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November 19, 2019
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Blockchain

World’s Largest Cryptocurrency-Fueled Darknet Child Pornography Website Hammered – 300+Busted

U.S. and Korean authorities have simply revealed their bust of one of many world’s largest markets for youngster pornography, a criminal offense that’s proliferating at a livid tempo with the rise of cryptocurrency.

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The Darknet web site that operated the market, accepted Bitcoin and distributed a couple of million sexually specific movies involving youngsters. These companies analyzed the blockchain and have been in a position to de-anonymize Bitcoin transactions, permitting for the identification of tons of of predators around the globe.

The operation resulted within the seizure of roughly eight terabytes of kid sexual exploitation movies, which is likely one of the largest seizures of its sort.  The pictures, that are at the moment being analyzed by the National Center for Missing and Exploited Children (NCMEC), contained over 250,000 distinctive movies, and 45 % of the movies at the moment analyzed include new pictures that haven’t been beforehand identified to exist.

Notably, the operation is answerable for the rescue of a minimum of 23 minor victims residing within the United States, Spain and the United Kingdom, who have been being actively abused by the customers of the positioning.

According to a US Department of Justice information launch, a nine-count indictment was unsealed together with a parallel civil forfeiture motion in opposition to Jong-Woo Son, 23, a South Korean nationwide, who was indicted by a federal grand jury within the District of Columbia for his operation of Welcome To Video, the most important youngster sexual exploitation market by quantity of content material.   

And a further 337 web site customers residing in Alabama, Arkansas, California, Connecticut, Florida, Georgia, Kansas, Louisiana, Maryland, Massachusetts, Nebraska, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Texas, Utah, Virginia, Washington State and Washington, D.C. in addition to the United Kingdom, South Korea, Germany, Saudi Arabia, the United Arab Emirates, the Czech Republic, Canada, Ireland, Spain, Brazil and Australia have been arrested and charged.   

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Jessie Okay. Liu for the District of Columbia, Chief Don Fort of IRS Criminal Investigation (IRS-CI) and Acting Executive Associate Director Alysa Erichs of U.S. Immigration and Customs Enforcement (ICE)’s Homeland Security Investigations (HSI), made the announcement.

“Darknet sites that profit from the sexual exploitation of children are among the vilest and reprehensible forms of criminal behaviour,” stated Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “This Administration will not allow child predators to use lawless online spaces as a shield.  Today’s announcement demonstrates that the Department of Justice remains firmly committed to working closely with our partners in South Korea and around the world to rescue child victims and bring to justice the perpetrators of these abhorrent crimes.”

“Children around the world are safer because of the actions taken by U.S. and foreign law enforcement to prosecute this case and recover funds for victims,” stated U.S. Attorney Jessie Okay. Liu.  “We will continue to pursue such criminals on and off the darknet in the United States and abroad, to ensure they receive the punishment their terrible crimes deserve.”

“Through the sophisticated tracing of bitcoin transactions, IRS-CI special agents were able to determine the location of the Darknet server, identify the administrator of the website and ultimately track down the website server’s physical location in South Korea,” stated IRS-CI Chief Don Fort.  “This large-scale criminal enterprise that endangered the safety of children around the world is no more.  Regardless of the illicit scheme, and whether the proceeds are virtual or tangible, we will continue to work with our federal and international partners to track down these disgusting organizations and bring them to justice.”

One nameless supply advised Blockchain News that there are a number of blockchain-agnostic search and analytics intelligence corporations at the moment working with regulators on forensic investigations wanted to catch non-compliant crypto criminals.

“Children are our most vulnerable population, and crimes such as these are unthinkable,” stated HSI Acting Executive Associate Director Alysa Erichs.  “Sadly, advances in technology have enabled child predators to hide behind the dark web and cryptocurrency to further their criminal activity.  However, today’s indictment sends a strong message to criminals that no matter how sophisticated the technology or how widespread the network, child exploitation will not be tolerated in the United States. Our entire justice system will stop at nothing to prevent these heinous crimes, safeguard our children, and bring justice to all.”

Welcome To Video bought movies for bitcoin and is among the many first of its sort to monetize youngster exploitation with cryptocurrency and the positioning itself boasted over a million downloads of kid exploitation movies by customers.  An evaluation of the server revealed that the web site had a couple of million bitcoin addresses, signifying that the web site had the capability for a minimum of a million customers. 

