Silk Road Vendor Seeks Release From Jail Fearing COVID-19 Outbreak

Published at: April 9, 2020

United States Federal District Judge Jed Rakoff is considering temporarily releasing a 61-year-old toy retailer-turned-Silk Road vendor amid concerns of a purportedly imminent COVID-19 outbreak in a federal jail.

According to Law360 on April 8, the prisoner, Hugh Haney, is serving a three-and-a-half-year money-laundering sentence for failing to explain where he obtained $19 million in Bitcoins (BTC). 

While Judge Rakoff gave additional time to brief a bail request after an April 8 hearing, he described the motion for Haney’s compassionate release as “an argument for releasing every single person” in the facility.

Judge considers Silk Road vendor's request for release

Martin Cohen, the lawyer representing Haney, asserts that his client may potentially face dying in prison if he is not released, adding that Haney wants to serve out his sentence in full after the outbreak has subsided.

Cohen asserts that only seven of the 1,700 inmates at the Metropolitan Detention Center in which his client is serving out his sentence have been tested for COVID-19 — three of whom have been confirmed to have the virus.

The motion for release was criticized by the Manhattan U.S. attorney’s office. The office emphasized that federal judges in New York have denied bail for inmates with underlying medical conditions — which Haney does not have. The prosecution also expressed that they consider Haney to be a flight risk.

The 61-year-old sold oxycodone on Silk Road and ceased operating in 2012. He was apprehended after failing to explain how he came to possess $19 million in Bitcoin and pleaded guilty. When he quit operating on Silk Road, Haney’s crypto stash was worth just $10,000.

"Crypto King" fails in bid for temporary release

Haney is among several crypto criminals seeking temporary release who are fearing a rapid spread of COVID-19 in U.S. prisons.

Also on March 8, John Caruso, co-founder of the $9 million Zima Digital Assets Ponzi scheme, had his request for reconsideration of the terms of his detention rejected by the Arizona District Court.

Caruso sought the reconsideration based on COVID-19 posing an imminent threat to his health and safety in a pre-trial detention facility.

In March, the alleged operators of a $722 million Ponzi requested release from a New Jersey correctional facility citing the looming threat of a coronavirus outbreak.

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