US Court Seizes Assets of Darknet Kingpin

Fresno’s division of the US District Court for California’s Eastern District closed a civil forfeiture case last week that had been ongoing for the last 14 months. This was initiated to seize the assets of Alexandre Cazes, suspected of operating AlphaBay, a darknet marketplace.

The Story

Cazes committed suicide while incarcerated in a prison in Thailand last year and avoided standing trial for his crimes, which included facilitating as well as selling illegal goods as well as services in the US and other countries on AlphaBay.

It was on July 7, 2017, that Cazes was caught during a dramatic confrontation outside his home in Bangkok. The Royal Thai police was forced to create a dramatic scene so that they could force him into a confrontation so that he would not get a chance to encrypt or wipe out the digital evidence that was needed to implicate him.

The evidence the police were looking for was found on his laptop, administrative accounts that showed he had operated AlphaBay. He was charged with racketeering, identity theft, fraud, trafficking as well as money-laundering.

When Cazes’ net worth was assessed, it was found that he had over $23 million in assets consisting of real estate, high end luxury cars and cryptocurrencies. The cryptos amounted to $8.8 million, split into 1,605.05 BTC, 8,309.27 ETH, 3,691.98 Zcash, an unknown amount in Monero.

Bigger than the Silk Road

AlphaBay was launched in September 2014, and, up to the time that Cazes was caught, it was the busiest marketplace on the darknet. There were more than 400,000 lifetime users and 370,000 aggregate listings. The website was processing more than $800,000 worth of transactions per day when it was finally shut down.

AlphaBay was ten times as big as the Silk Road, another darknet marketplace that operated before it. The Silk Road was a stop-stop-shop for everything illegal – drugs, counterfeit information, pirated software, malicious software, weapons, chemicals and even murder for hire.

Had Cazes not killed himself, he would have been extradited to the US and face conviction the same way that the founder of Silk Road, Ross Ulbricht did. Ulbricht is now serving a double-life sentence without the possibility of parole, in addition to 40 years in a federal prison outside of his home state of Colorado.

Both these marketplaces were situated on the darknet, an underground network of Internet communities that can only be accessed via encrypted programs and protocols that anonymize access such as Tor and I2P. And the currency of choice for the darknet is cryptos, which is one of the reasons why the cryptocurrency industry is still struggling to be accepted in the world of mainstream finance.

The successor to AlphaBay, called Empire Market, was revealed in March this year and is still in operation.