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Brett Johnson: US Most Wanted Cybercriminal | Lex Fridman Podcast #272


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I was on the run for four months, stole $600,000.
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I was in Las Vegas, Nevada.
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One day I had stolen the night before
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and stolen 160K out of ATMs.
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Went in the next morning, I woke up,
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signed on to cartersmarket.com,
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which was ran by Max Butler, the Iceman.
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And there's my name, US Most Wanted on it.
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And that gets your attention.
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That was my real name with US Most Wanted beside of it.
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Nobody knew my real name in that environment at all,
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but then they did.
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And it was talking about me being part
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of the Secret Service, Operation Anglerfish,
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everything else.
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So of course, they're all like.
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Everybody's after you.
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They're like, oh yeah, we're gonna get this son of a bitch.
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The following is a conversation with Brett Johnson,
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a former cyber criminal who built the first
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organized cybercrime community called Shadow Crew
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that is the precursor to today's Darknet
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and Darknet markets.
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He's referred to by the United States Secret Service
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as quote, the original internet godfather.
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He has been the central figure in the cybercrime world
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for almost 20 years.
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Placed on the US Most Wanted list in 2006
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before being convicted of 39 felonies for cybercrime,
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escaped from prison, and then eventually being locked up,
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served his time, and now is helping people understand
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and fight cybercrime.
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This was a raw, honest, emotional, and real episode.
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Brett has caused a lot of pain to a lot of people,
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and yet his own story is full of trauma and pain,
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and also redemption and love.
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This is a good time to say that I have and I will
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talk to people who have served time in prison,
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and perhaps people who currently are in prison.
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I will try to do my best to both empathize
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with the person across from me and not let them sugarcoat,
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explain away, or dismiss the crimes they committed.
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This is a tough line to walk,
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because if you close your heart to the other person,
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you'll never fully understand their mind and their story.
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But if you open the heart too much,
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you can be manipulated to where the conversation
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reveals nothing honest or real.
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This requires skill and willingness to take the risk.
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I don't know about the skill part,
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but I'd like to take the risk.
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I always wear my heart on my sleeve.
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If I get hurt for it, that's life.
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As I've said, I want to understand
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what makes a person do these crimes,
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the particular characteristics of their temporary
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or permanent madness, their justifications,
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but also their humanity.
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I believe each of us have the capacity
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to become both the criminal and the victim,
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the predator and the prey.
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It's up to us to avoid these paths
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or to find the path to redemption.
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It's on each of us.
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It's our responsibility and burden
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of being human in a complicated and dangerous world.
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This is the Lex Friedman podcast.
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To support it, please check out our sponsors
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in the description.
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And now, dear friends, here's Brett Johnson.
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You were convicted of 39 felonies for cybercrime
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placed on the US most wanted list in 2006,
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escaped from prison.
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You built the first organized cybercrime community
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called Shadow Crew that is the precursor
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to today's darknet and darknet markets.
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And for all this, the US intelligence service
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called you the original internet godfather.
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So first question, how did your career
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as a cybercrime criminal begin?
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My life of crime begins when I'm 10 years old.
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10 years old, man, think about that.
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I mean, you were probably playing the robots
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when you were 10.
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You know, usually kids are doing the Lego bit,
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getting involved with sports, everything else.
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And with me, it wasn't like that.
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With me, I'm from Eastern Kentucky.
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Eastern Kentucky is one of these,
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it's like parts of Texas, parts of Louisiana,
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that if you're not fortunate enough to have a job,
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you may be involved in a scam, hustle, fraud,
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whatever you want to call it, man.
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I was, my parents, my mom was basically
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the captain of the entire fraud industry.
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So this is a woman that at one point,
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she's stealing a 108,000 pound Caterpillar D9 bulldozer,
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tramming it down the road.
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You know, at another point, she's taking a slip
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and falling a convenience store trying to sue the owner.
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We had a neighbor she acted as a pimp for at one point.
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That's my mom, my dad.
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Wait, wait, wait, the neighbor acted as a pimp?
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My mom prostituted, I mean,
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she acted as a pimp for a neighbor.
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Her name was Debbie and my mom used to sell her out.
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Debbie needed money and my mom would find men
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for her to sleep with for cash
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and she'd take a part of the cash.
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So Sauna's like she diversified the methodologies
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by which she hustled.
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Very, had that entrepreneurial spirit.
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Okay.
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You know, we see that a lot with cyber criminals,
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you know, that sense of being that entrepreneur.
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So what was the motivation you think for her?
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Is it money?
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Is it basically the rush of playing with the system
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or being able to know the rules
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and break the rules and get away with it?
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My mom's a complex character.
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She is, there's no one single motivation.
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So my mom was the individual, she's still alive.
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My mom was the individual who tested people.
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She wanted to know how far she could abuse you
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and you come back and still love her.
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So, and that was with every relationship she's ever had.
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She would cheat on the men she was involved with.
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She would abuse her children, me and Denise.
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She would...
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Psychological, physical?
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Oh, it was mental, emotional, physical,
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everything, everything.
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I mean, she used to beat me and Denise with belt buckles,
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you know, and that ended when she was,
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I forgot what we had done.
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It wasn't much.
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I think that it may have been the part
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where she accused me of stealing her marijuana,
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but she was hitting me and Denise.
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We were living in a single wide trailer at that point.
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She was hitting me and Denise.
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We were on the bed trying to get away from it.
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And Denise kicks her through a closet is what happens.
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And Denise stands up and she said,
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you're through hitting me.
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And that was the last time that mom hit us at that point.
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But...
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So sorry to take us there.
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You're, for people who know you
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and people should definitely watch
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some of your lectures online.
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You're extremely charismatic and fun and jolly
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and whatever word you want to use.
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But, you know, if we look at that kind of life,
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there's darkness there, there's a struggle there.
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There's a lot of darkness.
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So if you, how did you feel?
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If you go back to the mind of the kid you were
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with your mom, was there sadness?
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Was there things like depression, self doubt,
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all those kinds of things, or did you see this crime,
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this chaos as ultimately exciting?
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You know, I don't think,
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back then I didn't view it as exciting.
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Now it becomes exciting when I start being involved
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in cyber crime, all right?
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But back then it was simply a means to an end
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was all it was.
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So you take a 10 year old kid
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and the way I get involved in crime is,
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like I said, my mom was the fraudster.
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My dad was a good guy.
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He just forgot he was this good guy.
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You know, he was always, he always had these principles,
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but his issue was is he loved my mom so much,
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he was scared of her leaving.
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So if she wanted to do something, commit crime,
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cheat on him, whatever,
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he would pretty much just put up with it the one instant.
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So, I mean, this woman used to,
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she used to bring men home in front of him,
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tell him that, hey, I'm leaving you.
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I don't love you anymore.
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I want you to die, blah, blah, blah, blah, blah.
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This was my mom.
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There were two instances where the man,
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where he can't take it anymore.
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And the first instance, I was,
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I guess I was seven or eight.
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My sister Denise is a year younger than I am.
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My dad actually files for divorce,
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files for divorce at that point.
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My mom kind of goes crazy.
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My dad, I was with my dad.
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My sister was with my mother
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because that's that Eastern Kentucky mentality.
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You know, men stay with men, women stay with women.
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So he was filing for divorce.
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Me and my dad, we were living in an apartment.
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My mom was living with her grandparents
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and with her parents bouncing back and forth
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between the two.
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And I remember I was sleeping in the bed.
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We had a single wide bed.
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My dad slept on the sofa.
