New York
Authorities say the site trafficked drugs such as heroin and cocaine, fake and stolen IDs, computer hacking tools, firearms and counterfeit goods. The site also facilitated services such as money laundering.
AlphaBay went so far as to hire scam watchers to monitor and quash scams on the site. It had a public relations manager responsible for outreach to users and the broader illicit-trade community. The site also employed moderators to resolve disputes and refund payments.
AlphaBay hid its tracks with Tor, a network of thousands of computers run by volunteers. With Tor, traffic gets relayed through several computers. At each stop, identifying information is stripped, so that no single computer knows the full chain.
Tor has a number of legitimate uses. Human rights advocates, for instance, can use it to communicate inside authoritarian countries. But Tor is also popular for trading goods that eBay and other legitimate marketplaces won’t touch.
To further promote secrecy, AlphaBay accepted only digital currencies such as bitcoin and monero. In doing so, participants skirted reporting requirement that come when moving $10,000 or more in a single transaction. While bitcoin can be traced when converted back to regular currencies, AlphaBay offered “mixing and tumbling services” to shuffle bitcoin through several accounts before the conversion.
AlphaBay took a 2 percent to 4 percent commission, and that added up. The suspect behind the site, Alexandre Cazes, had amassed a fortune of $23 million.
