Peter Singer, an Australian moral philosopher, said that “the Internet, like the steam engine, is a technological breakthrough that changed the world.” With the widespread adoption of the internet as a daily tool in our lives, it has also become a home to criminals because there is virtually no prosecution laws on the internet. We’re never taught about the dangerous parts of the web — the bowels of the internet where murderers, thieves, and hackers live.
The creator of Silk Road went by the name Dread Pirate Roberts to protect his criminal identity. People used the marketplace to spend billions of untraceable dollars on anything from Scopolamine to hitmen, to virtually anything else a criminal could put a price point on. Due to the illegal nature of the business, Roberts could not risk revealing his identity to anybody. “Meeting in person is out of the question,” he says. “I don’t meet in person even with my closest advisors.” Roberts managed to create the largest modern marketplace on the dark web, a feat which caught the attention of the Drug Enforcement Administration, the Federal Bureau of Investigation, among handfuls of other intelligence agencies worldwide.
Silk Road became so popular in such a short time because of its ease of use. Simply download Tor, exchange your local currency for Bitcoin, and then go shopping for some vacuum-sealed heroin or cocaine. Within days, could be delivered to your doorstep via the United States Parcel Service, right under the government’s nose. Roberts saw himself as a radical libertarian with a message for the masses. “We can’t stay silent forever. We have an important message, and the time is ripe for the world to hear it. What we’re doing isn’t about scoring drugs or ‘sticking it to the man.’ It’s about standing up for our rights as human beings and refusing to submit when we’ve done no wrong.”
Roberts helped make Bitcoin mainstream, and the cryptocurrency can now be used for purchasing anything from a new phone to clothing to plane tickets. Bitcoin is transmitted throughout a network of computers across every country in the world; Silk Road decreased the chances of being traced even more by running its own in-house money laundering service.
Bitcoin's value versus the Canadian Dollar
Coincidentally messages from the staff of Silk Road, the web’s most secretive drug marketplace, were leaked. The conversation began as Roberts simply tracking down a blackmailer, then escalates to hiring a hitman to kill him, before he pays for the death of four additional people.
3/29/2013 22:55: “Hi again R&W, I hate to come to you with a problem when we are just starting to get to know one another, but Blake (FriendlyChemist) is causing me problems. Are you still looking for him or now that you’ve found Xin have you given up? I would like to put a bounty on his head if it’s not too much trouble for you. What would be an adequate amount to motivate you to find him?”
As the internet balloons into an essential part of our daily lives, it is becoming easier for people to commit criminal acts without the risk of being caught. Although the website warned not to “list anything who’s [sic] purpose is to harm or defraud, such as stolen items or info, stolen credit cards, counterfeit currency, personal info, assassinations, and weapons of any kind,” this rule was not enforced and allowed murderers and credit card thieves to sell their services to anybody who’s interested.
Silk Road’s growth meant that people who didn’t understand the meaning or dangers of using the site began to sell their products on the marketplace. Vendors used regular email services like Gmail, shared tracking numbers, and got lazy with encryption. “It really blows my mind how some people choose to vend on here without knowing, well, shit,” HEATfan wrote. It began to get to the point where Silk Road users needed to be protected from themselves.
3/31/2013 8:59: “Don’t want to be a pain here, but the price seems high. Not long ago, I had a clean hit done for $80k. Are the prices you quoted the best you can do? I would like this done asap as he is talking about releasing the info on Monday.”
Roberts unapologetically admitted to being “a little disturbed” and “just new to this kind of thing is all.” He didn’t know, however, that the man he had paid for the murder was a U.S. federal agent, and the murder was staged. He spent the next few months spending money defending Silk Road — and himself, by purchasing nine fake IDs which were all intercepted at the Canadian-American border — from the FBI.