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I woke up one night
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and there was some sort of ruckus in the living room.
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So I wake up and I walk into the living room
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and my mom has a knife to my dad's throat.
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And basically you're not going to steal my son from me.
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My mom was this individual
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that when she knew she went so far,
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like I said, she was always this person that tested.
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What can I do this to you?
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And you'll still come back.
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She knew, she was always also this person
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that if she went too far, she knew it.
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And she would always try to divert that into something else.
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All right, so she knew at that point she'd went too far.
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So what does she do?
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She gets up crying, goes to the bathroom
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and pretends to slit her wrists
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so that my dad Ray will respond to that,
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not respond to what she's just done to him.
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That was my mom in a nutshell.
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She had a history of doing this kind of stuff.
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Motivations as far as fraud with her,
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I think with her it was, she was an LPN.
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She had a very good nurse, but she didn't want to work.
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It was a lot of it.
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So with her, it was easier for her to commit fraud.
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And when I say commit fraud,
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it was against businesses, against people.
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I remember at one point she's buying
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over the counter capsules and emptying the capsules out
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and putting some other crap in there
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and selling at a speed and people were buying it.
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She did anything she could for money.
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And of course I get involved with that.
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What happens is we were in Panama City at that point
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and my mom leaves my dad and the way she left my dad,
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my great grandfather had died.
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My mom tells all three of us, hey, I'm taking the kids
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and we're going back to Eastern Kentucky
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to attend the funeral.
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Well, that was her leaving.
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Me and Denise didn't know it.
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She didn't pack any of our clothes at all.
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She stows her clothes in the trunk of the car
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and she leaves my dad and I don't get to see my dad again
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for I think five, six years, something like that.
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My mom, like I said, she used to bring men home
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in front of my dad.
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She would, he'd sit there and cry and beg her not to do it.
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She'd do it anyway.
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When she leaves him, she kept up that.
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So we were living at my grandparents house.
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My grandfather, he had converted the house.
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He had raised the house up
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and built apartments underneath of it.
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So me and my sister and my mom lived
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in one of the apartments underneath
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and that whole side of the family was just nuts, was nuts.
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My granddad, Paul, he would,
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this is a man that he didn't want you
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to eat any of his food.
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So, you know, there was no such thing
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as me and Denise going upstairs to eat.
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If he found out me and Denise was taking a bath,
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we were allowed to bath and bathe in two inches of water
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one time a week
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because he didn't want to have to pay the water bill.
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There's rules.
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There are rules.
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You know, if you couldn't have the TV on,
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when he went to bed at night,
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you had to have the television, the volume.
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You could watch it, but without volume
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because if he heard it, he would get up
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in the middle of the night
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and he would kick the power breaker,
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turn off all the power on you.
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This is my, this is my, the family, right?
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So my mom, she used to leave me and Denise at home
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for days, man, for days.
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She'd go out and, you know, party.
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And I mean, sometimes she'd take me into these with her.
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We'd wait in the car.
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Sometimes we'd wait in the living room
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as she went and partied and everything else.
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Most of the time she left us at home
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and my entry into crime, Denise walks in one day,
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she's nine years old, man.
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She walks in one day
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and she's got a pack of pork chops in her hand
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and looked at her and I said, where'd you get that?
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She's like, I stole it.
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And you know, it's like, show me how you did that.
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So she takes me over
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and she shows me how she steals food,
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how she's stuffing it down her pants.
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So we start stealing food.
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I'm like, hell yeah, let's do that shit.
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So start stealing food.
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And we get to the point where we're wanting a sandwich.
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Well, you can't stuff a loaf of bread down your pants.
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So there was a Kmart in the shopping center.
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I go over to the Kmart, get a hoodie off the rack,
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take the tags off of it, wear it out, work just fine.
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And the way you steal bread
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is you put the hoodie over your shoulder,
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stuff a loaf of bread down the sleeve
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and you walk out with it.
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So we started doing that.
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How'd you figure that out?
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Just thought pattern.
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So there's like strategic thinking here.
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Yeah, you know, you can't wear the hoodie
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and put the bread down here
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cause you might mash the bread when you zip it up
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or they might notice the bread.
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Yeah, we have to think through that.
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You gotta think through it.
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But you gotta realize by this point,
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I'm already seeing what my parents are doing.
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You know, I'm already seeing the plotting.
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That kind of puzzle solving
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was something you were already developing yourself
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individually cause you're pretty young.
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Yeah, 10 years old, pretty young.
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But seeing how they act, how they respond to things.
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And my mom, I guess you could call it a good thing,
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they never kept any of that hidden from the kids.
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You know, there was no discussions behind closed doors.
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All that happened in front of everybody.
link |
00:14:19.300
And from your young minds perspective,
link |
00:14:22.320
seeing that kind of crime, you basically,
link |
00:14:25.920
you know, a lot of us kind of grow up
link |
00:14:27.660
thinking there's rules you're not supposed to break.
link |
00:14:29.820
If you see other humans breaking those rules,
link |
00:14:31.940
then you realize those rules are just human made.
link |
00:14:35.680
But it gets worse than that.
link |
00:14:37.120
I was in an environment where there were no decent people.
link |
00:14:42.880
I didn't really meet my first decent person
link |
00:14:45.040
until I was 16 years old.
link |
00:14:47.160
Who's that?
link |
00:14:48.000
That was a high school teacher.
link |
00:14:49.920
So what happens is, you know, we start shoplifting food.
link |
00:14:54.480
My mom finds out that we've been stealing stuff
link |
00:14:56.720
and you know, she joins us.
link |
00:14:59.040
What's that?
link |
00:14:59.880
She joins us.
link |
00:15:00.880
Yeah, she comes in, you know, I've got the television,
link |
00:15:02.780
I've got the Atari 2600, play the hell out of it.
link |
00:15:05.120
Oh my God.
link |
00:15:05.960
She starts seeing this shit.
link |
00:15:06.880
She's like, where'd this come from?
link |
00:15:08.020
And I'm like, well, we found it.
link |
00:15:09.200
She's like, you didn't find that.
link |
00:15:10.360
Denise, Denise stands up, we stole it.
link |
00:15:13.520
My mom, show me how you did that.
link |
00:15:16.680
And she gets her mom too, to join in.
link |
00:15:19.520
And she used to run me and Denise
link |
00:15:20.760
as these little shoplifters.
link |
00:15:21.980
We'd take, you know, we'd steal stuff for her.
link |
00:15:24.520
We would distract security
link |
00:15:27.760
and her and my grandmother would steal stuff.
link |
00:15:30.840
They got caught doing that.
link |
00:15:32.380
But that's the entry into crime.
link |
00:15:34.920
And Denise, you know, I'm adamant and I kind of mean it.
link |
00:15:41.280
But the truth is I say, and I do mean it,
link |
00:15:45.760
that I'm responsible for my choices as an adult, all right?
link |
00:15:49.760
I believe that when you're a child, you can't control that.
link |
00:15:52.240
The adults in your environment control what you do.
link |
00:15:55.020
All right?
link |
00:15:55.860
Once you're an adult though, your choices are yours.
link |
00:15:58.900
Now that being said, there's some,
link |
00:16:03.700
you can't dismiss that childhood
link |
00:16:07.940
influencing what I did as an adult.
link |
00:16:10.880
You can't do that.
link |
00:16:12.140
I mean, it was kind of written on slate that,
link |
00:16:14.960
hey, this guy's gonna be this guy when he grows up.
link |
00:16:18.280
That's like sometimes that one person you meet,
link |
00:16:20.740
that decent person can turn the tide of your life.
