U.S. busts Tor drug market, arrests eight

http://www.reuters.com/article/2012/04/17/us-usa-drugs-internet-idUSBRE83G01Q20120417

by cypherpunks01 • 14 years ago

66 85 14 years ago

rdl2• 14 years ago

I'm curious how they attacked this network -- I'd assume the payment side is still the easiest, and they could look for some patterns and then set up physical surveillance at WU or other locations to catch cash transactions.

TillE• 14 years ago

> accepting payment through PayPal

Uh. How did they expect to remain anonymous with a PayPal account?

plessthanpt05• 14 years ago

hahaha...seriously? with PayPal? i suppose it could (maybe) be done with prepaid credit cards, but still.

BigTigger2• 14 years ago

When I first heard about this, I heard they anonymized their payments through bitcoins.

PayPal seems a bit of a move to widen their market

cypherpunks012• 14 years ago

Wired Article: http://www.wired.com/threatlevel/2012/04/online-drug-market-...

Cali DA press release: http://www.justice.gov/usao/cac/Pressroom/2012/045.html

Full indictment (66 pg. pdf): http://www.wired.com/images_blogs/threatlevel/2012/04/WILLEM...

drivebyacct22• 14 years ago

No way, "high-end marijuana". Crazy. Extremely dangerous!

api6• 14 years ago

It's dangerous to compete with state-protected real drug cartels.

In all seriousness... does anyone think the present-day prohibition racket isn't just as corrupt as what was going on in the 1920s? Drug Enforcement Agency... who do you think they're enforcing for?

It's almost impossible that it wouldn't be that corrupt. There is just too much freaking money involved, the stakes too high, for massive numbers of people to not be on the take.

watty3• 14 years ago

State-protected real drug cartels and prohibition rackets... can you expand? These drugs aren't just illegal here, are similar drug cartels running countries around the world?

taligent3• 14 years ago

Seriously. Why don't you just wake up and get a grip.

The majority of the countries on this planet have similar drug policies to the US. They aren't all corrupt and in many countries the policies are quite effective. So to rant on like a crazy person about corruption and conspiracies just makes you sound unstable. There are many practical areas that the US can focus on like better border controls rather than opening up the can of worms that is legalising all drugs.

pjscott2• 14 years ago

That's a shame. These guys' lives are going to be seriously messed up by this, and from the drug list, it looks like they were selling fairly ethical stuff; according to the article, they sold "LSD, ecstasy, fentanyl, mescaline ketamine, DMT and high-end marijuana".

llambda• 14 years ago

> it looks like they were selling fairly ethical stuff; according to the article, they sold "LSD, ecstasy, fentanyl, mescaline ketamine, DMT and high-end marijuana"

"Fentanyl is approximately 100 times more potent than morphine, with 100 micrograms of fentanyl approximately equivalent to 10 mg of morphine and 75 mg of pethidine (meperidine) in analgesic activity."[1]

[1] http://en.wikipedia.org/wiki/Fentanyl

pjscott2• 14 years ago

Okay, that's an exception. Scary stuff. (My sympathy is still with the guys running this service, but my estimate of their virtue went down.)

Retric3• 14 years ago

Ecstasy is horribly nasty stuff. People rarely OD, but it can vary quickly do significant and permanent brain damage with heavy use. The real problem is when the symptoms show up they are basically permanent. Honestly, prolonged heroin use is significantly less harmful, the only good thing about ecstasy is the unpleasant side effects and fairly long high limit how much people take.

knotty66• 14 years ago

MDMA (if that is what you mean, as street 'Ecstasy' can contain any number of other ingredients) is by most metrics one of the safer recreational drugs out there.

https://en.wikipedia.org/wiki/File:Rational_scale_to_assess_...

http://www.bbc.co.uk/news/uk-11660210

jmtame4• 14 years ago

There are two major misconceptions around MDMA, both funded by flawed government studies. The first misconception is that MDMA causes "holes in your brain" but this study was debunked. The original claim was based on the notion that MDMA "destroys up to 80% of your serotonin neurotransmitters irreversibly." This was shown to not be true for two reasons: a much larger study (the largest study ever conducted on MDMA use) showed that it's only possible for MDMA to affect up to 5% of your serotonin levels, and it's reversible after a period of weeks or months of nonuse.

The second major misconception is that MDMA causes Parkinson's. The original study was retracted because the drug manufacturer mislabeled the MDMA bottle as Methamphetamine, a completely different drug. They gave the Methamphetamine to monkeys instead of MDMA.

I would recommend checking this out: http://www.youtube.com/watch?v=XjvNCijeYlI

Skip to part 3 if you're wanting to get to the scientific studies.

celticninja• 14 years ago

This right here is bullshit. long term MDMA use does not cause brain damage and is certainly not worse than long term heroin use.

ChrisNorstrom• 14 years ago

The entrepreneur in me really feels for them. They're true entreppies. Risking literally everything. Sure we risk our life savings and sacrifice having a normal life but they risk losing all that AND the chance at being thrown in jail for the rest of their lives.

Every time you hear a new drug commercial on TV, pay close attention to its side effects: permanent lung damage, eye damage, brain damage, death, heart attack, stroke, birth defects, etc... Notice how a drug that damaging is perfectly legal. Then look at how weed and lsd are criminalized. Sadly, I guess we'll have to wait till the older congress retires little by little and gets replaced with new lawmakers.

rufugee• 14 years ago

You know...I have always hoped that as the older lawmakers died off, drugs would be decriminalized. However, I've since accepted that the huge amount of propaganda being shoved down our throats on a daily basis and the willingness of much of the population to not question what they're told/shown means the system will just recreate itself when that happens. Most voters are simply network repeaters...they happily echo messages/misinformation created by various sources who have a vested interest in seeing us continue to smoke cigarettes, drink alcohol and eat unhealthy foods. And the moment any of these repeaters get out of line, the sources simply need to throw up a "it's killing our helpless children" argument to get them back on track.

