A man in Brooklyn NYC was charged Wednesday with selling heroin and cocaine on the dark web in exchange for bitcoin and running a door-to-door drug delivery service in New York, federal authorities said.
The man Edison Hernandez, 46, allegedly sold drugs under the pseudonyms “dragoncove” and “Nino” on darkweb markets including Silk Road, AlphaBay, Dream Market and Wall Street Market for about six years starting in 2013, prosecutors from the Eastern District of NYC said.
The accused vendor became a highly rated vendor on the darkweb, which allowed customers to grade dealers on factors such as quality of the product, reliability and volume.
He was able to evade law enforcement for years by using pseudonyms and accepting payment in bitcoin.
The darkweb vendor then worked with two other suspected vendors, 42-year-old Michael Caruso and Raymer Ynoa, 32, to sell cocaine, methamphetamine, ketamine and MDMA in a door-to-door delivery service in Manhattan and Brooklyn for three years starting in 2019.
The suspects advertised their service as “Nino & Viktor’s Pastry Shoppe” and they allowed customers to order drugs over encrypted messaging apps. A delivery person would then allegedly hand off the drugs after the deal was set up.
They all face a maximum of 40 years in prison if convicted.
A fourth co-conspirator, Irvin Hernandez, was charged in a separate criminal complaint with working for the delivery service.
The suspects were expected to appear in Brooklyn NYC federal court Wednesday afternoon. Attorney information for them was not immediately available.
NYC Attorney
“Hiding behind the dark web, encryption services, or bitcoin will not stop this Office from rooting out those who flood our communities with illegal and hazardous narcotics,” Breon Peace, the US attorney for the Eastern District of NYC.
Another member of EastSideHigh has pleaded guilty to his role in a “highly sophisticated” darkweb drug trafficking operation.
Allante Pires, 25, pleaded guilty to conspiracy to manufacture, distribute and possession with intent to distribute MDMA, Ketamine, and Alprazolam. Pires and his co-conspirators Binh Thanh Le and Steven McCall were accused of selling drugs on the darkweb as the “EastSideHigh” vendor.
EastSideHigh Investigation
The details of court documents show an extensive investigation into EastSideHigh. As a part of the case, federal law enforcement officers intercepted drug packages, conducted persistent electronic and physical surveillance, communicated with EastSideHigh in an undercover capacity, and purchased drugs from the vendor on different darkweb marketplaces.
The Federal investigators, including postal inspectors with the United States Postal Inspection Service (USPIS), launched started investigating EastSideHigh in June 2018. The law enforcement officers investigating the darkweb vendor conducted multiple controlled purchases from EastSideHigh on Dream Market. These purchases helped investigators identify the defendants.
After they identified the defendants, investigators conducted physical surveillance and placed GPS tracking devices on their vehicles. Customs intercepted packages of pill binders that suppliers had shipped to addresses frequented by the trio. Le had registered a business with the name “BL Productions” (Binh Le) using the address of an office space in Stoughton, Massachusetts. State police recovered trash at the locations frequented by the defendants and found drug residue on packages, materials used in drug manufacturing, and empty mailers that someone had shipped to the Stoughton address. Some of the open mailers listed a fake name as the recipient. Customs had seized packages of LSD, MDMA, and Xanax pills that international suppliers had shipped to the Stoughton address with the same fake name as those packages recovered from the trash.
In February 2019, an undercover Homeland Security Investigations (HSI) agent notified Postal Inspector Gina Gentiluomo that EastSideHigh was trying to exchange Bitcoin for cash. The HSI agent communicated with EastSideHigh through a secure messaging application about the exchange. Inspector Gentiluomo then contacted the vendor, posing as the money launderer.
Hotel Meeting
In March 2019, Inspector Gentiluomo and another postal inspector (UC) met with Le at a hotel. The parties agreed to exchange $200,000 in Bitcoin in a wired hotel room. After Le had sent the Bitcoin to the address provided by the feds, the second postal inspector pretended to be having problems with his cellphone. He asked Le to open the wallet application on his phone and verify that the transaction had been completed. Le handed his unlocked phone to the postal inspector. After the postal inspector had possession of Le’s phone, postal inspectors and state police entered the room and detained Le.
