Larry Dean Harmon, who operated the cryptocurrency mixer Helix and the darknet search engine Grams, was sentenced Friday in a federal court in Washington, D.C.
He is set to serve a three-year prison sentence for laundering over 350,000 Bitcoin valued at more than $300 million at that time.
Prosecutors revealed that Harmon facilitated illegal transactions through major darknet markets. In addition to his prison term, he was ordered to forfeit more than $400 million in cryptocurrency, real estate, and other assets.
Facing Justice for Conspiracy
Harmon originally faced a potential 20-year sentence for conspiracy to launder money. Prosecutors recommended a 75-month prison term, but the court took into account his remorse and cooperation with investigators. He was consequently given a lighter sentence. Harmon will also be on supervised release for three years following his jail sentence.
Helix, the cryptocurrency mixer Harmon operated from 2014 to 2017, obscured Bitcoin transactions by merging cryptocurrency from multiple sources and redistributing it. This service made it almost impossible to trace the transactions.
Prosecutors called the scale of the crimes “staggering.” To complement Helix, Harmon developed Grams, a search engine designed to connect users with darknet markets.
He also created an Application Programming Interface (API) to integrate Helix into darknet market withdrawal systems. According to the Department of Justice, these tools allowed criminals to launder proceeds from illegal activities, such as drug trafficking, with relative ease.
Cooperation Earns Leniency
Harmon pleaded guilty in 2021 and expressed remorse during his sentencing. His attorney, Charles Flood, emphasized that Harmon had voluntarily shut down Helix and Grams two years before his 2020 arrest. Flood stated, “Mr. Harmon has voluntarily ceased operations and has shown genuine remorse for his actions.”
Harmon also assisted prosecutors in securing other convictions, including that of Bitcoin Fog operator Roman Sterlingov, who was sentenced to 12.5 years in prison on November 8. The court acknowledged Harmon’s cooperation and his efforts to reform, which contributed to his lighter sentence.
Family Betrayal and Asset Forfeiture
In addition to his prison sentence, Harmon was fined $60 million by the Treasury Department’s Financial Crimes Enforcement Network in 2020. Among the forfeited items were 713 digital tokens held in an IRS-secured evidence locker.
Shockingly, after Harmon’s arrest, his brother, Gary Harmon, used Larry’s credentials to recreate Bitcoin wallets stored in the IRS system. Gary then moved the stolen cryptocurrency and spent it on personal luxuries, including a Cleveland condo.
Evidence found on Gary’s phone even included a photo of him in a nightclub bathtub filled with cash. Due to his involvement in the theft and asset laundering, Gary Harmon entered a guilty plea and received a four-year prison sentence.
A Warning for Crypto Criminals
The sentencing of Larry Dean Harmon highlights the U.S. government’s growing focus on combating cryptocurrency-based money laundering. Alden Pelker, the prosecutor in the case, described Harmon’s activities as blending advanced technology with traditional crime, saying, “He brought search engine optimization to local cocaine distributors.”
This case underscores the risks associated with cryptocurrency mixers, which remain a key tool for cyber criminals and money launderers. By dismantling these operations, authorities aim to foster a more transparent and secure cryptocurrency ecosystem.