According to local reports, the Brazilian State Department of Drug Trafficking (Denarc) on April 23 was chasing a drug trafficking suspect when it stumbled on a secret bitcoin mining laboratory located in the region of Avenida Oscar Pereira, Porto Alegre.
The mining laboratory operated in a small room with little ventilation reportedly have up to 25 cryptocurrency mining machines which authorities believed was in operation twenty-four hours a day. They also found sophisticated hardware and software estimated at 250,000 reals ($63,000).
Upon arriving the scene, a certain man (identity withheld) showed up and claimed ownership of the secluded mining firm, even telling authorities that he “rented the space and was mining bitcoins with investment - which is not abnormal.”
He was then fined for subtle theft since the mining farm was consuming more electricity than allocated to it, and wasn’t making use of any renewable energy sources.
Meanwhile, authorities would continue the investigation into the mining operation since it is situated in an area that drug traffickers often flock. The report notes that such a location means that there is a chance that he works with drug traffickers to launder their money using Bitcoins.
"It's a well-hidden, clandestine place. Let us deepen the investigations. Everything indicates that it may be a bitcoin mining activity [but] they can make the exchange and payment for drug dealers” a police spokesperson said.
In another story regarding money laundering using Bitcoin, we reported earlier today the New York authorities convicted two men, Callaway Crain, and Mark Sanchez.
Both men pleaded guilty to selling controlled substances and laundering the proceeds estimated at $2.8 million through Bitcoin and Western Union payments. As punishment, Crain and Sanchez are set to get a prison term anywhere between 2.5-7.5 years.