Since then, a criminal complaint has been launched against Ross William Ulbricht, the man behind the screen name ‘Dread Pirate Roberts’. Although the value of bitcoin changes over time, the complaint alleges that 1,229,465 transactions totalling $1.2 billion USD were performed between Feb 6, 2011 and July 23, 2013. Silk Road, and effectively Ulbricht, took a hefty $79.8 million in commission.
“This is supposed to be some invisible black market bazaar. We made it visible,” said an FBI spokesperson. “He said he would never be arrested. But no one is beyond the reach of the FBI. We will find you.”
Keeping to its promise, the FBI shut down the Silk Road successors that were created after the destruction of the original. ‘Silk Road 2.0’ and ‘Silk Road 3.0’ were created in November 2013 in hopes of capitalizing on the already large group of people who were hungry for their drug fixes. Beside the brief successors of Silk Road stood other more prominent drug marketplaces, such as Evolution. In March of 2015 when the German police raided the home of a seller on the marketplace, they seized over one-third of a ton of narcotics — and realized how truly large the world of online drug selling is.
The most popular drugs on Silk Road
Criminals who call the internet home aren’t only drug dealers, murderers-for-hire, and child pornographers, however — they’re also rich billionaires storing their wealth in offshore accounts and governments spying on their own citizens, a la NSA-style. Laws put in place to protect people on the internet are either failing to do what they are set out to do, or allowing people to continue committing illegal activities on because of glaring loopholes. Even more worrying that according to a report by the Carnegie Mellon University, Canada ranked the fifth top seller and buyer of drugs on Silk Road. Unsurprisingly developed countries have a much higher drug problem than those that are undeveloped, but there is little by the way of legislation in place to deter the use of heavy drugs such as cocaine, heroin, and meth. Even more worrying is the amount of drugs that are reaching youth because of the increasing supply of drugs.
The Panama Papers are a leak of 11.5 million files concerning clients of the world’s fourth biggest law firm, Mossack Fonseca. These documents show the vast amount of people exploiting offshore accounts in order to save millions of dollars in taxes. Among these people include Vladimir Putin, Pakistan’s Prime Minister Nawaz Sharif, and Ian Cameron, father of a former British Prime Minister.
David Cameron was elected as the Prime Minister of the United Kingdom in 2015. His father made an honest living as a director at Blairmore Holdings Inc., until April 2016 when it was discovered that he was running an offshore fund. The company was operated by hundreds of Bahamas residents signing paperwork and filling ‘dummy roles’ such as treasurer and vice president, and utilized bearer shares, which do not carry the name of the owner.
It has been discovered since the leak that Vladimir Putin also held up to $2 billion offshore. Putin’s shares of several major Russian companies make up about half of the money stored offshore, while the other $1 billion came in the form of a series of large, unorthodox credit lines from Bank Rossiya, headed by a very close friend of Putin’s, Yuri Kovalchuk. Use of offshore accounts goes against Putin’s recent call for “deoffshorization,” urging Russians to transfer cash hidden overseas back into the country. Other wealthy friends of the President’s who are making use of offshore accounts include oil-trader Gennady Timchenko, billionaires Arkady and Boris Rotenberg, and Alisher Usmanov, owner of six large, and very successful companies.
People of all socioeconomic statuses utilize offshore accounts to have anywhere from hundreds to millions of dollars that would otherwise be collected as tax. There is a set of basic requirements to open an account which usually are indifferent than those of opening an account with your local bank; a passport or driver’s license, proof of address, and some money to get started. Precautions to weed out laundering are constantly failing, and although U.S. authorities have fined banks up to $1.9 billion for allowing drug dealers and terrorists to move billions of dollars throughout the banking system. HSBC, the world’s fourth largest bank, blindly accepted upwards of $881 million from Mexican drug cartels, and also helped countries like Libya, Sudan, and Iran get around U.S. rules banning their presence in the financial system.