Amongst the positioning’s customers charged are:

Charles Wunderlich, 34, of Hot Springs, California, was charged within the District of Columbia with conspiracy to distribute youngster pornography;
 
Brian James LaPrath, 34, of San Diego, California, was arrested within the District of Columbia, for worldwide cash laundering; and was sentenced to serve 18 months in jail adopted by three years of supervised launch;
 
Ernest Wagner, 70, of Federal Way, Washington, was arrested and charged within the District of Columbia with conspiracy to distribute youngster pornography;
 
Vincent Galarzo, 28, of Glendale, New York, was arrested and charged within the District of Columbia with conspiracy to distribute youngster pornography;
 
Michael Ezeagbor, 22, of Pflugerville, Texas, was arrested and charged within the District of Columbia with conspiracy to distribute youngster pornography;
 
Nicholas Stengel, 45, of Washington, D.C., pleaded responsible to receipt of kid pornography and cash laundering and was sentenced to serve 15 years in jail adopted by a lifetime of supervised launch;
 
Eryk Mark Chamberlin, 25, of Worcester, Massachusetts, pleaded responsible to possession  of kid pornography and is pending sentencing;
 
Jairo Flores, 30, of Cambridge, Massachusetts, pleaded responsible within the District of Massachusetts to receipt and possession of kid pornography and was sentenced to serve 5 years in jail adopted by 5 years of supervised launch;
 
Billy Penaloza, 29, of Dorchester, Massachusetts, pleaded responsible within the District of Massachusetts to possession and receipt of kid pornography. His sentencing is scheduled for Oct. 22, 2019;
 
Michael Armstrong, 35, of Randolph, Massachusetts, pleaded responsible within the District of Massachusetts, to receipt and possession of kid pornography. He was sentenced to serve 5 years in jail adopted by 5 years of supervised launch.  Restitution can be decided at a future date;
 
Al Ramadhanu Soedomo, 28, of Lynn, Massachusetts, pleaded responsible to possession of kid pornography and was sentenced within the District of Massachusetts (Boston), to serve 12 months and in the future adopted by 5 years of supervised launch;
 
Phillip Sungmin Hong, 24, of Sharon, Massachusetts, pleaded responsible within the District of Massachusetts (Boston), to receipt and possession of kid pornography and is pending sentencing;
 
Eliseo Arteaga Jr., 28, of Mesquite, Texas, pleaded responsible within the Northern District of Texas to possession of prepubescent youngster pornography. He is pending sentencing;
 
Richard Nikolai Gratkowski, 40, of San Antonio, Texas, a former HSI particular agent, was arrested within the Western District of Texas.  Gratkowski pleaded responsible to the indictment charging one rely of receipt of kid pornography and one rely of entry with intent to view youngster pornography.  Gratkowski was sentenced to serve 70 months in jail adopted by 10 years of supervised launch, and ordered to pay $35,000 in restitution to seven victims and a $10,000 evaluation;
 
Paul Casey Whipple, 35, of Hondo, Texas, a U.S. Border Patrol Agent, was arrested within the Western District of Texas, on prices of sexual exploitation of kids/minors, manufacturing, distribution, and possession of kid pornography.  Whipple stays in custody awaiting trial in San Antonio;
 
Michael Lawson, 36, of Midland, Georgia, was arrested within the Middle District of Georgia on prices of tried sexual exploitation of kids and possession of kid pornography.  He was sentenced to serve 121 months in jail adopted by 10 years of supervised launch following his plea to a superseding info charging him with one rely of receipt of kid pornography;
 
Kevin Christopher Eagan, 39, of Brookhaven, Georgia, pleaded responsible to possession of kid pornography within the Northern District of Georgia;
 
Casey Santioius Head, 37, of Griffin, Georgia, was indicted within the Northern District of Georgia for distribution, receipt, and possession of kid pornography;
 
Andrew C. Chu, 28, of Garwood, New Jersey, was arrested and charged with receipt of kid pornography. Those prices stay pending;
 
Nader Hamdi Ahmed, 29 of Jersey City, New Jersey, was arrested within the District of New Jersey, for sexual exploitation or different abuse of kids.  Ahmed pleaded responsible to an info charging him with one rely of distribution of kid pornography.  He is scheduled to be sentenced Oct. 1, 2019;
 
Jeffrey Lee Harris, 32, of Pickens, South Carolina, pleaded responsible within the District of South Carolina for producing, distributing, and possessing youngster pornography;
 
Laine Ormand Clark Jr., 27, of Conway, South Carolina, was arrested and charged in U.S. District Court in South Carolina Division for sexual possession of kid pornography;
 
Jack R. Dove III, 38, of Lakeland, Florida, was arrested within the Middle District of Florida for knowingly receiving and possessing visible depictions of minors engaged in sexually specific conduct;
 
Michael Matthew White, 39, of Miami Beach, Florida, was arrested within the Southern District of Florida for coercion and enticement;
 
Nikolas Bennion Bradshaw, 24, of Bountiful, Utah, was arrested within the State of Utah, and charged with 5 counts of sexual exploitation of a minor, and was sentenced to time served with 91 days in jail adopted by probation;
 
Michael Don Gibbs, 37, of Holladay, Utah, was charged within the District of Utah with receipt of kid pornography and possession of kid pornography;
 
Ammar Atef H. Alahdali, 22, of Arlington, Virginia, pleaded responsible within the Eastern District of Virginia to receipt of kid pornography and was sentenced to serve 5 years in jail and ordered to pay $three,000 in restitution;
 