link |
00:16:23.800
Absolutely, absolutely.
link |
00:16:24.640
So what happens is, you know, the abuse,
link |
00:16:26.600
everything continues on, when I'm 15,
link |
00:16:30.520
my dad was in Panama City, Florida.
link |
00:16:33.520
My mom was in, you know, we were in Hazard, Kentucky.
link |
00:16:38.560
She was dating this guy.
link |
00:16:40.520
My mom was this woman that the abuse would,
link |
00:16:46.280
it was crazy abuse, man, just crazy stuff.
link |
00:16:49.500
She would tell me and my sister, you know,
link |
00:16:52.040
that she gave up her life for us,
link |
00:16:55.080
that she was gonna leave one day and never come back,
link |
00:16:57.680
that we'd find her dead in a ditch someplace.
link |
00:17:00.240
She'd go out and date these men and she'd come back
link |
00:17:02.080
and she'd talk about how these men were abusing her.
link |
00:17:05.680
You know, so she'd be dating this guy
link |
00:17:07.560
and she'd come back and she'd, you know,
link |
00:17:10.680
start talking about how he had tried to rape her,
link |
00:17:13.080
you know, trying to get me to respond to that.
link |
00:17:14.640
And I would respond to that.
link |
00:17:16.100
Make no doubt, I would respond to that.
link |
00:17:18.520
Well, what happens is, and I knew that,
link |
00:17:21.320
I don't know if I knew it was abuse at that age, all right,
link |
00:17:23.920
but I knew things were fucked up.
link |
00:17:25.840
And I was talking to my dad in Panama City
link |
00:17:29.200
and I really had it in my head
link |
00:17:30.840
that I was gonna go down and live with my dad.
link |
00:17:35.480
And I called my dad one day.
link |
00:17:40.480
I was set to go to, me and my cousins
link |
00:17:42.920
were gonna go see Return of the Jedi.
link |
00:17:45.240
It had came out again in the theaters.
link |
00:17:48.160
So I called my dad, it was a Sunday,
link |
00:17:50.480
called my dad and he told me,
link |
00:17:52.840
he had either gotten married
link |
00:17:54.480
or he was about to get married to this woman.
link |
00:17:56.880
And basically Brett Johnson
link |
00:17:59.480
wasn't gonna go down to Florida.
link |
00:18:01.200
You know, I was gonna stay in Hazard.
link |
00:18:03.680
I had to call my dad from payphone,
link |
00:18:05.060
but the result of that was I walked him into a hospital,
link |
00:18:11.320
got in an elevator and a woman got in the elevator
link |
00:18:15.560
at the same time and I snapped
link |
00:18:18.160
and beat the hell out of her right there.
link |
00:18:21.200
And I was 15, didn't really know what the fuck happened.
link |
00:18:27.320
Didn't really know, but.
link |
00:18:29.000
Just anger came from somewhere.
link |
00:18:30.520
Yeah, yeah.
link |
00:18:32.080
And you know, the elevator,
link |
00:18:37.640
beat the hell out of this lady.
link |
00:18:40.000
Turned out she looked a shitload like my mom,
link |
00:18:43.760
but the elevator doors open.
link |
00:18:48.760
And one of the security guards,
link |
00:18:51.420
I played basketball with his son.
link |
00:18:53.500
So he saw me immediately.
link |
00:18:55.140
I knocked the hell out of him, took off running,
link |
00:18:58.620
made it back to the house where my grandparents were.
link |
00:19:02.940
They didn't know what had happened.
link |
00:19:04.020
So I didn't say anything.
link |
00:19:07.500
About an hour later, Kentucky state police,
link |
00:19:10.140
they pull up in the front yard and two of them get out
link |
00:19:13.820
and I'm sitting on the front porch and me and my cousins are
link |
00:19:16.620
and they start walking up where everybody starts walking
link |
00:19:18.940
out of the house.
link |
00:19:19.780
And I'm like, I just remember saying, what do you want?
link |
00:19:21.700
What do you want?
link |
00:19:22.520
Well, you know what they wanted.
link |
00:19:23.900
They wanted to arrest Brett Johnson and they arrested me.
link |
00:19:27.820
I went in and I told them everything.
link |
00:19:31.340
Spent three months in a county jail.
link |
00:19:33.220
They didn't have juvenile facilities in that county.
link |
00:19:37.580
So I spent three months in solitary, went to trial,
link |
00:19:42.440
pled guilty to assault in the first degree.
link |
00:19:44.740
The judge sentenced me to time served
link |
00:19:48.540
and a psychological evaluation
link |
00:19:50.180
where they sent me to Louisville, Kentucky.
link |
00:19:54.020
Spent 30 days up there and they cut me loose.
link |
00:19:55.780
They wanted me to have counseling after that
link |
00:19:59.180
and never went to counseling.
link |
00:20:02.740
You know, I wanted to, but mom was like, don't need it.
link |
00:20:05.540
And so never went to counseling.
link |
00:20:08.140
And I became this pariah in the county. It's crazy, man.
link |
00:20:16.780
I mean, not a day goes by that I don't think about that.
link |
00:20:21.580
That moment in the elevator.
link |
00:20:23.460
Yeah.
link |
00:20:24.580
And what happens is, you know, you're 15.
link |
00:20:29.140
Fuck man, you're 15.
link |
00:20:31.580
So I go back to the high school that I was in
link |
00:20:34.660
and I'm this piece of shit.
link |
00:20:38.700
So everybody, you're not the outcast.
link |
00:20:41.460
Everybody knows.
link |
00:20:43.280
So I moved, we moved, we were in Whitesburg at that point.
link |
00:20:47.120
I finished up the year there and moved back to Perry County,
link |
00:20:52.260
which is where Hazard is.
link |
00:20:55.140
So we moved there and they've got three high schools here.
link |
00:20:57.940
They've got MC Napier, they've got Hazard High School
link |
00:21:00.260
and then they've got Dills Combs High School.
link |
00:21:02.700
So I was within, me and Denise were within
link |
00:21:07.500
half mile of MC Napier.
link |
00:21:10.820
Show up there the first day of school
link |
00:21:13.700
and I met me and my mom and my sister
link |
00:21:16.100
were walking into the school and the kids won't let me in.
link |
00:21:20.640
The kids stand out there, he's not coming in.
link |
00:21:26.740
So my mom starts raising hell and I'm like,
link |
00:21:29.240
nah, let's just go, let's go.
link |
00:21:30.780
So from there it was, we went down to the city school,
link |
00:21:33.380
Hazard and the principal tells my mom,
link |
00:21:36.940
Denise can come, he can't.
link |
00:21:40.540
So my mom wants to raise hell and I'm like, no,
link |
00:21:43.660
let's just take me to this other school.
link |
00:21:45.700
So this other school was like 15 miles away
link |
00:21:48.340
and country high school.
link |
00:21:55.320
So I go there and they accept me
link |
00:21:57.140
and I walked in the first day
link |
00:21:59.220
and this English teacher
link |
00:22:04.020
name's Carol Combs, I walked in
link |
00:22:07.220
and handed her the paper, she was my homeroom teacher
link |
00:22:11.940
and she heard this voice,
link |
00:22:14.380
that is the way she explains it today,
link |
00:22:15.820
she heard this voice and she looks up
link |
00:22:19.660
and she was like, son, have you ever done any drama before?
link |
00:22:24.020
And I'm like, no maam,
link |
00:22:27.580
but I'm interested in the academic team,
link |
00:22:29.240
I was this quick recall guy, right?
