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Author Topic: How to NOT be a victim of a sting operation  (Read 7213 times)
markjamrobin
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February 08, 2014, 05:34:29 AM
 #41

Greedy fucks should rot in jail. Making tons of money with huge markups is not in the spirit of Bitcoin.

Bullshit! The spirit of bitcoin is personal freedom and capitalism. That is the embodiment of the free market.


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deepceleron
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February 08, 2014, 08:19:38 AM
 #42

What is significant about this is that actual victims that have had bitcoins stolen by actual thieves in felonious quantity have been given the complete brush-off by law enforcement, but here they are buying currency from a single individual who is not defrauding anyone, where there is and would be no victim, just to indict.

They can tack on any story that they want to the Bitcoin exchange "he said he got the bitcoins from selling drugs...", "we said we wanted to buy drugs and he sold to us anyway", even if such verbal exchange never happened, and can still harrass people through the plea-bargain or bankrupt you + 20 years jeopardy game. Why did these lawkeys decide that bitcoin currency exchangers were going to be their quota-makers?
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February 08, 2014, 08:49:29 AM
 #43

Basically dont do anything stupid or grossly illegal and im pretty confident that you will not be a victim of a sting operation...
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February 08, 2014, 09:49:02 AM
 #44

Yep.

The complaint against the guy who was arrested a couple weeks ago (not Shrem) said that an undercover informant attempted to buy some Bitcoin and said "I need these Bitcoin because I've got my eye on a sweet bag of cocaine on Silk Road" or some similarly ridiculously stupid thing.

The seller ignored the request and never sold him coins (but they still mention it in the complaint which is interesting)

The US is really a third world police state. In most of the civilized world it's just illegal for the police to incite to commit a crime.

Plus, is all this a joke? So they arrested two guys because the cops told them "I will use this money to buy stolen goods"? An US judge will accept that BS? Really? Again, in a civilized country the judge would tell to those cops to gtfo and to stop harassing citizens.

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February 08, 2014, 02:16:05 PM
 #45

The US is really a third world police state. In most of the civilized world it's just illegal for the police to incite to crime.

Plus, is all this a joke? So they arrested two guys because the cops told them "I will use this money to buy stolen goods"? An US judge will accept that bs? Really? Again, in a civilized country the judge would to those cops to gtfo and to stop harassing citizens.
It's even worse than that. The cops could also be lying about mentioning stolen goods, and it hardly matters.
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February 08, 2014, 02:22:43 PM
 #46

The US is really a third world police state. In most of the civilized world it's just illegal for the police to incite to crime.

Plus, is all this a joke? So they arrested two guys because the cops told them "I will use this money to buy stolen goods"? An US judge will accept that bs? Really? Again, in a civilized country the judge would to those cops to gtfo and to stop harassing citizens.
It's even worse than that. The cops could also be lying about mentioning stolen goods, and it hardly matters.

It's a dirty trick and borders entrapment. I'm sure they'll have proof to show that this happened. They'll need it to secure a conviction.
eldentyrell
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February 08, 2014, 03:57:32 PM
 #47

I think the Krebs article might be a (law enforcement originated?) hoax.

Krebs' website does not have links to any court documents, despite referring to "court documents" -- and he's ignoring the commenters (see comments on that page) asking for them.

The story seems to have been picked up by only three other sites, all of them small local news outlets.

I'm starting to wonder if law enforcement didn't "leak" a phony story to try to scare people.

The printing press heralded the end of the Dark Ages and made the Enlightenment possible, but it took another three centuries before any country managed to put freedom of the press beyond the reach of legislators.  So it may take a while before cryptocurrencies are free of the AML-NSA-KYC surveillance plague.
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February 08, 2014, 04:03:58 PM
 #48

I highly doubt it.  Krebs is a pretty smart and connected guy. He said a press release was issued.

However the Miami State Attorneys' office has not yet published that press release.

http://news.miamisao.com/

Call them and ask for a copy of the press release. I'd like to read it too.  They only unseal portions of indictments if and when they will not interfere with the ongoing investigation so it may be a while before we see the legal documents.

EDIT: which means more arrests could be pending...

eldentyrell
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February 08, 2014, 11:11:11 PM
 #49

I highly doubt it.  Krebs is a pretty smart and connected guy.

Yes, I know, I read his site regularly.  But even smart people get false information "leaked" through them now and then.  For the record I am definitely not accusing Krebs of perpetrating a hoax.  But I do suspect that somebody (law enforcement? fincen?) might be using him as an outlet.

The major red flag for me is that he mentions "court documents" three times in the article but doesn't link to them.  He lives almost 1,000 miles from Miami and this went down less than 12 hours before he posted the article, so if they're not in electronic form I don't understand how he could have seen them.

He's also active in his articles' comments, including this one, but is strangely ignoring peoples questions about the "court documents".

Another intermediate possibility is that some mid-level law enforcement officer jumped the gun on this, running a sting and grabbing these guys without discussing it thoroughly with senior enough prosecutors.  End result these guys get set loose with no charges in a few days and we never know the difference.  Since this was a sting there were clearly "operations" people involved; maybe it was all operations people and no lawyers, and right now those operations people are sitting down with a bunch of state attorneys who are explaining to them that "yes, that law is on the books" but their time is not well spent (nor their careers advanced) by chasing kids for trading baseball cards.  Even if baseball cards are "trendy" right now and all over the news.

