Alphabay Marketplace Prosecutions
đ What Was AlphaBay?
AlphaBay was a massive darknet marketplace launched in 2014, accessible via Tor, and considered the largest of its kind before it was shut down in July 2017.
It hosted illegal goods/services like:
Narcotics
Weapons
Malware & hacking tools
Fake IDs & documents
Stolen data (e.g., credit cards)
At its peak, it had over 400,000 users and facilitated billions in transactions, mainly in Bitcoin and Monero.
After its takedown, law enforcement tracked and prosecuted founders, administrators, and top vendors.
âď¸ Legal Framework for Prosecutions
Prosecutions related to AlphaBay involve charges under:
21 U.S.C. § 846 â Drug trafficking conspiracy
18 U.S.C. § 1956 â Money laundering
18 U.S.C. § 371 â General conspiracy
18 U.S.C. § 1030 â Computer Fraud and Abuse Act (for hacking tools/malware)
18 U.S.C. § 2320 â Trafficking in counterfeit goods
18 U.S.C. § 1960 â Operating an unlicensed money transmitting business
đ§ââď¸ Key AlphaBay-Related Prosecution Cases (Detailed)
1. United States v. Alexandre Cazes (2017)
Facts:
Cazes, a Canadian national, was the founder and administrator of AlphaBay (under the alias âAlpha02â).
He was arrested in Thailand in July 2017, where authorities seized his assets and computers containing key evidence (server logs, passwords).
He died by suicide in Thai custody shortly after arrest.
Charges (filed before his death):
Conspiracy to engage in racketeering
Narcotics conspiracy
Identity theft
Access device fraud
Money laundering
Outcome:
Though Cazes died before trial, his arrest led to:
Seizure of AlphaBay infrastructure
Dozens of vendor prosecutions
Asset forfeiture proceedings for millions in cryptocurrency
Significance:
Cazesâ arrest ended AlphaBay and revealed how law enforcement could pierce the anonymity of darknet operators.
2. United States v. Gal Vallerius (aka âOxyMonsterâ) (2017â2018)
Facts:
Vallerius, a French national, was a top vendor and moderator on AlphaBay.
He was arrested in the U.S. while entering the country for a beard competition.
Authorities found his laptop unlocked, revealing the âOxyMonsterâ login and drug transaction logs.
Charges:
Conspiracy to distribute controlled substances
Conspiracy to launder money
Drug trafficking across borders
Outcome:
Pled guilty in 2018
Sentenced to 20 years in federal prison
Significance:
Demonstrated how careless operational security (like traveling with unlocked devices) led to arrest.
3. United States v. Bryan Connor Herrell (aka âPenissmithâ) (2020)
Facts:
Herrell served as an AlphaBay moderator, resolving disputes between users and vendors.
He had access to user communications, transaction details, and vendor performance.
Charges:
Conspiracy to engage in a racketeer influenced corrupt organization (RICO) under 18 U.S.C. § 1962(d)
Outcome:
Pled guilty
Sentenced to 11 years in federal prison
Significance:
First case where a marketplace moderator (not a vendor or admin) was held criminally liable under RICO.
4. United States v. Ronald Wheeler (aka âTrappy88â) (2019)
Facts:
Wheeler was a top-level AlphaBay drug vendor, specializing in fentanyl and counterfeit pills.
Used encrypted messaging and Bitcoin for transactions.
Charges:
Drug distribution
Possession with intent to distribute
Conspiracy
Money laundering
Outcome:
Convicted and sentenced to 25 years in federal prison.
Significance:
Highlighted the deadly impact of fentanyl sales through darknet platforms and the courtâs harsh stance on such vendors.
5. United States v. Michael Weigand (aka âShawn Shillingerâ) (2020)
Facts:
Weigand helped Cazes conceal his identity and aided in running AlphaBay servers and moving money.
Provided false information to law enforcement during investigation.
Charges:
Obstruction of justice
Making false statements
Conspiracy to commit access device fraud
Outcome:
Pled guilty
Sentenced to 8 years in prison
Significance:
Showed that even technical or logistical support for darknet markets can result in serious federal charges.
6. United States v. Aamodt (2021)
Facts:
Aamodt was a U.S.-based vendor selling counterfeit prescription medications including OxyContin and Xanax.
Operated under multiple usernames and routed payments through cryptocurrency mixers.
Charges:
Counterfeit drug trafficking
Mail and wire fraud
Conspiracy
Money laundering
Outcome:
Convicted after trial
Sentenced to 17 years in prison
Significance:
One of the few jury trials stemming from AlphaBay-related drug sales.
đ Summary of Legal Lessons from AlphaBay Prosecutions
| Legal Issue | Explanation |
|---|---|
| RICO Charges | Applied to AlphaBay admins/moderators as participants in organized criminal enterprise. |
| Crypto Forensics | Blockchain analysis allowed tracing of Bitcoin/Monero transactions to suspects. |
| Operational Security | Poor OPSEC (e.g., using same usernames, carrying devices, lack of encryption) led to many arrests. |
| International Cooperation | Arrests occurred in Thailand, France, Canada, and othersâhighlighting global reach. |
| Moderator Liability | Even non-selling roles (like resolving disputes) led to criminal prosecution. |
| User Data Seizures | Server data seized from AlphaBay helped identify thousands of users and vendors. |
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