link |
00:22:31.340
And she's like, no.
link |
00:22:33.080
She's like, drama.
link |
00:22:37.580
I'm like, no, I'm not interested in theater,
link |
00:22:39.980
I'm interested in academics.
link |
00:22:41.980
Well, she was the head of the drama department
link |
00:22:44.520
and head of the academics department.
link |
00:22:46.040
So the deal was, tell you what,
link |
00:22:48.500
you can get on the academics team
link |
00:22:50.440
if you start with theater too.
link |
00:22:53.100
And I was like, okay.
link |
00:22:54.780
So what happens is she was the only,
link |
00:22:56.780
she was the first decent person I met in my life
link |
00:22:58.700
and she became this kind of surrogate mother to me.
link |
00:23:01.820
So under her tutelage,
link |
00:23:04.740
I become one of the top academic team guys in the state.
link |
00:23:09.740
Around there, I was captain of the team,
link |
00:23:11.380
I was this just scourge across all the counties
link |
00:23:15.740
in that part of Kentucky.
link |
00:23:16.660
If we had a meet, it was like,
link |
00:23:20.080
Jesus Christ, that's Brett Johnson.
link |
00:23:21.780
And it was like, she used to tell people
link |
00:23:26.580
they would, the high school that I came from was Whitesburg
link |
00:23:29.900
and the first time that Whitesburg came against us,
link |
00:23:32.820
she told me, I was talking to her about a year ago
link |
00:23:35.740
and she told me, she's like, Brett,
link |
00:23:37.920
she said, that first meet against Whitesburg,
link |
00:23:40.420
she said, the captain came in, looked at you and said,
link |
00:23:45.180
oh, you've got that Johnson boy on your team?
link |
00:23:47.580
And she said, my response was that Johnson boy is our team.
link |
00:23:52.240
So, but I did that and then with theater,
link |
00:23:57.740
I ended up, my senior year,
link |
00:24:00.540
I won best actor and actress in the state.
link |
00:24:04.060
Only guy to ever do that in the state.
link |
00:24:05.940
So, did pretty well, man, did pretty well.
link |
00:24:08.920
Had scholarships coming out of high school
link |
00:24:11.900
and everything else and I'm the idiot that turned them down.
link |
00:24:14.460
Ask you a funny question.
link |
00:24:15.700
Yeah.
link |
00:24:16.620
You'd make a hell of a, I mean,
link |
00:24:18.300
of all the many things you could probably do,
link |
00:24:20.220
you would make a hell of a actor.
link |
00:24:23.140
I'm very good on stage.
link |
00:24:24.820
I'm very good on stage.
link |
00:24:26.020
Have you acted professionally anywhere or not?
link |
00:24:28.780
Not professionally.
link |
00:24:29.620
We've done the college circuit and stuff like that.
link |
00:24:31.900
What happened was is, so I turned down the scholarships,
link |
00:24:38.260
you know, scared of leaving, I guess is what it was.
link |
00:24:40.140
Started in community college
link |
00:24:41.820
and the community college there hires
link |
00:24:44.580
a new theater director out of California.
link |
00:24:46.340
Well, he knew the guy
link |
00:24:48.020
that ran the San Jose State Theater program.
link |
00:24:50.900
A guy named Edward Emmanuel was his name.
link |
00:24:53.020
His claim to fame, he had written the Three Ninjas movie.
link |
00:24:56.340
Remember that, the three little ninja kids
link |
00:24:58.460
back in the eighties, he had written this damn film
link |
00:25:00.780
and it had made a shitload of money.
link |
00:25:02.900
So, he invites Ed Emmanuel to come down and see the play
link |
00:25:06.140
and Ed had written this Civil War piece.
link |
00:25:09.120
So, we put that on.
link |
00:25:11.440
I was doing like, it was a multiple role thing.
link |
00:25:13.660
I was doing like 18 different roles in the show.
link |
00:25:16.140
So, Ed sees the show and he was like, scholarship.
link |
00:25:19.580
He said, look, he said,
link |
00:25:20.780
right now you're a big fish in a small pond.
link |
00:25:22.660
We'll make you a big fish in a big pot.
link |
00:25:24.180
And I was like, deal.
link |
00:25:25.620
So, I took the scholarship, man.
link |
00:25:27.580
And he was like, I'll be back in two weeks.
link |
00:25:29.280
So, he flies out.
link |
00:25:30.380
Two weeks later, this guy flies back in.
link |
00:25:32.820
He drives down to where I'm living.
link |
00:25:35.400
I'm out shooting ball with one of my cousins and friends.
link |
00:25:39.580
He pulls up and he gets out of the car
link |
00:25:42.620
and I was like, I'm walking over to him.
link |
00:25:43.940
I was like, hey man, I'll walk you in.
link |
00:25:45.820
You can meet my parents.
link |
00:25:47.020
He's like, no, I got it.
link |
00:25:48.540
I was like, okay.
link |
00:25:49.540
So, I keep shooting ball.
link |
00:25:50.500
He walks in the house, stays about 15 minutes,
link |
00:25:54.780
walks out, white as a sheet, doesn't say a word to me,
link |
00:25:58.620
gets in the car, leaves.
link |
00:26:00.980
I don't hear from him again.
link |
00:26:02.760
Had no idea what went on.
link |
00:26:04.780
Takes me a couple of weeks.
link |
00:26:06.580
What happened is my mom, he walks in and introduces himself.
link |
00:26:10.620
My mom pulls a knife on the guy.
link |
00:26:13.420
I will kill you.
link |
00:26:14.780
You are not going to steal my goddamn son from me.
link |
00:26:17.700
Scares the guy to death.
link |
00:26:19.340
He bugs out and kind of broke my spirit at that point.
link |
00:26:24.340
I was like, okay.
link |
00:26:27.020
So, went into, just full fledged into scams,
link |
00:26:32.940
crimes, everything else.
link |
00:26:34.080
I had already been, when I was a minor,
link |
00:26:37.220
I'd already been kind of brought up
link |
00:26:39.100
on that side of the family with the crimes
link |
00:26:40.740
that they were doing.
link |
00:26:41.580
My mom was drug trafficking, the pimp stuff,
link |
00:26:45.380
illegally mining coal, charity fraud.
link |
00:26:48.780
Illegally mining coal?
link |
00:26:50.100
Yeah, wildcatting coal.
link |
00:26:51.380
So, you...
link |
00:26:52.220
Can you explain that?
link |
00:26:53.060
Yeah, so, to properly mine coal,
link |
00:26:55.980
you have to get a permit, all right?
link |
00:26:58.580
Eastern Kentucky, a lot of people don't,
link |
00:27:00.460
they can't afford the permits.
link |
00:27:02.580
They can get them a piece of equipment.
link |
00:27:04.340
You get a dozer or a loader or whatever you're going to get
link |
00:27:06.420
or an auger or what have you.
link |
00:27:08.260
So, you start mining, but you don't get the permit.
link |
00:27:10.740
So, you don't have to do the, you don't have to pay.
link |
00:27:12.900
Back then, it was like $3,500 for a two acre permit
link |
00:27:15.740
or $5,000 for a two acre permit.
link |
00:27:17.620
Let you strip mine the coal on that.
link |
00:27:20.540
Then you have to pay for the reclamation on top of that.
link |
00:27:22.780
So, once you uncover the pit, take the coal out,
link |
00:27:25.740
you have to cover back up the pit, sow grass,
link |
00:27:28.700
make sure everything is environmentally friendly.