Criminals launder between $500 billion and $1 trillion dollars each year, which results in staggering effects throughout the world. On one side when criminals can successfully launder money, it proves that crime does pay off. Developing countries bear the weight of money laundering because they’re governments do not usually have established regulations for the financial sector. In the 1990s it was rumored that ‘dirty money’ was being deposited into the Baltic Nations, and customers withdrew all their money in order to protect it if the banks came under investigation; as a result all major banks collapsed. The effects of this spread throughout the country, and people are forced to pay extra taxes to make up for the government’s lost revenue. The main effect of successfully laundering money is evident: more drugs, crime, more illegal money being passed around. Supporters of terrorist groups and terrorists looking to purchase illegal goods don’t simply write out cheques; they move money around to tens or hundreds of accounts in different countries to make the money near-impossible to trace.
New online money conversion services are making it incredibly easy for people to launder money without being caught. Previously people could use a Costa Rican-based service called Liberty Reserve, which would convert US Dollars into a digital currency called “Liberty Reserve Dollars,” which could then be converted back into cash for a small processing fee. Even though the service has been shut down by US Officials, many services of the same capacity have since popped up online. Online games (including those that you can see on social networks, such as Facebook as well as multiplayer online games like World of Warcraft and Second Life) allow you to exchange real money for digital goods and currency, and then convert the digital currency back into cash at a later date.
In May of 2013, filmmaker Laura Poitras reached out to Barton Gellman of the Washington Post. “Laura asked if I could meet to talk about something confidential. And we both knew what she meant by confidential. She wanted to make it as private as we could make it.” She had just been reached out to over the internet by someone named ‘Verax’, and it would later be discovered that this anonymous figure was actually Edward Snowden, the man who brought the National Security Agency’s mass spying programs to light.
In a series of leaked documents, the NSA laid out how they were able to — and did — spy on virtually every phone call, email, and text message exchange. But the NSA, an agency tasked with protecting the United States, also spied on hundreds of millions of people in other countries around the world, courtesy of government agencies worldwide. The NSA defended its actions with a simple proclamation: if American citizens have nothing to hide, they have nothing to fear. United States Supreme Court Justice Breyer explained:
The NSA was able to build a map filled with patterns from your cell phone, laptop, messaging apps, and virtually any other device that connects to the internet. What makes this spying worse is that it wasn’t just suspected terrorists who were spied on — it could reach as far as the best friend of a terrorist’s boss’s son’s teacher’s second cousin. Put bluntly, nobody was safe; not even people living outside the borders of the United States where the NSA supposedly had no jurisdiction.
Whistleblowing has been in the news recently as a major controversy due to the rise of websites like WikiLeaks which make it incredibly simple for someone to become a whistleblower. Daniel Ellsberg simply copied the Pentagon Papers — a top secret study on the United States involvement in the Vietnam war between 1945 and 1967 — and sent a copy of them to The New York Times. Spectacles like the NSA Scandal and Pentagon Papers spark a debate: is whistleblowing necessary in order to keep governments accountable? The technology that whistleblowers use has changed drastically throughout time. First writing allowed people to convey wrongdoings, then the introduction of photocopiers allowed them to supply the press with a copy of actual documents, and finally the rise of the internet allows these daring souls to simply leak files to the world through a simple email.
However although whistleblowers often do what is in the interest of the public, they are offered no protection under the law. Although United States President Barack Obama issued an order extending protections to whistleblowers employed at Intelligence Agencies in the country, the law, titled Presidential Policy Directive 19, did not extend to government contractors employed by third party companies. As Edward Snowden found out, this is where there is a grey line; it has been said that he should have come forward to the higher-ups at the NSA, but Edward himself stated that ”If I had revealed what I knew about these unconstitutional but classified programs to Congress, I could have been charged with a felony.” In another case of whistleblowing, Thomas Drake used the proper procedure to make a report about the cost and lack of privacy concerns about a secret program called “Trailblazer,” and reached out to his supervisor, the Office of the Inspector General, and the Congressional Intelligence Committee. The NSA then changed his job to nothing more than filing papers and forced him to resign in 2008 after making his job hell, he explained that ”there’s nothing within the act that actually protects you. I don’t have cause of action - I can’t go to the courts for redress.” Recently the Department of Justice took a step back and announced that they will not be seeking the death penalty for Edward Snowden, instead settling on charges for theft and espionage.
