The dark web, having gained a reputation for offering illicit goods and narcotics, caught the attention of authorities after the Silk Road fueled much early Bitcoin price activity. Law enforcement’s subsequent focus on the dark web continues to this day. “We are well aware of these websites” authorities in Australia said in September.
In the US, the Department of Justice announced charges October 6 against Michael Richo, 34, of Wallingford, Connecticut on a criminal complaint charging him with access device fraud, computer fraud, wire fraud, identity theft and money laundering offenses tied to his phishing to steal bitcoins.
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation filed the complaint, which alleges Richo partook in an online phishing scheme to steal bitcoins from people on the dark web, where the crypto-currency is often accepted as a payment means.
Richo allegedly posted fraudulent links to online marketplaces on dark web forums. Users were brought to a fake login page made to look like the proper login page for online marketplaces. Richo then stole usernames and passwords and monitored people’s bitcoin balances on the darkweb marketplace they had intended to log into. When bitcoins were deposited, Richo withdrew them and sent them to his own bitcoin wallet.
Richo saved more than 10,000 usernames and passwords on his computer. Richo appeared before U.S. Magistrate Judge Sarah A.L. Merriam in New Haven. He was released on a $100,000 bond.
Richo faces 20 years in prison for money laundering, another 20 years for wire fraud, 10 years for access device fraud, five years for computer fraud and two years for each identity theft.
Bitcoin has been called money in other court cases, such as the court case of Trendon Shavers, in which the defendant was accused of running bitcoin’s first major ponzi scheme.
See complaint here.