Monopoly Darknet Market: Suspected Operator Extradited to US – Source: www.govinfosecurity.com

FBI: Market Facilitated $18 Million in Illegal Drug Transactions via Cryptocurrency

Mathew J. Schwartz (euroinfosec) •
June 26, 2023    

The alleged leader of the notorious Monopoly criminal narcotics marketplace has been extradited to the United States to stand trial.

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The U.S. Department of Justice announced charges Friday against Milomir Desnica, 33, who’s a citizen of both Croatia and Serbia. He’s been accused of launching Monopoly in late 2019, serving as its administrator and profiting from commissions earned on all sales.

In July 2022, a federal grand jury in Washington returned against Desnica a two-count indictment and forfeiture allegation seeking all proceeds from his alleged crimes. He’s charged with conspiracy to distribute and possession with intent to distribute 50 grams or more of methamphetamine and money laundering. The charges respectively carry maximum sentences of life imprisonment and 20 years.

The case against Desnica is the result of a joint investigation by the FBI Washington Field Office’s Hi-Tech Opioid Task Force and Germany’s Zentrale Kriminalinspektion Oldenburg Cybercrime Unit that identified and located Desnica. He was arrested on a provisional arrest warrant by Austrian authorities on Nov. 2, 2022. Police searched his residence and vehicle and seized electronic devices and cash.

Austrian courts upheld the U.S. extradition request after Desnica contested it, and he was extradited Friday. The suspect is expected to make his first appearance in Washington, D.C., federal court Monday, before U.S. District Judge Carl J. Nichols.

The DOJ has accused Desnica of reviewing and approving all applications from individuals who wanted to sell their narcotics on Monopoly. All vendor applications included “descriptions of the drugs they wanted to sell, photographic proof of their inventory and an agreement to pay a commission for sales completed through Monopoly,” prosecutors said.

Vendors typically agreed to share 5% of their revenue with the Monopoly operator, according to court documents. Monopoly collectively earned vendors at least $18 million in revenue, the FBI said, which means the market’s operator allegedly earned over $900,000 in commissions.

Suspected Monopoly Players Busted

Monopoly was a darknet market, meaning the e-commerce site was reachable only by using the anonymizing Tor browser. The site sold opioids, stimulants, psychedelics and prescription medications as well as other drugs. Prosecutors said that in 2021, undercover U.S. law enforcement agents were able to purchase more than 100 grams of methamphetamine from Monopoly.

In May, a joint law enforcement operation with the codename SpecTor that was coordinated by the EU law enforcement agency Europol resulted in the seizure of Monopoly’s criminal infrastructure and the arrest of 288 suspects. Law enforcement agents also seized over $54 million in cash and virtual currencies, 850 kg of drugs – including amphetamines, cocaine, MDMA, LSD and ecstasy pills – and 117 firearms.

The nine countries that participated in SpecTor each arrested a number of suspects: the U.S. made 153 arrests, U.K. – 55, Germany – 52, the Netherlands -10, Austria – 9, France – 5, Switzerland -2, Poland – 1 and Brazil – 1.

“This operation sends a strong message to criminals on the dark web: International law enforcement has the means and the ability to identify and hold you accountable for your illegal activities, even on the dark web,” Europol Executive Director Catherine De Bolle said at the time.

The case against the alleged Monopoly players was built in part because German authorities seized Monopoly’s infrastructure in December 2021, which enabled police to start identifying vendors as well as customers. The FBI said it had received a digital forensic copy of the market database and forum database from Germany after requesting a Mutual Legal Assistance Treaty.

Following the Money

The FBI said it had identified Desnica after studying the market database seized by German law enforcement, which included invoices sent to vendors. Investigators found that all invoices to vendors included a bitcoin or monero address to which vendors were instructed to send the Monopoly operator’s commission, and while those payment details had been deleted for invoices prior to Oct. 22, 2021, they remained extant in later invoices.

The FBI analyzed numerous transactions involving the addresses apparently used by Monopoly’s operator. On a monthly basis, half of all funds received appeared to be routed to storage – apparently remaining untouched – and the other half were sent to cryptocurrency exchanges that didn’t retain user details. “Desnica then sold the illicit cryptocurrency to Serbia-based peer-to-peer traders in exchange for fiat currency – all in an effort to launder the proceeds of the illicit narcotics sales,” the Justice Department said.

A memorandum in support of detention that prosecutors submitted to the court on Saturday says that the FBI unmasked Desnica in part because it had identified “two bitcoin deposits from MoonPay.io into the wallet that also received the July 2020 Monopoly proceeds.” Records obtained by the FBI from the MoonPay cryptocurrency exchange enabled the bureau to identify the Google Pay account used to make the MoonPay deposits, which it traced back to credit cards and Gmail addresses used by Desnica. One of those email accounts included the 12-word seed phrase needed to access the Monopoly operator’s bitcoin wallet, the FBI said.

“He is directly tied to Monopoly Market by various social media, personal email accounts, and the seed phrases needed for Monopoly’s bitcoin wallet,” prosecutors wrote in the memorandum.