Quick facts (long story short):
- Deepdotweb was founded in October 2013 by Tal Prihar and Michael Phan
- Operators were managed to earn $8.4 million by kickbacks.
- DeepDotWeb was seized on May 7, 2019
The DeepDotWeb.com admin will spend 97 months in prison, a federal judge states. The name of this criminal is Tal Prihar, he is 37 years old. Donetta W. Ambrose, a United States District Court Judge, sent him to federal prison for laundering approximately $8.5 million in crypto. Read this article till the end to get to know the details!
The Essence of the Crime
In March 2021, Prihar pleaded guilty to money laundering. He revealed that in 2013, he launched the DeepDotWeb.com website to share the news of the dark web. The legal papers that feature this confession are now sealed. Between mid-Autumn 2013 and mid-Spring 2019, DeepDotWeb (DDW) used to be the largest site with the general information and the latest news from the darknet. It didn’t limit itself to publishing news about dark web markets. It also shared working links that people could click to access darknet marketplaces.
According to the Department of Justice, Prihar was sentenced to prison “for operating DeepDotWeb.” The attorney of the DDW owner emphasized the following fact in a sentencing memorandum: the operation of the site was not entirely criminal. Prihar violated the law when he began to create referral links to marketplaces to launder crypto. This is how his scheme worked:
- Prihar added customized referral links to his site
- Users who clicked these links found themselves on certain marketplaces
- When they spent money on those marketplaces, people behind the marketplaces shared a part of their profits with Prihar
The DoJ had to invest a lot of time and effort into explaining the importance of these referral links to people who understand little in darkweb.
The Main Information from the Sentencing Memorandum
Prihar’s attorney tried to summarize the criminal element succinctly in the sentencing memorandum. Prihar didn’t owe a dark web marketplace. He only shared links to third-party darknet sites that he mentioned in his pieces of news. He never forced anyone to click these links. He didn’t track the subsequent behavior of any user. He never knew which link a certain person clicked, what they ordered at a marketplace and how much money they spent there. But he knew that potentially, some DDW visitors could purchase illicit products on the marketplaces that DeepDotWeb mentioned. That was the only reason why Prihar pleaded guilty.
When launching DeepDotWeb, Prihar had no intentions of making money on marketplaces. His original plan was to create a reliable source of information for dark web users. The “kickback” scheme was introduced much later. Today, when people read about DDW, they might forget these details. They might think that Prihar used pieces of news as a pretext for generating profit on referral links. The attorney accentuated that the representatives of the justice system shouldn’t misinterpret Prihar’s intentions to pass a fair and accurate sentence for him.
How Much Money Did Prihar Earn?
The “kickback” scheme that was described above turned out to be incredibly profitable. It enabled DDW to earn over $15 million in crypto. However, Prihar didn’t put all this sum in his pocket. He acted together with Michael Phan, 34, born in Israel. The duo split the earnings so that each conspirator received around $8 million.
DDW could boast a huge audience. Nearly any popular dark web marketplace of the previous decade had affiliate links on this site. When Hansa and Alphabay servers were seized by investigators, these links were scrutinized. They revealed detailed information about all the transactions that took place in terms of the scheme. The numbers were impressive: Prihar made income on more or less 50% of transactions on Hansa Market. Accounts registered by users who relied on DDW referral links were responsible for 47% of all orders completed on Hansa and 23% on AlphaBay.
After being proven guilty, Prihar had to forfeit the following assets:
- The Deepdotweb.com domain
- Around 8,155 BTC
- Bank accounts
- A Binance account
- A Kraken account
- An iPhone
Phan will most likely have to forfeit his earnings too in the nearest future.
How Prihar Was Arrested
Slightly over a year prior to his arrest, Prihar relocated to Brasil together with his family. He realized the US government might have wanted to seize his activities. Prihar used to frequently fly to Israel from Brasil and back. He kept on doing so even after the feds executed arrest warrants and raided properties associated with him and his co-conspirator. On April 24, 2019, Phan and Prihar were charged via indictment. On May 6, the latter was arrested in France. He had a layover at the Charles de Gaulle Airport in France. A seizure banner came up on DeepDotWeb.com the same day. It looked like one of the banners that warn darknet users about marketplace seizures. In a while, Prihar convinced the French authorities to extradite him to the United States.
Some people might think that 97 months is not a long sentence — and when the DDW owner goes out of prison, he’ll be enjoying a premium lifestyle. In fact, he had to spend nearly all his savings on lawyers. He made a profit not only on referral links. His other sources of income were 100% legit: BTC exchanges and gambling sites as well as anonymous VPN software. All the funds that Prihar earned through these channels went straight to the bank. And he honestly paid taxes.
Before entering a guilty plea, Prihar gave an interview. He blamed the French police for antisemitism. One of the officers who arrested the DDW owner said “We caught another Jew who took the money”. Various supporters signed letters calling for Prihar’s release. One of these supporters was Rabbi Shlomo Goldfarb, a highly respectable person.
What About Michael Phan?
Even though Phan and Prihar were making money together, the former has not been sent to prison yet. The latter pleaded guilty in March 2021. On May 6, 2019, the Tel Aviv Police arrested two people in connection with this case. One half of this duo was Phan. He was charged with conducting illegal activities together with Prihar (while the second arrested person was not). Phan is still “fighting extradition” in Israel.
What Does the FBI Think About the Case?
The official opinion of the FBI might sound a bit extravagant to some people. For instance, the officials state that sites like DeepDotWeb allegedly pose global threats. They promise to arrest the operators of such websites in the nearest future.
Robert Jones, FBI Special Agent in Charge, believes that the fight requires global partnerships. Federal and international law enforcement should join forces to stop these crimes. DDW served as a gateway to the dark web where people from all over the world exchange and purchase illicit substances and other illegal items. Users who organized this type of business managed to make a huge profit on their nefarious transactions. Now, the operators of darknet sites should wait for the moment when the FBI knocks at their doors.