link |
00:27:30.420
You got a silt pond, everything else at that point.
link |
00:27:32.940
So, the whole idea is you buy an acre of land
link |
00:27:35.060
or some area of land and then you can,
link |
00:27:36.940
there's a whole process you're supposed to go through.
link |
00:27:38.580
Entire process.
link |
00:27:39.580
How many people involved in a mining,
link |
00:27:41.940
the smallest number of people required
link |
00:27:43.980
for a mining operation?
link |
00:27:45.060
You can do it with three or four people.
link |
00:27:46.820
Okay.
link |
00:27:47.660
So, you've got your loader operator,
link |
00:27:48.480
you've got your dozer operator.
link |
00:27:49.900
You need, you can farm out the trucking to someone
link |
00:27:52.860
if you need that or trucking company if you need to do that.
link |
00:27:56.540
Then you've got your, whoever owns the business as well.
link |
00:27:58.700
So, very few people can run an operation like that
link |
00:28:01.780
and profit fairly well as long as
link |
00:28:04.700
you don't have to do the reclamation,
link |
00:28:07.100
all that crap on top of it, all right?
link |
00:28:08.860
The reclamation gets pretty expensive.
link |
00:28:10.900
So, if you're uncovering a pit of coal,
link |
00:28:14.460
a pit, so a ton of coal is basically about 36 cubic inches
link |
00:28:18.100
is what a 2000 pounds of coal weighs
link |
00:28:20.700
if you're in Eastern Kentucky
link |
00:28:21.860
because it's at the weight of the bituminous coal
link |
00:28:24.420
and everything.
link |
00:28:25.260
The fact that you know this is awesome.
link |
00:28:26.580
The fact that you know exactly the volume
link |
00:28:32.140
of a ton of coal, I mean, it's great.
link |
00:28:34.340
Yeah, you learn this shit, right?
link |
00:28:35.500
Can you rattle this shit off?
link |
00:28:36.620
So, you uncover the pit and then you've got to sell the pit.
link |
00:28:40.220
Well, the thing is, is that,
link |
00:28:41.860
where are you gonna sell the coal?
link |
00:28:43.260
Well, you sell it to one of these other coal tipples
link |
00:28:45.700
that knows that they're buying the shit illegally.
link |
00:28:48.660
So, back then a ton of coal was,
link |
00:28:50.620
they'd give you like 36 bucks per ton is what that is.
link |
00:28:54.140
And you'd have to go out and you'd test the BTUs on it.
link |
00:28:56.700
You take a sample to the lab, test the BTUs,
link |
00:28:58.980
you take that into the company.
link |
00:28:59.820
What BTU?
link |
00:29:00.820
British Thermal Unit.
link |
00:29:02.220
So, you'd test what the BTU on the coal was.
link |
00:29:04.780
How pure the coal is.
link |
00:29:05.860
How pure the coal is, what BTU it burns at.
link |
00:29:08.900
Back then, a good BTU was around 12.9
link |
00:29:12.540
was what you'd get, all right?
link |
00:29:14.100
So, 12.9 coal, $36 a ton.
link |
00:29:17.020
You'd take that sample over to the coal tipple.
link |
00:29:19.420
They'd say, okay, we'll buy this for you.
link |
00:29:21.540
How many trucks you got or how many tons you got?
link |
00:29:23.140
And you'd say, this is what we've got.
link |
00:29:24.700
Then you'd hire the trucking company.
link |
00:29:26.180
And where you get it out because you've got the agents
link |
00:29:29.900
that are looking for you by this point
link |
00:29:32.260
because the people that you've bought the rights
link |
00:29:36.020
to whoever the landowner is,
link |
00:29:37.660
you said you're gonna give them $2 a ton or whatever this is.
link |
00:29:41.380
Well, the other people there,
link |
00:29:42.500
are you paying them off or are you not?
link |
00:29:45.220
Well, if you're not paying them off, guess what?
link |
00:29:47.060
They know your ass is mining it illegally.
link |
00:29:49.940
They're gonna report you.
link |
00:29:50.980
Well, all of a sudden, you've got all these inspectors
link |
00:29:53.220
that are coming around and everything.
link |
00:29:54.420
Hey, we know what you're doing.
link |
00:29:55.940
So, they're looking for you to get the pit out.
link |
00:29:57.540
So, when do you get the pit out?
link |
00:29:58.940
Right in dead of night.
link |
00:30:00.140
So, you're loading it up two o clock in the morning,
link |
00:30:02.940
hauling this ass out is what you're doing.
link |
00:30:04.740
You sell it out from there.
link |
00:30:06.260
So.
link |
00:30:07.100
And your mom ran operations like this?
link |
00:30:08.940
Yeah, yeah.
link |
00:30:10.220
And you said you worked the mine too when you were younger?
link |
00:30:12.500
Yeah, I learned how to run a loader, run a dozer,
link |
00:30:14.180
learn how to clean off a pit, everything like that.
link |
00:30:18.700
So, this is the lifestyle you grow up in.
link |
00:30:22.020
You learn how to do this stuff.
link |
00:30:23.540
And so, I knew how to do charity fraud as well,
link |
00:30:27.100
insurance fraud, so.
link |
00:30:28.540
Charity fraud.
link |
00:30:29.660
Can we break down some of these?
link |
00:30:31.820
Charity fraud, it's much more romantic than what it sounds.
link |
00:30:34.580
It was basically, it was basically standing beside the road
link |
00:30:39.340
with a sign and a bucket taking up collections
link |
00:30:42.500
for homeless shelters, for abused women,
link |
00:30:44.860
for children, stuff like that.
link |
00:30:47.540
Then later on, I branched off.
link |
00:30:49.660
When I started off on my own,
link |
00:30:51.020
I would set up my own charity company
link |
00:30:53.380
and do some telemarketing and go on by
link |
00:30:55.140
and collect checks and things like that.
link |
00:30:57.100
We're gonna talk about that.
link |
00:30:58.140
But actually, can we just step back
link |
00:30:59.860
and talk about your mom and your dad?
link |
00:31:04.260
Given all of that, given all the abuse,
link |
00:31:08.980
the complex ways that she played with love,
link |
00:31:12.300
to see how far she can push you and the people around her,
link |
00:31:15.700
and they still love her.
link |
00:31:18.220
Today, do you love her?
link |
00:31:20.460
You know, I called my dad yesterday.
link |
00:31:22.660
My dad, he's dying now.
link |
00:31:24.500
He's got a heart condition.
link |
00:31:25.500
He's not gonna get the operation to fix it.
link |
00:31:27.340
So he's like, fuck it, I'm ready to go.
link |
00:31:29.220
And I'm like, I looked at him,
link |
00:31:30.420
because hell, I'm 52 now.
link |
00:31:32.660
Prior to 52, I'd have been like, no, you need to do this.
link |
00:31:35.180
But I looked at him and I was like, I understand.
link |
00:31:38.340
I understand.
link |
00:31:39.420
You're done.
link |
00:31:40.460
And so he's not gonna get the operation.
link |
00:31:42.780
I was talking to him yesterday and he asked me,
link |
00:31:44.220
he's like, have you seen your mom?
link |
00:31:45.780
And I was like, dad, I've not talked to her
link |
00:31:47.100
for about two years.
link |
00:31:48.660
And I told him, I was like, I love my mom,
link |
00:31:52.620
but my mom is not a good person.
link |
00:31:54.900
She's not.
link |
00:31:55.740
And he told me, I was talking to him on the phone yesterday,
link |
00:31:59.180
and he told me that it took him several years
link |
00:32:01.780
to really understand that.
