Dark Web Vendor Cases: How Agents Identify Sellers.

If you are unfamiliar with how the dark web functions, you may wonder what makes anonymity possible, and why, ultimately, that anonymity does not always protect federal crimes (or alleged crimes). The primary technology that facilitates anonymity on the dark web is known as “The Onion Router,” or “Tor” for short. Tor is a free and open-source software program that creates an encrypted network layer, allowing participants to communicate without disclosing their identity.

Tor works by masking users’ apparent IP addresses and routing communications through a series of relays known as nodes. This makes it far more difficult for investigators to identify users on the dark web, but it does not make identification impossible. Federal agents do not rely solely on Tor-related identification and IP address tracing. Instead, they look for other clues and then corroborate a suspect’s identity.

A Tor-related IP address is merely one piece of evidence. Investigators can use cryptocurrency tracking software to examine blockchain transactions, and they can analyze metadata, chat logs, marketplace data, and other digital evidence obtained from seized computers and servers. They can also use undercover agents, and they can utilize forensic analysis tools to challenge online anonymity.

Undercover agents often pose as either buyers or sellers within online marketplaces. Once in place, these agents can collect valuable information about vendors and other buyers that allows them to build a comprehensive case that has little to do with tracking IP addresses. Along with tracking “digital breadcrumbs,” investigators may also execute package operations to target sellers suspected of using the dark web to ship controlled substances or other illicit goods to buyers’ homes.

In many dark web cases, identification occurs through digital forensics. Digital forensics is the process of examining a computer, phone, or other electronic device in a way that is reliable for legal proceedings. Once federal agents obtain a device, they can search for saved passwords and usernames, encrypted files, chat logs, and other information that identifies the user as the owner or administrator of a dark web marketplace.

Is Using the Dark Web Illegal?

The dark web itself is not inherently illegal. However, due to the ease with which individuals can hide their digital footprints, it is frequently the site of illegal acts and transactions. Although users and vendors should not assume that the dark web provides absolute anonymity, they also should not assume that the mere act of accessing the network constitutes a crime.

What Turns Marketplace and Cryptocurrency Records into Evidence Against a Seller?

Unlike traditional e-commerce platforms, dark-web marketplaces rely on the exchange of digital currencies rather than credit cards, debit cards, or physical currency. This reliance on cryptocurrency, however, makes it possible for federal agents to construct a digital trail of financial activity by analyzing transactions on the blockchain. While certain cryptocurrencies are designed for anonymity, the blockchain is essentially a permanent public ledger of all transactions. This means federal agents can trace the movement of digital coins from the moment a buyer makes a purchase, and they can follow the flow of money back through any wallet transfers until they discover the end-point.

Unfortunately for vendors, this is true regardless of the currency they use. While Bitcoin transactions are particularly easy to trace, this is true for transactions that involve shell companies, cryptocurrency mixers, and other forms of anonymization as well. In most cases, federal agents can use the digital footprint of a cryptocurrency transaction to trace a seller’s financial movements, and they can combine these financial movements with transaction patterns that indicate a suspect sold a controlled substance or committed fraud using an anonymous marketplace.

What Digital Evidence Supports Federal Dark-Web Prosecutions?

Federal prosecutors will pursue indictments and convictions in dark-web vendor cases based on the available digital evidence. When federal agents have the ability to search the computers, servers, and other electronic devices of dark-web vendors and marketplaces, the digital evidence they obtain in these cases can be extremely compelling. Digital evidence can range from blockchain records and cryptocurrency transactions to marketplace data, metadata, chat logs, GPS coordinates, photographs, email records, and encrypted password-protected files.

How Do Prosecutors Use Digital Evidence to Prosecute Sellers?

Because cryptocurrency tracking, blockchain analysis, and digital forensics are complex tasks that require specialized tools and skills, federal prosecutors typically rely on expert witnesses to analyze digital evidence in dark-web vendor cases. These experts will testify at trial to help substantiate the government’s allegations based on the digital evidence gathered, and they can be crucial witnesses that can either help secure a conviction or a defense in federal criminal cases. If you are facing federal charges based on the use of the dark web, our attorneys and consultants will work with you to identify the potential impact of any digital evidence in order to formulate an effective defense strategy.

