Cybercrime and identity theft have evolved into a sophisticated global economy. Perpetrators use the anonymity provided by digital currency and the internet to hide themselves, their criminal acts and their gains. This nine-year cybercrime investigation case illustrates one of the few law enforcement successes in fighting these crimes.
In early 2005, I was a junior prosecutor at the New York County District Attorney's Office. In addition to my usual duties prosecuting street crimes, I was assigned to the identity theft unit, which famed DA Robert M. Morgenthau had recently formed. I received a complaint, which alleged that a victim's credit card had been used without authorization at an online retailer to ship merchandise to a Manhattan address.
My fellow investigators and I followed the money trail of the online participants in this theft, and we found ourselves looking at a digital currency exchanger in Manhattan called Western Express International Inc.
By outward appearances, Western Express was acting as a check casher and money transmitter for a Russian-speaking clientele based in Eastern Europe but earning money within the U.S. However, the company wasn't licensed by the state to cash checks or transmit money, so we successfully obtained an indictment against them for these crimes in 2006.
Our analysis of computers and records seized from the company revealed that many of their digital currency exchange customers were elite cybercriminals and identity thieves, and the company knowingly was facilitating their crimes and laundering their illegal profits.
Ultimately, Western Express and some of their customers were then indicted again for a variety of charges, including money laundering (of digital currency) and charges related to trafficking in stolen credit card data and other stolen personally identifiable information (PII).
Let's recount the detailed investigation that led to all these indictments and convictions.
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