link |
00:32:03.260
You know, he loved her too,
link |
00:32:04.780
but it takes, when you're getting abused like that,
link |
00:32:07.460
especially my dad, my dad came from a good family,
link |
00:32:09.940
everything else, and, you know, upstanding family.
link |
00:32:13.300
And I think that when you're that victim of abuse,
link |
00:32:18.460
you know, you've never seen it before,
link |
00:32:20.300
you've never encountered it, and then it happens,
link |
00:32:23.260
well, you're like that frog in water all of a sudden.
link |
00:32:25.300
You know, you get to the point where it gradually increases
link |
00:32:28.260
until how do you get out of it?
link |
00:32:30.100
Everybody else sees what's happening, but you don't.
link |
00:32:32.820
I grew up in that environment though, you know,
link |
00:32:34.740
so it took me a long time to come to terms with that.
link |
00:32:39.060
My sister came to terms with it long before I did.
link |
00:32:42.020
You know, my sister, she's been a decade
link |
00:32:44.180
without talking to my mom,
link |
00:32:45.860
like she had tried to commit suicide, I didn't know that.
link |
00:32:48.380
What got me so bad is she said at one point
link |
00:32:51.740
that she always thought someone was gonna come in
link |
00:32:55.020
and save us, and my response, just immediate response,
link |
00:32:58.180
not even thinking about it, my response was,
link |
00:32:59.900
well, Denise, I knew no one ever was.
link |
00:33:02.500
And looking at things now,
link |
00:33:06.060
I think that's where our paths diverged.
link |
00:33:10.500
Me, it was, if you wanna do it,
link |
00:33:13.220
if anybody's gonna take care of you,
link |
00:33:14.500
you gotta take care of yourself.
link |
00:33:15.980
You're on your own.
link |
00:33:16.820
You're on your own, you know, it's up to you.
link |
00:33:20.140
And Denise has always been that child
link |
00:33:24.100
that has expected someone to come in and save her.
link |
00:33:27.780
Well, and almost like it's all going to be okay, somebody.
link |
00:33:31.380
Yeah, and I knew it wasn't.
link |
00:33:33.580
No, no, you go.
link |
00:33:34.420
Unless you.
link |
00:33:35.260
Unless you make it okay, it ain't gonna be okay.
link |
00:33:38.460
So, you know, I was.
link |
00:33:40.820
Are you able to forgive her, your mom?
link |
00:33:45.220
My boundary with my mom, the reason I've not spoken with her,
link |
00:33:49.580
over two years ago, I started this legal career of mine.
link |
00:33:55.780
I've been the guy who has,
link |
00:33:57.540
I spent a lot of time thinking about my past
link |
00:34:01.420
and those choices and what brought those choices around.
link |
00:34:04.260
So I'm big about taking responsibility for my actions.
link |
00:34:06.780
I truly am.
link |
00:34:07.620
I think it's really important you have to do that.
link |
00:34:09.540
Well, my mom, not so much.
link |
00:34:12.540
So I was talking to her, you know,
link |
00:34:14.740
and I would start saying, you know,
link |
00:34:16.300
she would start the conversation talking about,
link |
00:34:19.300
she didn't understand
link |
00:34:20.260
why Denise wouldn't speak to her anymore.
link |
00:34:22.300
That was one of her tropes.
link |
00:34:24.180
So, and my response started to become,
link |
00:34:26.020
well, because you were the abuser
link |
00:34:28.780
and you spent your life doing that to her.
link |
00:34:31.100
So it's more healthy for her not to talk to you.
link |
00:34:34.340
So she's still not able to see the flaws
link |
00:34:37.900
in her ways of the past.
link |
00:34:40.140
No, not at all.
link |
00:34:41.140
So my ultimatum to my mom was, look,
link |
00:34:44.660
when you're able to admit
link |
00:34:46.860
that you abused the people in your life,
link |
00:34:49.980
accept that responsibility
link |
00:34:51.460
and be able to discuss it with me, we'll have a talk.
link |
00:34:55.780
Other than that, I don't want to talk to you anymore.
link |
00:34:58.500
So for the first year it was, you know,
link |
00:35:00.500
calling, cussing my wife out, cussing me out,
link |
00:35:04.900
you know, I don't need you, blah, blah, blah, blah, blah.
link |
00:35:07.580
And then finally it started to taper off
link |
00:35:09.580
and she's never really contacted me after that point.
link |
00:35:12.260
And your dad is dying.
link |
00:35:18.020
What do you take from the way he's taken on death?
link |
00:35:21.140
Just saying, fuck it.
link |
00:35:22.940
You know, it's the man.
link |
00:35:25.460
And what have you learned from your dad?
link |
00:35:27.740
What do you love about your dad?
link |
00:35:30.100
He's one of these guys that, you know, like I told him,
link |
00:35:34.380
I told my dad about the abuse and everything else.
link |
00:35:37.700
And there was a point.
link |
00:35:39.060
So, you know, I told you about the elevator stuff,
link |
00:35:41.220
but before that, man, it was,
link |
00:35:44.900
it took me 40 years to talk about that,
link |
00:35:47.980
but it also took me 40 years to talk about,
link |
00:35:53.820
there was a point that my mom and dad would leave the house
link |
00:36:00.540
and I would urinate in the floor.
link |
00:36:03.780
All right.
link |
00:36:04.620
And...
link |
00:36:05.900
Is that like out of anger?
link |
00:36:09.300
No, no idea why.
link |
00:36:11.300
All right.
link |
00:36:12.140
But I would.
link |
00:36:12.980
Piss on the carpet.
link |
00:36:13.820
Carpet pissers like the Lebowski, right?
link |
00:36:18.260
It really tied the room together, dude.
link |
00:36:20.260
It really tied the room together.
link |
00:36:22.100
I was talking about that
link |
00:36:22.940
and this lady comes up to me after the presentation
link |
00:36:26.700
and she had a career previous to that
link |
00:36:29.500
where she dealt with abused kids.
link |
00:36:31.860
And she told me, she was like,
link |
00:36:32.780
Brett, she's like, it's a control mechanism.
link |
00:36:37.220
The only control you had was that.
link |
00:36:40.060
And she's like, kids do that.
link |
00:36:42.180
And I was like, so I'm not unique.
link |
00:36:43.500
She's like, no, you're not unique in that.
link |
00:36:45.660
So that, you know, this whole history of abuse,
link |
00:36:49.580
Denise dealt with it by drinking,
link |
00:36:51.780
by trying to commit suicide, things like that.
link |
00:36:55.100
And then finally she escapes.
link |
00:36:56.340
I'm the kid that didn't.
link |
00:36:57.180
And not only that, my wife pointed out to me that,
link |
00:37:00.540
again, it's that Eastern Kentucky mentality stuff.
link |
00:37:02.780
You know, the male's expected to do things.
link |
00:37:04.780
So with me, it was almost like I stepped up
link |
00:37:09.660
to take part in those crimes
link |
00:37:12.180
so that Denise didn't have to.
link |
00:37:14.580
And she was able to avoid all that.
link |
00:37:16.580
Other than that one shoplifting stuff,
link |
00:37:18.140
Denise doesn't break the law anymore.
link |
00:37:19.940
She goes off to be a, she's a good parent.
link |
00:37:22.820
She's an angry parent.
link |
00:37:24.140
She's a good parent.
link |
00:37:24.980
She's a teacher, a good citizen overall.
link |
00:37:27.700
I was just the guy that kept right on going with it.