Through the mishap of a 2007 breach in which 45.6 million credit card numbers were stolen from TJX, the owner of Winners and HomeSense, companies are getting better at detecting credit card breaches earlier. However, it is becoming less profitable to steal credit card numbers and sell them on the black market — the value of a single stolen card is now only 30 percent of what it was five years ago. When you think of credit card theft, usually you would think of criminals selling millions of credit card numbers to thieves or people who launder money. But as the price of this data goes down, the amount of people willing to purchase it oddly decreases. With the value decreasing the next logical step is to sell it back to the company that you sold it from; this way the thieves are almost always guaranteed a payout because the companies would rather keep the fact that their customer’s data was stolen quiet.
It is a completely different situation, however, if victims can be persuaded to buy back their own property, generally through ransomware attacks (holding their computer or phone hostage until they pay you a sum of money, usually ranging between a few hundred dollars and a thousand). This new tactic allows criminals to transform virtually worthless data into an invaluable asset. Think about this situation a different way: how much would you pay to get back the only copies of your daughter’s childhood photos?
The increasingly simple method of extorting people’s money explains why ransom is becoming more common. In 2015 the FBI reported $1 billion in losses through 288,012 cases, with the average payout per person extorted being $560. Unfortunately it is not publicly known how many companies purchase stolen data to protect users because it is a practice that they do not like to publicize.
Extortion is not only being targeted at technology companies, and it is evident that criminals have no limits from the attack on the Hollywood Presbyterian Medical Center. Initially the hospital had no plan of paying out the $3.82 million in Bitcoin that the hackers had requested and instead were forced to abandon their computer systems in favor of pen and paper, but later negotiated the payment down to $17,000. This is a dangerous act for a hospital, or any company, to commit because it shows the hackers that they are willing to pay out money if they are hacked and how much the hackers should be asking for. The practice is so easy that “a first-year computer-science student can do it and then you just sit back and wait for the money to hit your account.” As other online technologies continuously make strides and advancements, such as Bitcoin, money-related crimes greatly increase in quantity. In the cases where someone does have to pay out, they are most likely the ones who are responsible for the breach because of clicking on a link to a dangerous website or opened an attachment that installed ransomware. Furthermore, when you pay for your data back, you don’t physically get your data back; you simply pay for the silence of the person who stole your data. “There’s nothing to buy back—you’re buying the silence of whoever has stolen it. There’s a much clearer case historically for buying back stolen goods that belong to you than there is for buying the silence of someone who’s committed a crime.” This is not only the case for individuals, as the FBI’s Cyber Division chief points out: “The latest trend we’re seeing is a company will attempt to negotiate with the criminal and then they pay and the next day the criminals want more money.”
Most people don’t realize that they can typically prevent a situation of extortion from happening in their lives by doing simple things such as not clicking on suspicious links and keeping backups of their important data on a USB drive. This presents a debate of whether the person deserves to pay the ransom because of their recklessness on the internet. There is also no current guidelines on this predicament from the government on whether individuals should simply pay out the ransom or report it to the authorities for them to handle; there is also no stance in current legislature whether the practice of paying criminals in order to secure your digital belongings is legal. An assistant general counsel at the FBI’s Cyber Law Unit says that “in the vast majority of situations, you would not be breaking the law when you do that, and it’s certainly not something the FBI would pursue in an investigation”; this statement is quite ambiguous and vague and does not exactly state the government’s stance on the issue. It is evident that as long as money can be made through ransom, it will continue to thrive as a business model for criminals looking to make easy money.
These days, everybody uses the internet and we need laws made to protect ourselves from criminals (and worse) in this new and exciting online world.