Mark Lindsay Rohrer, 38, of West Hartford, Connecticut, pleaded responsible within the District of Connecticut to receipt of kid pornography and was sentenced to serve 60 months in jail adopted by 5 years of supervised launch;
 
Eugene Edward Jung, 47, of San Francisco, California, was indicted within the Northern District of California on possession of kid pornography and receipt of kid pornography;
 
James Daosaeng, 25, of Springdale, Arkansas, pleaded responsible to possession of kid pornography and was sentenced within the Western District of Arkansas (Fayetteville) to serve 97 months in jail adopted by 20 years of supervised launch;
 
Alex Daniel Paxton, 30, of Columbus, Ohio, was arrested and indicted in Franklin County Ohio Court of Common Pleas for pandering sexually oriented matter involving a minor;
 
Don Edward Pannell, 32, of Harvey, Louisiana, pleaded responsible within the Eastern District of Louisiana for receipt of kid pornography. He is pending sentencing;
 
Ryan Thomas Carver, 29, of Huntsville, Alabama, was arrested and charged underneath Alabama State Law.  He was charged federally within the Northern District of Alabama with possession of kid pornography. His case is pending in Huntsville, Alabama;
 
Andrew Buckley, 28, of the United Kingdom, pleaded responsible to 10 offences within the UK of possession and distribution of indecent pictures of kids, possession of utmost and prohibited pictures and possession of a category A drug.  He was sentenced to serve 40 months in jail for the distribution of indecent pictures and possession of sophistication A medicine. Buckley can also be topic to an indefinite Sexual Harm Prevention Order;
 
Kyle Fox, 26, of the United Kingdom, pleaded responsible to 22 counts together with rape, sexual assault, and sharing indecent pictures, and was sentenced to serve 22 years in jail; and
 
Mohammed Almaker, 26, of Fort Collins, Colorado, was arrested within the Kingdom of Saudi Arabia (KSA), charged with KSA Law involving the endangerment of kids.  He is awaiting judicial proceedings in furtherance of legal prices.

A forfeiture grievance was additionally unsealed alleging that regulation enforcement was in a position to hint funds of bitcoin to the Darknet web site by following the stream of funds on the blockchain and so they search to recuperate these funds and finally return the illicit funds to victims of the crime.

About Richard Kastelein

Founder and writer of trade publication Blockchain News (EST 2015), a associate at ICO providers collective Token.Agency ($750m+ and 90+ ICOs and STOs), director of schooling firm Blockchain Partners (Oracle Partner) – Vancouver native Richard Kastelein is an award-winning writer, innovation government and entrepreneur. He sits on the advisory boards of some two dozen Blockchain startups and has written over 1500 articles on Blockchain expertise and startups at Blockchain News and has additionally revealed pioneering articles on ICOs in Harvard Business Review and Venturebeat. Irish Tech News put him within the prime 10 Token Architects in Europe.

Kastelein has an Ad Honorem – Honorary Ph.D. and is Chair Professor of Blockchain at China’s first Blockchain University in Nanchang on the Jiangxi Ahead Institute of Software and Technology. In 2018 he was invited to and attended University of Oxford’s Saïd Business School for Business Automation four.zero programme.  Over a half a decade expertise judging and rewarding some 1000+ innovation initiatives as an EU knowledgeable for the European Commission’s SME Instrument programme as a startup assessor and as a startup choose for the UK authorities’s Innovate UK division.

Kastelein has spoken (keynotes & panels) on Blockchain expertise in Amsterdam, Antwerp, Barcelona, Beijing, Brussels, Bucharest, Dubai, Eindhoven, Gdansk, Groningen, the Hague, Helsinki, London (5x), Manchester, Minsk, Nairobi, Nanchang, Prague, San Mateo, San Francisco, Santa Clara (2x), Shanghai, Singapore (3x), Tel Aviv, Utrecht, Venice, Visakhapatnam, Zwolle and Zurich.

He is a Canadian (Dutch/Irish/English/Métis) whose writing profession has ranged from the Canadian Native Press (Arctic) to the Caribbean & Europe. He’s written sometimes for Harvard Business Review, Wired, Venturebeat, The Guardian and Virgin.com, and his work and concepts have been translated into Dutch, Greek, Polish, German and French. A journalist by commerce, an entrepreneur and adventurer at coronary heart, Kastelein’s skilled profession has ranged from political publishing to TV expertise, boatbuilding to judging startups, skippering yachts to advertising and extra as he is travelled for practically 30 years as a Canadian expatriate dwelling around the globe. In his 20s, he sailed around the globe on small yachts and wrote a sequence of journey articles referred to as, ‘The Hitchhiker’s Guide to the Seas’ travelling by hitching rides on yachts (1989) in main journey and yachting publications. He at the moment lives in Groningen, Netherlands the place he is elevating three teenage daughters together with his spouse and crusing associate, Wieke Beenen.

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