4 ms·

You can't cherry pick that out of context, criminal indictments often cite things that can be ordinary. Buying duct tape isn't a crime, but it can be evidence o

by jshen 3y ago

You can't cherry pick that out of context, criminal indictments often cite things that can be ordinary. Buying duct tape isn't a crime, but it can be evidence of a kidnapping. As far as I can tell these people created a business to profit off of money laundering, and they were helping teach people how to hide their identity.

holmesworcester 3y ago
Yes. We agree completely on the facts here. These people built a business to profit off the provision of online privacy, and as part of they were helping teach people how to preserve their online privacy. Some people used their tool for money laundering, just as some people have surely used encrypted messaging and VPNs for theft, terrorism, child abuse, and other crimes. The point is that online privacy always has significant legitimate, non-criminal use cases, and developers can have legitimate, non-criminal (noble, even) reasons for building for those use cases. And the larger point is that, if we want to have tools that give us any meaningful online privacy, we must stand up for the developers that build such tools when they are (inevitably, perennially) accused of aiding criminals and terrorists.
- JohnFen 3y ago
  The government is going to make the case not that a tool was made that could be used for money laundering, but that a tool was made to intentionally allow for money laundering. The former is not illegal, the latter is. But regardless of intentions, not following KYC/AML rules is illegal.
  - mschuster91 3y ago
    > But regardless of intentions, not following KYC/AML rules is illegal. KYC/AML rules are of questionable legitimacy themselves, IMHO. With less and less of society allowing to pay in anonymous currency (i.e. cold hard cash), either because it's dropped for "security" (i.e. shop owners don't want to pay for security to make sure the cash ain't stolen) or because of legal requirements (see e.g. Italy limiting cash transactions to 5.000€ in value, or Germany requiring a notification if you pay more than 10.000€ in value for a car), and many people moving to card payments due to convenience, there will be no way to escape the dragnet of governmental and private surveillance as all bank accounts are identifiable per KYC/AML regulations and virtually all banks report all account holders to Equifax and the other credit bureaus so to find out where a person banks is only a subpoena or a hack away. Oh, and completely forget about hiding legal but still sensitive payments: sex work of all kinds, political engagement, everything becomes yet another line in a trove of data lakes. And that doesn't even touch the subject of card processing fees. Mastercard and Visa are rent-seekers of the worst kind, and no one seems to be willing to break them up or cap their fees, with PayPal close behind. Instead, everyone looks away when they cave to Evangelical pressure campaigns and drop sex workers left and right. KYC/AML regulations deserve to be torn apart, and the people deserve privacy in their lives. Or, alternatively, we should force elected officials to open up their bank accounts to the public. If we can't have privacy, they certainly don't deserve it either.
    - JohnFen 3y ago
      You're making an argument about what the law should be. In many ways, I'm very sympathetic to those arguments. But that's not what the law is, and law enforcement agencies as well as the court system only deal with what the law actually is. You can (and should!) agitate and work towards changing the law to be more in line with what you think is right. That's the sort of change that is entirely possible in our system. But until then, the law is what the law is.
- ryoshu 3y ago
  These are federal conspiracy counts. Overt acts don't need to be crimes, they just need to be proof of the furtherance of a criminal conspiracy. Making a crowbar isn't illegal. Buying a crowbar isn't illegal. Emailing your buddy and talking about how you're going to bust up a person and their shop because they aren't paying you protection money, then making or buying the crowbars? That could be evidence of an overt act in furtherance of a criminal conspiracy.
  - Terr_ 3y ago
    That example reminds me of some follow-on commentary: > And the only thing I would add is a few other scenarios. The third scenario: A person says to themselves "I'm going to go out and buy a crowbar to [...]" and then I go out and buy a crowbar. Still not a crime because there's no conspiracy, i.e. an agreement with another person. > [...] And then there's the fourth scenario: A person says to themselves "I'm going to go out and buy a crowbar to [...]", buys the crowbar, and and then actually starts hitting people [...] Now there's still no conspiracy, but you've taken a substantial step towards the crime and and likely completed the crime and you're guilty of the initial crime. [0] https://www.youtube.com/watch?v=SbIhNmoZLJQ&t=3m00s https://www.youtube.com/watch?v=SbIhNmoZLJQ&t=3m00s
- DannyBee 3y ago
  The indictment says they knew they were laundering proceeds of a specific hack, by a specific group. See page 24 Not "they created a tool and it got misused" but instead "these specific criminally sanctioned folks are using our tool to launder 600 million dollars, and we know, should we do something about that?" Their messages back up that they know it was being used in a specific instance, by criminals, to launder money, and they did nothing. Sorry, no sympathy. I'm with you that we need to ensure tools are available, and i'm even okay arguing about KYC/etc. But when you have specific, actual, knowledge that a criminal actor is using your tool to launder money, and you do nothing, sorry, that's just aiding and abetting.
  - poma 3y ago
    The smart contracts are immutable nobody can change them including the devs. When prosecution says "did nothing" they should probably mention that it was not technically possible to do anything productive.
    - DannyBee 3y ago
      You seem to think this matters, but the charges are conspiracy, so it in fact, does not. Their part of the conspiracy was already complete, whether they could do anything or not. If you create parts for a bomb and hand them to someone else, knowing they are likely to use it as a bomb, and they in fact do, you are as guilty of conspiracy as the actual bomber. Your crime was complete when you gave them the parts, which is an overt act (some act in furtherance of the conspiracy). (Unlike the typical gun analogies that get brought up in response, i'm choosing something that does not have a legitimate purpose and is in fact illegal to create as-is) If you create a thing in the US that is required to comply with KYC/AML and don't, and someone users it to launder, and you know they use it to launder, you are still guilty even if you couldn't stop them from using it. Again, your crime is complete at the point you complete an overt act . You have to withdraw from the conspiracy before then. Here, the government is charging them for the website, mainly, not the smart contracts
  - noman-land 3y ago
    What could they have done?