In order to fully protect people on the internet, we need a set of universal laws and guidelines put in place to thwart criminal behavior. As children we’re taught the basic safety rules of the internet, such as being nice and not posting anything mean, asking someone before going on a website we don’t recognize, and only using the computer where our parents can see us. The older we get, the more prone we are to discovering the darker and more dangerous side of the internet, on which we have no idea how to protect ourselves. In Britain there has been some progress on an internet reform, with the introduction of revenge porn as a criminal offense, which makes it illegal to share a sexual video of someone without their consent with the intent to cause them distress. This is only the first step in a much-needed improvement of internet laws, and it is being argued that these laws need to be updated further and that internet companies should do more to prevent the spreading of abusive and threatening material online. Britain’s Senator Tory stated that ““We need better laws and we need better enforcement. Government needs to stop allowing internet providers from hiding behind arguments about the protection of free speech,” referring to the common practice of companies using the equivalent of their free speech rights to protect users’ harmful posts on their platforms.
When our digital lives are interrupted through means of cybercrime or online harassment, it feels as though it should be against the law. Current laws are not doing the job they were intended to. “It’s disgusting. The law needs to be changed, and we need to change.” There are currently ways that victims can get retribution for crimes against them, but these are only successful if the person who committed the crime is caught and even then, it’s a time consuming and costly procedure. The law is incredibly slow to adapt to new technology and by the time it does, the damage is already done in many people’s lives. Therefore there is little protection that the law can offer you, and until it does evolve into a functioning system, it’s up to you to protect yourself on the internet.
To prevent cyber crime, you should be constantly updating your passwords on all websites every year or so and make sure to use different passwords for each service that you sign up for; this makes it much harder for hackers to gain access to your personal information to sell on a black market. It is also imperative to make sure that your social media settings are set to private, and that only your friends are able to view your profile. Hackers will often download millions of online social media records with the hope of discovering hints that may help them gain access to your accounts or to learn more about you and your habits with the same hopes. Using public Wi-Fi hotspots is also incredibly dangerous because they can be set up by virtually anybody, and can easily be named after a trustable business such as “McDonalds WiFi” or “Starbucks Free WiFi.” If you join an untrusted network, you chance having your personal information intercepted by anybody, including passwords, credit card data, and anything else that you store on your device. It is also important to be aware of what websites you are browsing on the internet and what links you click. Hackers can disguise a malicious link as one that might seem trustworthy, such as a link to Google, and in turn turn your computer into nothing more than a paperweight. Finally, be weary of who you give personal information out to online, such as your full name, address, phone number, or financial info. Make sure that there’s a lock icon in the URL bar when you’re filling out a form requesting your address or credit card number so that you know only the business or organization requesting the information is receiving it.
Although the internet is a revolutionary invention that has vastly improved the lives of billions of people around the globe, it is also a place riddled with unsuspected dangers. We have learned from Dread Pirate Roberts,
The internet, as great an invention it is, is a place riddled with unsuspected dangers. As evident from the Silk Road Scandal, the internet is home to much more than is visible to the naked eye. Dread Pirate Roberts was able to operate a billion dollar drug marketplace for years before he was caught by law enforcement. In the process he had several people murdered in cold blood, and sold hard drugs in every country in the world.
With the rise of money laundering we can also see that billions of dollars are not actually going to fund social services and is instead being held offshore by greedy millionaires whose only motive is to spend the least amount of money in taxes as possible. The Panama Papers only proved that there is more money laundering happening throughout the world on a much larger scale than we once thought. When we see more crime happening on the internet, our instincts should tell us that we must stop the epidemic or blow the fire out before it evolves into something much bigger. Furthermore, we must pressure governments into changing legislature to protect its citizens on the internet, especially younger people who are new to the internet and are yet to become aware of the dangers that reside on it.
Dave Barry said “the Internet is the most important single development in the history of human communication since the invention of call waiting,” and we must work together as a society to transform it into a place that is free of danger and that is safe for all people.
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