If federal agents are at your door, the firm's advice is the same as every defense lawyer's: say you want your lawyer, then stop talking.

When Can a Controlled Delivery Connect a Dark-Web Order to a Recipient?

In criminal cases involving the mailing of illicit drugs and other contrabands via the dark web, the last mile of delivery is often when digital anonymity meets physical reality. In many of these cases, the transactions are made with drug vendors and manufacturers from other countries, and they are mailed through the United States Postal Service. The USPS is, in fact, the primary means of mailing illicit shipments through the United States, and in many cases, this can lead to interception by the USPS Postal Inspection Service.

How Does a Controlled Delivery Work in Federal Criminal Investigations?

A controlled delivery is a technique utilized by federal agents that can lead to the identification and arrest of individuals suspected of purchasing and receiving illicit substances or other contrabands through the dark web. After intercepting a package that appears to be illicit, investigators typically replace its contents with lookalikes that are used by undercover agents during the delivery process. An undercover agent typically poses as a delivery person or mail carrier that delivers the suspect package to the destination.

How Can Recipients of Dark-Web Deliveries Be Arrested in Controlled-Delivery Operations?

A controlled delivery is essentially a type of sting operation where investigators set the stage for the subject to be caught in the act. While this often happens upon delivery of a package to the subject’s home or office, a recipient who tries to hide their identity by utilizing a pseudonymous mailbox or other dummy-drop address can also be intercepted. Once the subject takes delivery or collects the package from a designated location, they are promptly arrested. Often, the investigation that leads to the controlled delivery may uncover other forms of evidence, such as communications or cryptocurrency transactions, that can lead to the identification of the sender as well. If you are being investigated for ordering controlled substances online, contact the defense attorneys at Spodek Law Group to discuss next steps as soon as possible.

Why are Dark-Web Seller Cases Often Investigated and Prosecuted Federally?

Among other statutes, federal prosecutors are most likely to pursue charges under the Computer Fraud and Abuse Act (CFAA) in cybercrime cases. The CFAA is a broad statute that criminalizes unlawful access to a computer, and it has long served as a primary tool for prosecuting cyber crimes that don’t involve controlled substances. In the context of dark-web vendor cases, digital access to servers can involve crossing national borders (since a server may be hosted in a foreign country), and the fact that the investigation needs to be conducted on an international scale adds another layer of federal jurisdiction to these cases.

While various other federal law enforcement agencies are involved in these cases, the FBI is typically the agency to lead more complex investigations. In many cases, the FBI will also provide forensic assistance during subsequent prosecutions. In contrast, federal agents who lead investigations into the sale and shipment of controlled substances may include those from the IRS, Homeland Security Investigations (HSI), and the Drug Enforcement Administration (DEA).

Because dark-web investigations routinely cross national borders, they often require substantial resources and legal knowledge, including familiarity with international treaties, cooperation agreements, and Mutual Legal Assistance Treaties (MLATs) that are negotiated on the federal government’s behalf. This makes it much more practical for federal law enforcement agencies, rather than local or state law enforcement agencies, to lead these investigations, which requires a high degree of inter-agency cooperation.

Digital evidence is a cornerstone of dark-web investigations, and the digital evidence that federal agents obtain can help support federal indictments against dark-web sellers. Because online-market investigations are typically led by federal agents, they also typically result in federal charges. Federal prosecutors also have the resources and expertise required to investigate digital footprints and prosecute dark-web cases. Of course, while you can never assume that you are safe from federal prosecution, you can be confident that your federal prosecution (if any) will involve a lot of work on the government’s part. When you hire Spodek Law Group, our senior defense attorneys and consultants can use this complexity to help build your defense.

Contact a Federal Criminal Defense Attorney

Nothing here is legal advice, and the details of your case matter. Todd Spodek and Spodek Law Group take federal criminal and white collar cases nationwide, from offices in New York, Brooklyn, Queens and Los Angeles. You can reach the firm at 888 348 8028.