link |
00:37:30.940
Kept on going.
link |
00:37:31.780
So let me ask you about that.
link |
00:37:32.980
So your life of cyber crime.
link |
00:37:37.300
In describing some of the things you did or knew about,
link |
00:37:40.220
you said, quote,
link |
00:37:41.700
"'I once stole several thousand dollars worth of coins
link |
00:37:44.580
"'from a family trying to sell them
link |
00:37:47.140
"'to put a new roof on their home.
link |
00:37:48.820
"'Another time, I sent a counterfeit cashier's check
link |
00:37:52.900
"'to a victim and he ended up being arrested for it.
link |
00:37:55.980
"'I lied to family, friends, everyone I knew.
link |
00:37:58.580
"'I was a truly despicable person.'"
link |
00:38:01.100
True.
link |
00:38:02.340
"'One of my Ukrainian associates script
link |
00:38:05.100
"'had someone who owed him money kidnapped and tortured.
link |
00:38:08.660
"'He posted pictures of it online.
link |
00:38:11.320
"'Another member, Iceman,
link |
00:38:13.600
"'used to flood his enemy's email addresses
link |
00:38:16.200
"'with child pornography, then called the police on them.'"
link |
00:38:19.740
That's some stories.
link |
00:38:20.820
Can you tell some of these stories that stand out to you
link |
00:38:23.900
that are particularly despicable or representative
link |
00:38:29.180
or interesting when you look back
link |
00:38:31.580
that defined your approach and who you were at that time?
link |
00:38:36.260
Let me say that I did not care about my victim, all right?
link |
00:38:41.940
I cared about me, is what I cared about.
link |
00:38:45.940
It's rough to admit that.
link |
00:38:50.140
You don't give a shit what you're doing to anybody else,
link |
00:38:51.780
you only care about you.
link |
00:38:52.820
But that's the truth of the matter.
link |
00:38:54.280
I didn't care about the victims.
link |
00:38:56.480
The lady, that wasn't even at the beginning of my career
link |
00:39:00.740
as a cyber criminal, that was right at the last of it.
link |
00:39:03.060
Which lady?
link |
00:39:03.900
The coin lady.
link |
00:39:05.900
By that point, Shadow Crew had made
link |
00:39:07.500
the front cover of Forbes, August of 04.
link |
00:39:10.580
October 26th of 04, Secret Service had shut us down,
link |
00:39:13.860
33 people arrested, six countries in six hours.
link |
00:39:16.900
I was the guy that was publicly mentioned as getting away.
link |
00:39:20.620
What happened was is I was the guy who was,
link |
00:39:23.580
I had kind of invented this crime
link |
00:39:25.700
called tax return identity theft
link |
00:39:27.860
and was stealing a lot of money.
link |
00:39:30.980
I went through all my stateside savings
link |
00:39:33.660
and Shadow Crew gets shut down.
link |
00:39:35.540
I don't have any way to come in with any money,
link |
00:39:37.820
so I start running counterfeit cashier's checks,
link |
00:39:40.940
defrauding people with that,
link |
00:39:42.380
having them send products or bullion collections,
link |
00:39:45.840
what have you, by COD, collect on delivery,
link |
00:39:48.260
and I would pay with it
link |
00:39:49.300
with a counterfeit cashier's check.
link |
00:39:51.100
This lady was on eBay.
link |
00:39:54.060
She had been collecting these silver coins all of her life.
link |
00:39:57.180
You know, the U.S. currency used to be,
link |
00:39:58.700
the coins used to be silver,
link |
00:40:00.420
so she had a whole collection of these things,
link |
00:40:02.620
like, I don't know, 80, 90 pounds of this stuff,
link |
00:40:05.580
and I'm a very good social engineer.
link |
00:40:10.420
So, convinced her that I was a legitimate person,
link |
00:40:13.780
that, you know, hey, send it to COD,
link |
00:40:16.060
you can use my FedEx account to do that
link |
00:40:18.700
or my UPS account to do that.
link |
00:40:20.580
I'll pay with a cashier's check,
link |
00:40:23.460
you can take it in, same as cash.
link |
00:40:25.740
She believed that, she was, even on the ad,
link |
00:40:28.740
and we talked on the phone and everything else,
link |
00:40:30.460
she had told me that she was a single parent,
link |
00:40:33.340
and it was the only money that she had
link |
00:40:34.940
to put a roof on the house for her and her kids,
link |
00:40:39.460
and I didn't give a damn.
link |
00:40:41.460
I didn't give a damn.
link |
00:40:42.300
What was more important was me at that point.
link |
00:40:44.420
Can I ask you a question about the social engineering aspect?
link |
00:40:46.380
So maybe specifics like the methodology,
link |
00:40:50.820
email, you said phone,
link |
00:40:52.900
maybe you could discuss this process
link |
00:40:57.980
from a bigger philosophical perspective
link |
00:41:00.300
of what is it about human beings
link |
00:41:03.540
that makes it possible to be social engineer,
link |
00:41:06.580
to be victims of fraud?
link |
00:41:09.780
So, first let me say that I became a social engineer
link |
00:41:15.020
as a child, all right, because the adults in my environment,
link |
00:41:20.020
as a child, I had to know exactly what they were thinking
link |
00:41:23.300
and be able to try to manipulate that for survival.
link |
00:41:26.340
So I became a social engineer for survival initially,
link |
00:41:30.740
all right, and one of the things that I've seen
link |
00:41:32.500
with a lot of cyber criminals is the exact same thing.
link |
00:41:35.100
They're really expert ones.
link |
00:41:37.300
They become a social engineer as a child,
link |
00:41:38.980
then later on, they use those tools to victimize others.
link |
00:41:42.940
Which is fascinating because you're,
link |
00:41:44.740
in order to understand what others are thinking,
link |
00:41:46.780
you have to be extremely good at empathy.
link |
00:41:49.020
So you have to like really put yourself
link |
00:41:51.500
in the shoes of the other person.
link |
00:41:53.300
And yet, in order to do cyber crime,
link |
00:41:56.540
you have to not care about the pain
link |
00:42:00.740
that might cause them once you manipulate them.
link |
00:42:03.100
So you have to empathize and yet not care.
link |
00:42:06.860
Exactly, and I would argue,
link |
00:42:08.420
I would argue that that is not a sociopath
link |
00:42:11.260
because a cyber criminal, and I was no different,
link |
00:42:13.500
most cyber criminals justify those actions.
link |
00:42:15.860
So the justification becomes what's important.
link |
00:42:18.540
With me, the justification was why I did it for my family,
link |
00:42:21.380
did it for my wife, did it for my stripper girlfriend.
link |
00:42:24.060
So, and I believe those justifications.
link |
00:42:25.380
That's a good story, I heard that one.
link |
00:42:26.220
Yeah, so.
link |
00:42:27.060
I like that, because I care about love a lot.
link |
00:42:28.660
Yeah, so the big picture of that is trust.
link |
00:42:35.220
How do you establish trust with a potential victim?
link |
00:42:40.220
All right, now I would argue online
link |
00:42:42.540
that that trust is established through a combination
link |
00:42:44.860
of technology, tools, social engineering.
link |
00:42:47.780
All right, so we trust our tech.
link |
00:42:50.580
We trust our cell phones, we trust our laptops.
link |
00:42:53.340
A lot of times we don't understand how they operate,
link |
00:42:55.020
but we trust the news that comes across the line.
link |
00:42:56.980
We trust the phone numbers that show up.