by jshen 3y ago

holmesworcester 3y ago

Yes. We agree completely on the facts here. These people built a business to profit off the provision of online privacy, and as part of they were helping teach people how to preserve their online privacy. Some people used their tool for money laundering, just as some people have surely used encrypted messaging and VPNs for theft, terrorism, child abuse, and other crimes. The point is that online privacy always has significant legitimate, non-criminal use cases, and developers can have legitimate, non-criminal (noble, even) reasons for building for those use cases. And the larger point is that, if we want to have tools that give us any meaningful online privacy, we must stand up for the developers that build such tools when they are (inevitably, perennially) accused of aiding criminals and terrorists.

JohnFen 3y ago
The government is going to make the case not that a tool was made that could be used for money laundering, but that a tool was made to intentionally allow for money laundering. The former is not illegal, the latter is. But regardless of intentions, not following KYC/AML rules is illegal.
- mschuster91 3y ago
  > But regardless of intentions, not following KYC/AML rules is illegal. KYC/AML rules are of questionable legitimacy themselves, IMHO. With less and less of society allowing to pay in anonymous currency (i.e. cold hard cash), either because it's dropped for "security" (i.e. shop owners don't want to pay for security to make sure the cash ain't stolen) or because of legal requirements (see e.g. Italy limiting cash transactions to 5.000€ in value, or Germany requiring a notification if you pay more than 10.000€ in value for a car), and many people moving to card payments due to convenience, there will be no way to escape the dragnet of governmental and private surveillance as all bank accounts are identifiable per KYC/AML regulations and virtually all banks report all account holders to Equifax and the other credit bureaus so to find out where a person banks is only a subpoena or a hack away. Oh, and completely forget about hiding legal but still sensitive payments: sex work of all kinds, political engagement, everything becomes yet another line in a trove of data lakes. And that doesn't even touch the subject of card processing fees. Mastercard and Visa are rent-seekers of the worst kind, and no one seems to be willing to break them up or cap their fees, with PayPal close behind. Instead, everyone looks away when they cave to Evangelical pressure campaigns and drop sex workers left and right. KYC/AML regulations deserve to be torn apart, and the people deserve privacy in their lives. Or, alternatively, we should force elected officials to open up their bank accounts to the public. If we can't have privacy, they certainly don't deserve it either.
  - JohnFen 3y ago
    You're making an argument about what the law should be. In many ways, I'm very sympathetic to those arguments. But that's not what the law is, and law enforcement agencies as well as the court system only deal with what the law actually is. You can (and should!) agitate and work towards changing the law to be more in line with what you think is right. That's the sort of change that is entirely possible in our system. But until then, the law is what the law is.
ryoshu 3y ago
These are federal conspiracy counts. Overt acts don't need to be crimes, they just need to be proof of the furtherance of a criminal conspiracy. Making a crowbar isn't illegal. Buying a crowbar isn't illegal. Emailing your buddy and talking about how you're going to bust up a person and their shop because they aren't paying you protection money, then making or buying the crowbars? That could be evidence of an overt act in furtherance of a criminal conspiracy.
- Terr_ 3y ago
  That example reminds me of some follow-on commentary: > And the only thing I would add is a few other scenarios. The third scenario: A person says to themselves "I'm going to go out and buy a crowbar to [...]" and then I go out and buy a crowbar. Still not a crime because there's no conspiracy, i.e. an agreement with another person. > [...] And then there's the fourth scenario: A person says to themselves "I'm going to go out and buy a crowbar to [...]", buys the crowbar, and and then actually starts hitting people [...] Now there's still no conspiracy, but you've taken a substantial step towards the crime and and likely completed the crime and you're guilty of the initial crime. [0] https://www.youtube.com/watch?v=SbIhNmoZLJQ&t=3m00s https://www.youtube.com/watch?v=SbIhNmoZLJQ&t=3m00s
DannyBee 3y ago
The indictment says they knew they were laundering proceeds of a specific hack, by a specific group. See page 24 Not "they created a tool and it got misused" but instead "these specific criminally sanctioned folks are using our tool to launder 600 million dollars, and we know, should we do something about that?" Their messages back up that they know it was being used in a specific instance, by criminals, to launder money, and they did nothing. Sorry, no sympathy. I'm with you that we need to ensure tools are available, and i'm even okay arguing about KYC/etc. But when you have specific, actual, knowledge that a criminal actor is using your tool to launder money, and you do nothing, sorry, that's just aiding and abetting.
- poma 3y ago
  The smart contracts are immutable nobody can change them including the devs. When prosecution says "did nothing" they should probably mention that it was not technically possible to do anything productive.
  - DannyBee 3y ago
    You seem to think this matters, but the charges are conspiracy, so it in fact, does not. Their part of the conspiracy was already complete, whether they could do anything or not. If you create parts for a bomb and hand them to someone else, knowing they are likely to use it as a bomb, and they in fact do, you are as guilty of conspiracy as the actual bomber. Your crime was complete when you gave them the parts, which is an overt act (some act in furtherance of the conspiracy). (Unlike the typical gun analogies that get brought up in response, i'm choosing something that does not have a legitimate purpose and is in fact illegal to create as-is) If you create a thing in the US that is required to comply with KYC/AML and don't, and someone users it to launder, and you know they use it to launder, you are still guilty even if you couldn't stop them from using it. Again, your crime is complete at the point you complete an overt act . You have to withdraw from the conspiracy before then. Here, the government is charging them for the website, mainly, not the smart contracts
- noman-land 3y ago
  What could they have done?