The printing press heralded the end of the Dark Ages and made the Enlightenment possible, but it took another three centuries before any country managed to put freedom of the press beyond the reach of legislators.  So it may take a while before cryptocurrencies are free of the AML-NSA-KYC surveillance plague.
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February 09, 2014, 08:33:08 AM
 #50

The news piece has been all over the place and actually mentions three people arrested.  Reading the court docs will be more telling.  The smart thing for large seller would be to switch accounts at certain intervals on localbitcoins to not attract the label of selling XBT "as a business"  Also in communications with buyers make it clear that it's a personal sale / hobby activity and not a for profit business reselling XBT.  localbitcoins if they care enough about this could also change the history logs to stop showing past XBT volumes as the news story made it seem that it was a factor in the arrests as well.
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February 09, 2014, 12:44:41 PM
 #51

The news piece has been all over the place

Um, no.  The link has been reposted "all over" a bunch of blogs.

A full 48 hours after the story broke, Google News shows only six (count 'em, six) publications running this story.  For comparison, there are 110 stories currently running about "mtgox withdrawals".

Try searching for the guy's names "Pascal Reid" or "Michell Abner Espinoza".  Another dozen pages include a one-sentence mention of the event as part of a larger story on bitcoins in general.

  https://www.google.com/search?pz=1&cf=all&ned=us&hl=en&tbm=nws&gl=us&as_q= Pascal+Reid&as_occt=any&as_qdr=a&authuser=0

  https://www.google.com/search?pz=1&cf=all&ned=us&hl=en&tbm=nws&gl=us&as_q=Michell+Abner+Espinoza&as_occt=any&as_qdr=a&authuser=0

Remember to search google news, not google, so you get real news publications instead of just link-propagating blogs.

Still no court docs.

The printing press heralded the end of the Dark Ages and made the Enlightenment possible, but it took another three centuries before any country managed to put freedom of the press beyond the reach of legislators.  So it may take a while before cryptocurrencies are free of the AML-NSA-KYC surveillance plague.
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February 09, 2014, 05:00:12 PM
 #52

...court docs.

Businessinsider has provided a to the criminal complaints  link, here.



http://www.businessinsider.com/localbitcoinscom-targeted-by-feds-2014-2
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February 10, 2014, 03:31:55 AM
 #53

According to the documents, Michael doesn't seem entirely blameless here.  Roll Eyes

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February 10, 2014, 08:22:41 AM
 #54

Reading the above case screams entrapment to me.

"In criminal law, entrapment is when a law enforcement agent induces a person to commit an offense that the person would have otherwise been unlikely to commit"

- The undercover induced the seller to commit the offense by contacting him and baiting him with larger and larger amounts of money.

- The seller would have otherwise been unlikely to commit money laundering if he wasn't presented with a large amount of "dirty money" to launder

Which is illegal in Europe and most (if not all) first world countries.

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February 10, 2014, 09:48:13 AM
 #55

Reading the above case screams entrapment to me.

"In criminal law, entrapment is when a law enforcement agent induces a person to commit an offense that the person would have otherwise been unlikely to commit"

- The undercover induced the seller to commit the offense by contacting him and baiting him with larger and larger amounts of money.

- The seller would have otherwise been unlikely to commit money laundering if he wasn't presented with a large amount of "dirty money" to launder

Which is illegal in Europe and most (if not all) first world countries.

The USG seem to have different rules for entrapment. Didn't they do a similar thing with the SR case?

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February 10, 2014, 10:04:47 AM
 #56

Reading the above case screams entrapment to me.

"In criminal law, entrapment is when a law enforcement agent induces a person to commit an offense that the person would have otherwise been unlikely to commit"

- The undercover induced the seller to commit the offense by contacting him and baiting him with larger and larger amounts of money.

- The seller would have otherwise been unlikely to commit money laundering if he wasn't presented with a large amount of "dirty money" to launder

Which is illegal in Europe and most (if not all) first world countries.

The USG seem to have different rules for entrapment. Didn't they do a similar thing with the SR case?

Yes, entrapment its a usual practice among US police forces - its kinda crazy, LE is commiting crimes while inciting US citizens to commit more crimes in order to throw them to jail.

"The land of the free"

Sure.

eldentyrell
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February 10, 2014, 08:35:36 PM
 #57



Ok, thanks, I believe it now.

Gotta say, this is some pretty over-the-top enforcement aggression.

The printing press heralded the end of the Dark Ages and made the Enlightenment possible, but it took another three centuries before any country managed to put freedom of the press beyond the reach of legislators.  So it may take a while before cryptocurrencies are free of the AML-NSA-KYC surveillance plague.
5thStreetResearch
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February 10, 2014, 09:47:10 PM
 #58

use encrypted email and dont be a jackass about who you do business with

BittBurger
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February 10, 2014, 09:52:17 PM
 #59

Laundry may be a charge they attempt to tack on, but they never would have made the sting without the accessory to a crime part...

This is correct.   And honestly should be obvious to everyone already.

They had to create a completely unrelated "crime" (going to use this for credit card theft) in order to "create a crime" in these purchases.  Granted, they were above the $10,000 limit, but that wasn't sensationalistic enough.  This is why many feel that this move on the part of the police was extremely lame.  They intentionally sought out a Bitcoin scenario, found dumb people, and turned it into a money laundering situation.  I lost a lot of respect for law enforcment in that regard, but it would only have worked with stupid people involved.  You can be assured this is the one they succeedded with.   There were plenty other people who probably said "Credit card theft?  Sorry, I can't do this exchange".   That part never gets reported of course...

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bitcoinminer
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February 10, 2014, 09:55:37 PM
 #60

use encrypted email and dont be a jackass about who you do business with

Exactly.  The government can't crack "Encrypted" communications.

They have to rely on noticing encrypted communications and hacking the computers at both ends, which they are almost 100% successful at.

How not to be a victim of a sting operation:

"Don't break the law or assist others in breaking the law"

Be fearful when others are greedy, and greedy when others are fearful.

-Warren Buffett
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