
Bank of the Underworld (2015) - axiomdata316
https://www.theatlantic.com/magazine/archive/2015/05/bank-of-the-underworld/389555/
======
blotter_paper
>The target was a Vietnamese man named Hieu Minh Ngo. Investigators believed
he was a big-time identity thief who sold packages of data known as “fullz,”
each of which typically included a person’s name, date of birth, mother’s
maiden name, Social Security number, and e-mail address and password.
Criminals could buy fullz from Ngo for as little as eight cents and then use
them to open credit cards, take out loans, or file for bogus tax refunds.
[...] He had allowed nearly 1,400 criminals to access a database containing
the personal information of 200 million U.S. citizens—almost two-thirds of the
population.

If two thirds of Americans have had all of that information compromised from
this one incident alone, why do we use it as authentication for _anything?_
Shouldn't the SSN be replaced/assisted by a key pair?

~~~
pjc50
Americans are dead-set against having a working national ID system. There are
even people who are upset about the mere existence of the SSN for weird
religious reasons. The British situation is even worse - proof of right of
residence is required for opening a bank account, working, or renting a home,
but only immigrants are made to have ID cards. Also utility bills are a valid
proof of address for some reason.

No, the real problem is a liability one; loan companies should be held liable
for each instance of fraud where they pursue the wrong person.

~~~
jandrewrogers
Americans not having a national ID system has nothing to do with what
Americans want. It is expressly unconstitutional for the Federal government to
require such a thing, only the individual States have the authority to issue
IDs and the States are required to recognize these documents from other
States. Again, the US is organized more like the EU than a single country.

Consequently, all Federal identification documents are strictly voluntary
(like passports), which means some significant fraction of the population will
never have them.

~~~
GhettoMaestro
Good point.

Perhaps a PKI-based federated system should be deployed, even if adoption were
on a state by state basis. I assume most states would adopt it, given the
benefits we can think of ourselves.

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zipwitch
_> Prosecutors dismissed the idea that many legitimate businesses used Liberty
Reserve. After the takedown, they noted, users were encouraged to contact the
U.S. Attorney’s Office in Manhattan if they wanted their money back. According
to prosecutors, only 35 people did so._

Was that because only 35 users were legitimate, or because the users - even if
completely legitimate - were reluctant to risk potentially destroying their
lives by admitting their identities to federal investigators?

~~~
CamelCaseName
I was not even aware this was possible.

My loss from the LR takedown was ~$600 and this is the first time I ever heard
that any such recourse that was available.

In my personal experience, LR was easier to use and more widely accepted at
the time than competing services. (namely PayPal)

This article focused a lot on the carding scene, which no doubt was heavily
reliant on LR, but to paint all 1MM+ users of LR as carders is simply
incorrect. As the article mentions, it was trivial to open an account (as easy
as signing up for HN really) and many would do so to make a one-off payment.

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parliament32
He ended up being sentenced to 20 years: [https://www.justice.gov/usao-
sdny/pr/liberty-reserve-founder...](https://www.justice.gov/usao-
sdny/pr/liberty-reserve-founder-arthur-budovsky-sentenced-manhattan-federal-
court-20-years)

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thefounder
So long with the right to a lawyer and a fair trial.

>> According to Stapert, the U.S. government requested that he forfeit his
fees for the case—insisting that the money Budovsky had paid him was tainted—a
move that forced him to drop Budovsky as a client. (The Manhattan U.S.
Attorney’s Office denies that the government petitioned Stapert to forfeit the
fees.) Once on U.S. soil, Budovsky was assigned a court-appointed lawyer;

~~~
mpiedrav
Once a case is big enough for improving the reputation of prosecutors and
institutions involved, they will go to any length to make it happen.

Challenging the US justice system in matters of legal (and even human) rights,
more often than not, leads to dead ends.

------
partisan
> First of all, for thouse who [have] big money [stuck] in LR, dont be anxious
> … thinking about the possibility to loose your money. Thats will cause
> unnecessary pain. Give a good kiss your wife/girlfriend or your son if you
> have. Give a time for your mind. Live your life whatever be the future of
> this money … If still thinking that you have no where to run: IF we lost, (I
> said IF, we have nothing concrete yet) we lost a place to KEEP money, not
> the way to MAKE money. Keep that in mind. The show MUST GO on.

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0xdeadb00f
> An agent tried opening an account with the name “Joe Bogus” and an address
> of “123 Fake Main Street” in “Completely Made Up City.” The agent also named
> the account “ToStealEverything” and wrote that it would be used for “shady
> things.” He encountered no problems, and the account was soon functional.

One must assume registration was automated at this point, no? There's no shady
business practice in _this_ specifically.

~~~
CamelCaseName
The issue is that financial systems are regulated and opening an account
usually requires an AML / KYC process that ties you users to a personal ID.

~~~
0xdeadb00f
Ah! That's what I was missing. KYC

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raintrees
As the article states, Western Union is used frequently for transactions with
assets that may have been gained through illegal activity (as judged per
various government measurements/perspective).

And the USD is likely the greatest instrument by volume of the same types of
transactions.

The transaction business will continue, as humans continue to trade for
benefit. The cat and mouse game seems mostly about "authorities" overseeing
and/or obtaining their share.

Again, an opportunity for p2p distributed, anonymous, and encrypted technology
to allow humans to continue to trade that which they value.

Currency/money is based on trust/faith, so that would be the logical focal
point.

Hypothetically, such development work would likely need to be conducted in
jurisdictions that owe no allegiance to those authorities that do not wish for
it to occur. Flavors of Cryptonomicon...

Fascinating.

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hummel
Absynthe/Master Splynter was an undercover agent at those times.

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varshithr
I was wondering, does it make sense for "Underworld" to adopt something
similar to Facebook's Libra?

Seems like a perfect fit and transaction cost would be worth it.

~~~
hummel
They already did, it's called bitcoin

~~~
SuoDuanDao
Monero actually. Bitcoin is traceable.

~~~
0xdeadb00f
Yes. It's usually converted back/forth between those two though, as Bitcoin is
sometimes the only one accepted.

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brookhaven_dude
No John Wick reference? So disappointed...

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Ceezy
>Budovsky insists he didn’t marry Vargas simply to get Costa Rican
citizenship, which would have been illegal. Theirs was a personal
relationship, he told me, without elaboration.

Lol!

I m not really how they gross 200 M USD in transactions at 1% and he is found
with 2.5 M USD in his debit card.