It's tiring and sad to watch. All of us came into this world on equal footing, in that we opened our eyes and had to learn about what life really means. The fact that we allow a controlling entity to tell us what we can and can't do with our own bodies is ridiculous and honestly downright scary. Why should they know better than I what's right for my own body? And I say this as someone who has a family, loves his children, and doesn't do drugs, but respects and values what I consider a basic human right. What you do with your body, as long as it doesn't impact others, should be your business.

milesskorpen• 14 years ago

5,200 orders valued, in total, at $1M. Over a ~2 year period. That's it? Hardly seems like much of a story. Particularly since Tor is of limited use when your system depends on electronic payment systems.

BigTigger2• 14 years ago

I believe they were using bitcoins to anonymize some transactions.

The hardest thing for a regular consumer I would think would be finding a drop point. Drugs and things sent through the mail would be fairly easy to track to a consumer who could then be charged for possession.

rorrr3• 14 years ago

> Drugs and things sent through the mail would be fairly easy to track to a consumer

Yeah, how?

gonehome• 14 years ago

I don't think these guys used bitcoin, I think you're thinking of silkroad (another tor based drug network that wired wrote about a while back). As far as I know silkroad is still operating - although I don't have tor set up so don't know.

garethsprice• 14 years ago

$1m / 5200 = $192 average order.

With a conservative estimate of 3x markup on product (seems way high, especially if these guys were just middle men), $20 shipping (national, Fedex) and 0 hosting costs they're making 192-(64+20) = $108 per order.

$108 * 5200 = 561,600 / 2 / 8 = $35,000 per person per year, or $16 an hour if it was a full-time job.

Considering that anyone with the skills to set up an anonymized marketplace site should be able to find work that pays far more than $16/hr this seems like more an ideological exercise or hobby than a money-making cartel.

Whether or not you consider it to be worth spending probably $3m+ on investigating, trying and imprisoning these 8 people is another ideological question...

xal• 14 years ago

8x life in prison for $1M in drug trafficking?

tibbon• 14 years ago

Costing society probably $100K/yr/each to imprison them.

ajays• 14 years ago

Nope. It costs close to $30K/year to imprison somebody in the US. So make that $250K/year to imprison this sorry bunch.

taligent3• 14 years ago

That's maximum life in prison.

aviv• 14 years ago

If these guys were using e-gold or some other alternative payment system, the Feds would raid the currency operator's offices as well and seize servers (as they have done in the past). Not so with PayPal and Western Union (I'm not disagreeing with the lack of such action).

thinkdevcode2• 14 years ago

So were they actually selling the drugs or were they just operating a marketplace similar to Silk Road?

Also, why the hell would they use PayPal?! At least SR uses bitcoins.

loverobots2• 14 years ago

Looks like Hushmail was their weak point. Feds got court order from Canada based on treaty and it flowed from there.

But yeah, between advertising, shipping, getting paid and moving money around it's hard to stay anon .

cookiecaper2• 14 years ago

I never understand why people have such a fundamentally difficult time grasping the concept of plaintext and/or subpoenas. If someone knows enough to trade drugs on Tor, they definitely should be using strong encryption on anything and everything pertaining to it, including email.

Month after month handfuls of new stories come out about someone outed and/or owned by emails or other plaintext communication that was not encrypted or cryptographically signed. You'd think it'd sink through after a while.

You have no reasonable expectation of security for anything that is not fully encrypted with vetted, real-world strong encryption. While you may want something to stay under wraps, you're just leaving it there for the taking unless it is stored on permanent storage only in encrypted form.

rorrr3• 14 years ago

My theory is that only idiots get caught. If you read the article, it was a tiny operation considering the global illegal drug market. They only sold $1M worth of drugs in three years, that's silly.

They didn't catch some big fish criminals, they caught some idiot kids who thought they could easily make money.

nowarninglabel3• 14 years ago

Hushmail has been known to be open to law enforcement for years, they even talk about it in "Kingpin", http://www.wired.com/threatlevel/2007/11/hushmail-to-war/

Amazing they would choose to communicate over it.

duaneb• 14 years ago

Why on earth would an online drug marketplace use traceable currency? Silk road got it right using BC.

donniezazen• 14 years ago

Reuters.com pulled it off.

joshu2• 14 years ago

Web page is dead.

Was this silk road? I've been meaning to scrape prices from there as a pet economics project.

jmtame4• 14 years ago

No, the project was called The Farmer's Market. While it operated on Tor, they accepted payments over PayPal which completely breaks the anonymity chain. Silk Road is still operational and uses other security mechanisms (in addition to a decentralized, digital anonymous currency) to further anonymize transactions, running all payments through a tumbler.

joshu2• 14 years ago

Someone should write up a tour guide to the deep dark web.

I doubly wish I was indexing silkroad's prices, so we could see the price impact this event has.

waterhouse• 14 years ago

Looks like this is a working link: http://www.reuters.com/article/2012/04/17/net-us-usa-drugs-i...

The new url has "net-" in it.

cypherpunks012• 14 years ago

It doesn't appear that I can edit the URL anymore :(

redthrowaway• 14 years ago

When I saw the title, I immediately assumed it was Silk Road. That would have surprised me, as the operators have no part in the actual business, and all trades are conducted with bitcoins. If Silk Road went down, that would be news, as they really embrace strong crypto and opsec.

U.S. busts Tor drug market, arrests eight

Related Stories