Dozens Of Minor Victims Who Were Being Actively Abused By The Users Of The Site Rescued
Jung Woo Son, 23, A South Korean national, was indicted by a federal grand jury in the District of Columbia for his operation of a site known as “Welcome To Video.” Son’s site was the largest child exploitation market by volume of content. It distributed over 1 million videos, including more than 250,000 unique videos, 45 percent of which included images that were previously unknown to the National Center for Missing and Exploited Children.
Users could join the site for free and download videos. However, they could also earn “points” by uploading videos and referring new users. Also , as of March 2018, a “VIP” account, that came with unlimited downloads for six months, was available for Bitcoin valued at $353.
On October 16, 2019 the nine-count indictment was unsealed. Along with the indictment was a parallel civil forfeiture action. Son was also charged and convicted in South Korea. He is currently in custody and serving his sentence in South Korea. An additional 337 site users residing in multiple states were arrested and charged. Arrest and charges were also made in the United Kingdom, South Korea, Germany, Saudi Arabia, the UAE, Czech Republic, Canada, Ireland, Spain, Brazil, and Australia.
Tracked Through Bitcoin Transactions
Demonstrating their expertise in conducting financial investigations, IRS Special Agents traced the sophisticated bitcoin transactions to ultimately crack this case. By tracing the bitcoin transactions, special agents were able to determine the location of the Darknet server, identify the administrators of the website and ultimately track down the website server’s physical location in South Korea. With the assistance of law enforcement partners in South Korea and around the world, law enforcement successfully rescued child victims and brought to justice the perpetrators of the criminal activities.
Crucial in the Jung Woo Son investigation was the ability to analyze the blockchain and de-anonymize bitcoin transactions. This allowed investigators to identify hundreds of predators around the world.
Search Warrants Executed
On March 5, 2018, agents from IRS, Criminal Investigations, HSA, National Crime Agency in the UK and the Korean National Police in South Korea arrested Son and seized the server used to operate a Darknet Market. This market, exclusively advertised child sexual child sexual exploitation videos available for download by members of the site. The investigation resulted in the seizure of approximately 8 terabytes of child exploitation videos, the largest seizure of its kind. The National Center for the Missing and Exploited Children (NCMEC) are analyzing over 250,000 unique videos seized during the operation. Approximately 45% of the analyzed video contain new images that have not previously known to exist.
The Welcome To Video site offered these videos for sale using the cryptocurrency bitcoin. This Darknet website is the first of its kind to utilize bitcoin for child exploitation videos. As a form of bragging, the site boasted over one million downloads of child exploitation videos by users. As part of the subscription process, each user received a bitcoin address when they signed up on the website. Investigative analysis revealed that the website had more than one million bitcoin addresses.
In the D.C.-metropolitan area, the operation has led to the execution of five search warrants and eight arrests of individuals. These individuals both conspired with the administrator of the site and were themselves, users of the website. Two users of the Darknet market committed suicide subsequent to the execution of the search warrants.
Law Enforcement Sharing Of Information
The agencies involved with the Jung Woo Son investigation have shared data from the seized server with law enforcement around the world. This is a unified effort to identify and prosecute customers of the site. This has resulted in leads being sent to 39 countries and the arrests of 337 subjects around the world. In the United States alone, the operation has resulted in the searches of residences and businesses of approximately 92 individuals. The operation is also responsible for the rescue of 23 minor victims living in the United States, Spain, and the United Kingdom, who were being actively abused by users of the site.
Asset Forfeitures
As in many federal investigations, federal asset seizure warrants were issued in this investigation. In a forfeiture complaint unsealed on October 16, 2019, law enforcement outlined how they were able to trace payments of bitcoin to the Darknet site. This was accomplished by following the flow of the funds on the blockchain. The virtual currency accounts identified in the complaint were allegedly used by 24 individuals in five countries to fund the website and promote the exploitation of children. The federal forfeiture complaint seeks to recover these funds and, ultimately through the restoration process, return the illicit funds to the victims of the crime.
Cryptocurrency & Crime
This investigation is a classic example of how bitcoin can be used to carry out a large scale, international criminal operation. As with investigations of this type, the focus is “follow the money.” Although this adage has been used since the days of Al Capone, it still rings true. It’s just that the face of the money has now changed. No longer does the money contain the face of a president. It is now the faceless byte of digital data.
Even though criminal perpetrators may act under the assumption that their transactions may remain anonymous, it just goes to show that this may not necessarily be true. They need to remember that those with the experience and expertise to follow the money, just may be on their digital trail.
Follow-up Series
The Jung Woo Son investigation is significant in many respects. Most importantly, it caught many individuals involved in the act of child exploitation red-handed. Secondly, law enforcement was able to successfully rescue numerous child victims, and put their perpetrators behind bars. Lastly, it is a significant and unique investigation where cryptocurrency was deeply embedded in the fabric of the crime.
Because of the importance of this investigation, there is just too much to address in one blogpost. Simply put, there is much to be learned from this case. Not just from an investigative standpoint, but in a following of the money standpoint. Cryptocurrency has already been utilized in criminal activity many times before this investigation. But this case is a classic example of ow cryptocurrency can be used in a large scale criminal operation.
Unfortunately, what we are seeing here is the future of criminal activity. Not to be cliche, but we have seen the future of crime and its name is cryptocurrency.
Because I believe that we have a lot to learn from this investigation, I will follow-up this post with a series of blog posts devoted to the finer details of this investigation. This is in an effort to try and expose just how cryptocurrency played into this scheme and how it was uncovered. Hopefully we can all learn from the important groundwork this investigation has laid.