U.S. prosecutors announced the sentence on October 21, 2026, following an investigation into cryptocurrency transactions and narcotics trafficking.

Leonardo de Jesus Zuluaga Duque, known by the alias "Rey," helped move approximately $14.5 million in drug proceeds through cryptocurrency accounts and shell companies. U.S. District Judge Mary Kay Vyskocil imposed the sentence, which amounts to 13 years and four months in federal prison.

How the $14.5 Million USDT Laundering Scheme Operated

According to the U.S. Department of Justice, Zuluaga Duque supervised part of an international network that converted illegal proceeds into USDT. The operation relied on cryptocurrency transfers, unlicensed financial services, and businesses operating across Colombia and the United States.

Between May and November 2023, the network processed approximately $14.5 million in Tether tied to drug trafficking. Unlike physical cash, those transfers were recorded on public blockchains, where every movement of funds leaves a permanent, traceable record.

Zuluaga Duque worked alongside Erica Milena Lopez Ortiz to transfer USDT to Maximilien de Hoop Cartier, who ran an unlicensed money transmission business. U.S. law requires money transmitting businesses to register with federal regulators, and operating without a license is itself a criminal offense. Cartier converted the cryptocurrency into U.S. dollars and moved the funds through American shell companies — entities that exist largely on paper, with no significant operations of their own. The money subsequently reached Colombian businesses, where participants converted it into pesos for distribution. Prosecutors said the arrangement enabled the network to move criminal proceeds through multiple financial channels.

Cocaine Trafficking Conspiracy Adds to the Case

The investigation also revealed Zuluaga Duque's involvement in a cocaine trafficking conspiracy targeting the United States. In November 2023, undercover investigators coordinated a transaction involving approximately nine kilograms of cocaine paste intended for eventual delivery to New York. Prosecutors said Zuluaga Duque collected a commission for helping arrange the deal.

Authorities later recovered approximately 111 kilograms of cocaine paste during searches conducted in Colombia in February 2024.

Court Orders Millions in Forfeiture

In addition to the prison term, Zuluaga Duque must serve five years of supervised release — a period of court-ordered monitoring that follows custody in the U.S. federal system — and forfeit $14,751,846. The court also ordered the forfeiture of cryptocurrency tokens previously held in four addresses under his control, bringing on-chain assets within the government's asset-seizure process.

All five co-defendants have received prison sentences.ier was previously sentenced to eight years for financial crimes involving more than $470 million in illicit transfers.

The case illustrates how criminal networks can exploit stablecoins and traditional banking infrastructure to transfer illegal funds internationally. It also underscores the importance of anti-money laundering controls as cryptocurrencies become increasingly integrated into the global financial system.