Teenager Jailed for Selling €4 Million Worth of Drugs on the Dark Net

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Dubbed by German newspapers as the “Bedroom Dealer,” Maximilian S. was an aspiring drug kingpin who ran an entire operation for two years out of his mother’s flat. Having sold a mixed bag of tablets, hashish and LSD (valued at around €4 Million) for bitcoin across the dark web under the screen name Shiny Flakes, Maximilian was finally caught when a neighbor illegally went through a package waiting on Maximilian’s doorstep. According to Norbert Goebel, the presiding judge at the Saxony state high court in Leipzig, the teen had been engaging in “highly criminal activity” since 2013, and facilitated the movement of “almost a ton of narcotics.” Upon raiding Maximilian’s house in Leipzig last February, the police found an assortment of drugs weighing around 300 kilograms, along with €48,000 in cash. The Bedroom Dealer’s one-man operation had been one of the most sophisticated in its nature. He had rented servers in Netherlands, used a group of IP addresses throughout Germany, and even opened multiple bank accounts under fake IDs to channel his profits through. During trial, a psychiatric evaluation of Maximilian showed that he had signs of “disturbed social behavior”, lacking emotional security. His 48-year-old mother, who was not allowed …

Multi-Million Dollar ‘Grandmother Scam’ Using Bitcoin Ends in Miami

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A Canadian man who devised an elaborate scheme to defraud elderly U.S. citizens while using monetary transmitters like Western Union and Bitcoin has been caught. Stephan Moskwyn is looking at up to thirty years in federal prison for money laundering and related crimes performed in Southern Florida. Scammed grandparents into thinking relatives were in financial trouble The basic premise was simple: Call the large elderly population in Florida from a Canadian call center and purport to be a grandchild or other relative in need of money, due to a legal issue or accident. The callers would have them send the funds in the form of pre-paid debit cards, or money orders via Western Union, which would later be cashed in foreign markets like Chile and the Dominican Republic. Then “virtual money orders” were converted to Bitcoin by Moskwyn. He had bought pre-paid debit cards in Miami-Dade and Broward counties to execute the scams, which is when he met with witnesses who were working for federal law enforcement, according to documents submitted to the court. Those who were scammed would even go the extra mile to help, sending more funds than requested multiple times, according to federal investigators. U.S. Attorney Wifredo …

Illicit Middle Earth Marketplace Possibly Exploited, IP Discovered

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For any unknown terms or phrases, please look at our “dark net market” terminology guide. Reddit user “haxforcrack” posted today on “/r/DarkNetMarkets,” to inform the community of exploits for black Tor market “Middle Earth.” The user’s discoveries include the server’s IP address and “stack,” or configuration. The user claims to have reached out to site administrators, deciding to go public when no response was received. For a hidden black market, having a server expose it’s IP address is one of the greatest fears an operator may face. A Tor hidden service hides IP addresses, and it is up the service’s operator to secure the service properly to hide the IP address from potential exploits. The address may allow law enforcement to discover the server’s location, and even copy all data from the server during it’s operation. According to “haxforcrack,” the server is an Ubuntu Linux system running Nginx, MySQL, and Django. A “cross-site request forgery” error page printed an insecure Django version, which was then exploited using a well known and currently fixed exploit to print the IP address. When “haxforcrack” defended the exploit’s release, he said, “…trust me if I found it as quickly as I did LE already knows about it.” …

Bitcoin in the Headlines: Child Porn and Price Disregard

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Whils last week’s reporting was heavily US-focused, the coverage this week was more far reaching, with outlets from India and Russia mentioning bitcoin – even if in a negative light. Indeed the biggest lightning rod of interest this week was perhaps bitcoin’s alleged propensity for enabling illicit activities, with the use of the payment method in online child pornography transactions capturing the lion’s share of the media’s headlines. Interestingly this focus, however, did deflect from other negative coverage. For example, bitcoin’s relative price drop – usually a hot topic among the mainstream press – went mostly unnoticed. Child porn for bitcoin Allegations that paedophiles are now buying sexually abusive imagery on the web first surfaced this week following the release of the Internet Watch Foundation’s annual report. Unsurprisingly, it did not take long for the media to seize the opportunity to report on the link between the disruptive digital currency and the horrendous activities carried out by some alleged bitcoin users. A Google news search with the terms “paedophiles and bitcoin” brought up more than 80 results, significantly less than previous stories highlighted in this series, but still this week’s most widely covered topic. In his Guardian piece “Paedophiles sell child abuse images …