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US, European Authorities Take Down 2 'Darknet' Marketplaces


Deputy Attorney General Rod Rosenstein, center, accompanied by DEA Deputy Administrator Robert Patterson, left, Attorney General Jeff Sessions, second from right, and FBI Acting Director Andrew McCabe, right, speaks at a news conference to announce an international cybercrime enforcement action at the Department of Justice, July 20, 2017, in Washington.

U.S. and European law enforcement officials say they've shut down two of the most popular marketplaces operating on the so-called darknet that sold drugs, stolen credit cards, weapons and other illicit goods.

The closure of AlphaBay by U.S. authorities this month and of Hansa Market by Dutch police on Thursday followed coordinated law enforcement action that spanned three continents.

Launched in 2014, AlphaBay dominated the growing darknet business in drugs after authorities shuttered another illegal drug bazaar known as Silk Road in 2013.

Attorney General Jeff Sessions called AlphaBay's closure "the largest darknet marketplace takedown in history."

"This is likely one of the most important criminal cases of the year," Sessions told a news conference in Washington. "I believe that because of this operation, the American people are safer — safer from the threat of identity fraud and malware, and safer from deadly drugs."

Darknet behemoth

Until it was taken down, AlphaBay was the largest of an estimated 30 to 50 illegal marketplaces that operated on the dark Web, generating twice as much revenue as Silk Road, said Nicolas Christin, a computer science professor and dark Web expert at Carnegie Mellon University in Pittsburgh.

Europol Director Rob Wainwright said AlphaBay and Hansa Market were two of the top three criminal marketplaces on the dark Web.

AlphaBay's and Hansa's closures send "a clear message that the darknet is not a safe area for criminals," Wainwright said.

Investigations were led by the FBI, the U.S. Drug Enforcement Agency and the Dutch National Police. Police in other countries, including the United Kingdom, France and Lithuania, also contributed.

Law enforcement officials said AlphaBay was created by Alexandre Cazes, a 26-year-old Canadian website designer who lived in Thailand and who singlehandedly controlled all aspects of the site's operations through June 2017.

AlphaBay was created by Alexandre Cazes, who lived in Thailand. He singlehandedly controlled all aspects of the site's operations through June 2017. The site went offline on July 4.
AlphaBay was created by Alexandre Cazes, who lived in Thailand. He singlehandedly controlled all aspects of the site's operations through June 2017. The site went offline on July 4.

The site went offline on July 4, the day before Thai authorities arrested Cazes and prepared to extradite him to the U.S. to face charges. Cazes hanged himself in a jail cell on July 15.

At its peak, AlphaBay boasted more than 200,000 customers and 40,000 vendors.

Around the time of its takedown, there were over 250,000 listings for illegal drugs and toxic chemicals on the site, and over 100,000 listings for stolen and fraudulent identification documents and access devices, counterfeit goods, malware and other computer hacking tools, firearms and fraudulent services, the Department of Justice said.

Sessions noted that the lion's share of AlphaBay's business involved illicit drugs, "pouring fuel on the fire of the national drug epidemic."

Sessions said several Americans were killed by drugs sold on AlphaBay, including an 18-year-old victim who overdosed on a powerful synthetic opioid she'd purchased on the online marketplace and had delivered to her house by mail.

After AlphaBay was shuttered, many of its users migrated to Hansa Market. But Dutch police had already been in control of the site since June 20.
After AlphaBay was shuttered, many of its users migrated to Hansa Market. But Dutch police had already been in control of the site since June 20.

Not likely a deterrence

After the site was shuttered, many of its users, known as "AlphaBay refugees," migrated to Hansa Market. But Dutch police had already been in control of the site since June 20, Christin said.

"This is the first time that law enforcement actually works undercover for a month as the operator of a marketplace," Christin said.

While a significant law enforcement achievement, AlphaBay's closure is unlikely to deter others from doing business on the dark Web, said Greg Virgin, CEO of cybersecurity firm RedJack.

"Over the past few years, what we've seen happen is that when one marketplace goes down, there are others waiting to take its place," Virgin said.

He estimated that the marketplaces generate tens of millions of dollars a month in revenue. Research has shown that most dark Web customers come from the U.S., Western Europe, Asia and Australia, he said.

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