After being advised of his rights per Miranda, Le voluntarily provided law enforcement officers with his password.
After detaining Le, other officers approached Pires’ Mercedes, which was still in the hotel’s parking lot. They detained Pires and asked him about the keys on his key ring. Pires identified one as the key to the office space in Stoughton. Other law enforcement officers executed a search warrant at the office space where they encountered McCall wearing a respirator.
The police searched the office space and found found 11 pounds of ketamine, 5,000 grams of ecstasy pills, packaging materials, two digital scales, two heat-sealing devices, a pill press, and $114,700 in cash. They also found a laptop with the EastSideHigh profile on Wallstreet Market open on the screen. The police also seized 18 kilograms of MDMA and more than $200,000 in Bitcoin by the end of the investigation.
Le pleaded guilty to conspiracy to manufacture, distribute and possess with intent to distribute MDMA, Ketamine, and Alprazolam. On March 10, 2022, a judge sentenced Le to eight years in prison and three years of supervised release. The judge ordered Le to forfeit more than 59 Bitcoin, $114,680 in cash, the proceeds from a 2018 BMW M3 sale, a pill press, and a currency counter.
McCall has a plea hearing scheduled for June 28, 2022.
In the criminal complaint, Inspector Gentiluomo points to the existence of a “music” video on YouTube titled “MTS – ALL FOR THE GANG.” The video, uploaded by MTS Entertainment on January 3, 2019, contains “various individuals of interest to law enforcement.” Gentiluomo learned about the video on January 11, 2019. Part of the video was filmed at the office space in Stoughton. A pill press is visible in the background of the scenes filmed in the office space. The postal inspector wrote that the bag beside the pill press contained powder.
Law enforcement in Russia has blocked major sites on the dark web, including a carding market leader. The platforms have been seized amid ongoing investigations into hacking groups, with Russian authorities ramping up efforts to dismantle the cybercrime rings and detain their members.
Interior Ministry of Russia Hits Stolen Credit Cards Market
The Ministry of Internal Affairs of the Russian Federation (MVD) has brought down four prominent websites operating on the dark web, blockchain forensics firm Elliptic has revealed. The sites have been blocked by Directorate “K”, MVD’s unit combatting computer-related crime.
The seized platforms are the Sky-Fraud forum, Trump’s Dumps, UAS Store, and Ferum Shop, which became the leading market for stolen credit cards after the largest marketplace in the niche, Unicc, was taken offline in January, the report details.
According to Elliptic’s estimate, the sites have collectively made more than $263 million in crypto sales denominated in bitcoin (BTC), ether (ETH), and litecoin (LTC) before they were shut down. Ferum accounts for the bulk of that amount with $256 million in bitcoin generated, or 17% of the carding market.
Trump’s Dumps, another website distributing compromised card data, has allegedly made around $4.1 million since its launch in 2017. Both sites were advertised on the on Sky-Fraud forum, where carding techniques and money laundering tips were among the main topics. Directorate “K” has apparently left a message in its source code, reading: “Which one of you is next?”
[#Russia] SKY-FRAUD & FERUM, famous Russian #carding forums closed by Russian authorities.
The fourth blocked website, UAS Store, was a platform offering stolen remote desktop protocol credentials that cybercriminals use to gain access to victims’ accounts from other devices. These breaches have increased during the Covid-19 pandemic as more employees are now working from home. Since late 2017, UAS Store has made around $3 million in cryptocurrency.
Elliptic notes that the latest seizures have been executed after the previous top carding marketplace, Unicc, and its affiliate proxy market Luxsocks, became inaccessible in mid-January. The seizures also came after the subsequent arrest of Unicc’s suspected administrator by the Russian Federal Security Service (FSB). Researchers claim the crypto proceeds of the two platforms reached $372 million.
Meanwhile, the MVD has sought through a Moscow court the arrest of six unidentified hackers accused of “illegal circulation of means of payment.” Whether the group is linked to the closed-down dark web sites is not clear yet. Last month, FSB and MVD busted the notorious Revil ransomware group on a U.S. request, detaining 14 of its suspected members.
Do you think Russia will continue to crack down on dark web platforms and hacking groups? Tell us in the comments section below.
Login
