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Case studies

Case study (Operation Onymous)

In November 2014, law enforcement and prosecutors in the European Union and the United States launched Operation Onymous, an international operation aimed at taking down online illegal markets and arresting vendors and administrators of such markets. The operation was coordinated by Europol's European Cybercrime Centre (EC3), Eurojust, the FBI, and the United States Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI). The operation culminated in the arrest of 17 individuals and the seizure of Bitcoins amounting to USD 1 million, drugs, gold and silver.

Among the marketplaces brought down was Silk Road 2.0, an online black market used to sell drugs and other illegal items. In 2013, the FBI shut down its predecessor, Silk Road 1.0 and arrested its founder Ross Ulbricht, who was convicted in February 2015 in the United States. Silk Road 2.0 was launched in November 2013 after the shutdown of its previous version. On 5 November 2015, the alleged administrator of Silk Road 2.0, Blake Benthall, was arrested by the FBI in San Francisco. According to the FBI, as of September 2014, Silk Road 2.0 had sales of at least approximately USD 8 million per month and approximately 150,000 active users. As part of the investigation, an undercover agent infiltrated the administration of Silk Road 2.0 and obtained access to restricted information.

Silk Road 2.0 and other online marketplaces shut down as part of this investigation were operated as TOR hidden services. The TOR (i.e. The Onion Router) network is a worldwide network that allows users to establish anonymous communication. A TOR hidden service does not reveal the IP address of the server used. TOR is used for both illicit and licit purposes, with the latter including members of the military as well as activists and journalists evading censorship.

Most transactions on the shuttered marketplaces were carried out in Bitcoins. Bitcoin is a decentralized cryptocurrency, i.e. there is no centralized authority and Bitcoin transactions are processed and validated by a peer-to-peer network. Bitcoin users are anonymous but all their transactions are stored in a public ledger. Information on Bitcoin users can be obtained from exchanges - i.e. institutions converting Bitcoin into other currencies or vice versa - and other points of intersection with the regulated financial system.

Case-related files

 

Significant feature

  • Organization of illicit online trade
 

Discussion questions

  • Given the nature of their criminal conduct, what model of organized crime would best describe the administrators of the Silk Road? Can Ulbricht be considered a leader of an organized criminal group?
  • According to the line of Ulbricht's defence, he was merely involved in the Silk Road website, which he claimed to administer as an economic experiment. Other motivated individuals interested in selling illegal goods and services, however, transformed the website into a massive criminal marketplace. Those individuals are the real offenders. Support or refute this position.
  • Meghan Ralston, a former "harm reduction manager" for the Drug Policy Alliance, was quoted as saying that the Silk Road was "a peaceable alternative to the often deadly violence so commonly associated with the global drug war, and street drug transactions, in particular." Proponents of the Silk Road and similar sites argue that buying illegal narcotics from the safety of your home is better than buying them in person from criminals on the streets. Do you agree or disagree with this position? 

Case study (structure of a drug trafficking organization)

The organized criminal group in question consisted of 21 members, citizens of the Serbia, Bosnia and Herzegovina and Montenegro, operating on the territories of Montenegro, Bosnia and Herzegovina, Serbia and Croatia. Serbian authorities brought criminal charges against five citizens of the Republic of Serbia and one citizen of Montenegro; other members of the organized criminal group were prosecuted by the competent authorities of Bosnia and Herzegovina. Two criminal proceedings were conducted simultaneously and in coordination by authorities of both countries.

The leader of the group, a Serbian citizen, was managing the whole group's business from the territory of the Republic of Serbia, but no drugs were seized in the country. He had direct contacts with his partners and group members in Montenegro who were sending drugs to affiliates in Bosnia and Herzegovina. The latter were distributing and selling drugs in Bosnia and Herzegovina as well as in Croatia. This organized criminal group also had good connections in the local police, as it is demonstrated by the fact that some of the defendants prosecuted in Bosnia and Herzegovina were police officers.

The group had a pyramidal, hierarchical structure with clear roles for every member and adopted a strict, almost military, way of command. The leader of the group communicated with a limited number of members and most members were communicating with their superiors only via mobile phones. This group formed specific cells in order to perform particular illicit activities. In particular, they were involved in trafficking in cocaine, purchasing bombs and explosive devices, as well as stolen goods such as vehicles, mobile phones etc. At the time of the arrest, the group was suspected of organizing a robbery, kidnapping and murder. In February 2009, the police launched operation "Valter," in close cooperation with the Serbian Prosecutor's Office for Organized Crime. From the initial stages, Serbian authorities were in contact with the competent authorities of Bosnia and Herzegovina and exchanged data and information on the activities of the criminal group.        

The prompt and coordinated action of law enforcement agencies from Serbia and Bosnia and Herzegovina prevented a number of serious crimes and brought the members of this criminal group to justice. This group is seen as a one of the criminal groups with the highest level of organization in the Balkan region.

Case-related files

 

Significant feature

  • Organization of cross-border drug trafficking activities
 

Discussion questions

  • What model of organized criminal groups discussed in the Module best fits this case?
  • What are the advantages of this model?
 

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