link |
00:42:59.420
We trust IP addresses if we're advanced enough
link |
00:43:02.340
to look at an IP address or a domain
link |
00:43:04.060
or anything else like that.
link |
00:43:05.460
Criminals use tools to manipulate that,
link |
00:43:07.580
spoof phone numbers, spoof browser fingerprints,
link |
00:43:11.500
whatever that may be, whatever the tool may be.
link |
00:43:14.060
Then that lays a base level of trust.
link |
00:43:16.540
At that point, you shoot in with the social engineering
link |
00:43:19.820
and lay whatever story that is in order to manipulate
link |
00:43:22.420
that victim to act not out of reason,
link |
00:43:25.060
but out of emotion all of a sudden.
link |
00:43:27.740
This is fascinating about the way humans interact
link |
00:43:31.540
with the world, which is you're almost too afraid
link |
00:43:34.620
to not trust the world.
link |
00:43:35.460
You have to find a balance.
link |
00:43:36.420
You have a lot of conspiracy theories now
link |
00:43:40.380
about distrusting institutions and thinking
link |
00:43:42.620
like everything around us.
link |
00:43:44.060
It's like I've been listening to people
link |
00:43:46.300
who believe the earth is flat.
link |
00:43:48.300
And that conspiracy theory is fascinating to me
link |
00:43:52.020
because it basically says that you can't trust anybody.
link |
00:43:57.740
Like everything you hear is a lie.
link |
00:44:00.460
So that's one, you can live that life
link |
00:44:03.300
or you can live a life
link |
00:44:04.340
where you're just naively trusting everything.
link |
00:44:06.820
And we as humans have to,
link |
00:44:08.220
because that life is kind of full of happiness
link |
00:44:11.660
if nobody screws you over.
link |
00:44:13.260
Cause you meet people with the joyful heart
link |
00:44:16.620
and you get excited and all that kind of stuff.
link |
00:44:18.780
But if you do that too much, you're gonna get burned.
link |
00:44:21.980
So you have to find some kind of balance
link |
00:44:23.780
in terms of optimizing happiness where you trust,
link |
00:44:28.740
I mean, but verify and on the internet
link |
00:44:32.020
that becomes really tricky.
link |
00:44:34.300
You're almost too afraid to distrust everything
link |
00:44:36.020
cause you'll never get anything done on the internet.
link |
00:44:38.820
But then if you trust too much, you can get screwed over.
link |
00:44:41.220
And so the social engineering comes in where you're like,
link |
00:44:45.100
I'm not sure if I should trust this.
link |
00:44:47.620
You kind of help them build the narrative
link |
00:44:50.620
where it's like, it's good.
link |
00:44:51.620
It's good.
link |
00:44:52.460
It's good.
link |
00:44:53.300
So in a lot of the times that social engineering
link |
00:44:55.660
is just feeding into what the victim wants to believe.
link |
00:45:00.740
All right.
link |
00:45:01.580
It's not really coming up with a brand new story at all.
link |
00:45:03.620
It's just knowing what that victim is,
link |
00:45:05.380
what the motivations of that victim is
link |
00:45:07.420
feeding into it at that point.
link |
00:45:08.940
So you have to, again,
link |
00:45:10.220
that social engineer has to almost immediately know
link |
00:45:14.060
what's driving that person that they're talking about.
link |
00:45:16.300
If I'm working on a phone,
link |
00:45:18.060
talking to someone over the phone,
link |
00:45:19.380
I have to know within seconds what I need to say,
link |
00:45:22.300
how I need to act to interact
link |
00:45:23.820
with that customer service agent
link |
00:45:25.820
or whoever I'm talking to on the other end of the line.
link |
00:45:28.100
So fascinating because you truly are empathizing
link |
00:45:31.220
with the other person.
link |
00:45:32.220
Absolutely.
link |
00:45:33.300
Who is it?
link |
00:45:34.140
This business man, Steven Schwarzman.
link |
00:45:36.580
And I've talked to a few times.
link |
00:45:40.380
He mentioned this thing that,
link |
00:45:44.020
the way you build deep relationships
link |
00:45:45.780
is you really kind of notice
link |
00:45:49.020
the things that people are telling you.
link |
00:45:51.220
Like what they want and what they're bothered by,
link |
00:45:56.140
what are their big problems in their lives?
link |
00:45:58.300
Because everybody's saying that all the time
link |
00:46:00.900
and most of us are just ignoring it.
link |
00:46:02.540
Right.
link |
00:46:03.380
But if you take the time to listen,
link |
00:46:05.420
you know somebody at that point.
link |
00:46:07.060
Yeah.
link |
00:46:07.900
Absolutely you do.
link |
00:46:08.740
Then you have to be able to dismiss it.
link |
00:46:10.820
You have to dismiss it after.
link |
00:46:12.780
You're looking for that just to see
link |
00:46:14.020
how I can manipulate that is what you're trying to do.
link |
00:46:17.020
So the lady was one story,
link |
00:46:20.340
another truly despicable story.
link |
00:46:22.020
We'll get to script in a second.
link |
00:46:23.900
But another truly despicable story.
link |
00:46:25.700
We were one of the really first groups
link |
00:46:28.900
that started phishing attacks.
link |
00:46:30.700
What's phishing?
link |
00:46:31.540
So that is a social engineering attack.
link |
00:46:33.580
PH by the way.
link |
00:46:34.580
Yeah, PH.
link |
00:46:35.420
That's another social engineering attack.
link |
00:46:36.780
That's sending that fake email out
link |
00:46:38.900
that looks like it's coming from a website
link |
00:46:40.580
or your financial organization or whatever
link |
00:46:42.380
and saying, hey, we've got a security problem.
link |
00:46:44.340
We need you to update your account information.
link |
00:46:46.980
Well, back then no one had ever seen a phishing attack.
link |
00:46:50.540
So you could ask for all the information.
link |
00:46:53.280
You were getting just complete identity profiles
link |
00:46:56.240
on a phishing email.
link |
00:46:57.380
Nowadays you can't do that.
link |
00:46:58.340
Nowadays you look for basically credentials
link |
00:47:00.160
because everyone is aware of phishing.
link |
00:47:02.020
But back then it was complete information.
link |
00:47:03.860
We had phished out, I don't know, 200,000 eTrade accounts.
link |
00:47:08.420
That's what we had the login credentials for.
link |
00:47:10.060
The login password, yeah.
link |
00:47:11.180
Login password, complete social, date of birth,
link |
00:47:13.900
mother's maiden account information, everything else.
link |
00:47:17.740
So we had access to those eTrade accounts.
link |
00:47:20.380
eTrade initially had no security in place.
link |
00:47:24.180
So you could cash out the account,
link |
00:47:26.180
ACH the money out to whatever account you wanted to,
link |
00:47:29.940
went through just fine.
link |
00:47:31.540
Made them alive on that for four to six months.
link |
00:47:34.900
eTrade got to the point where you couldn't
link |
00:47:38.380
do any ACH coming out.
link |
00:47:41.260
They locked everything down.
link |
00:47:42.780
Well, you're still sitting on thousands of eTrade accounts.
link |
00:47:46.380
How do you make money on that?
link |
00:47:50.540
That's a good question.
link |
00:47:51.580
So what you do is you find some fat cat that's
link |
00:47:53.580
got his retirement invested in blue chips.
link |
00:47:57.220
Same time you find a penny stock,
link |
00:47:59.420
you open up a brand new account, buy into that penny stock,
link |
00:48:03.060
cash the fat cat out, buy into that same penny stock,
link |
00:48:06.460
bump and dump schemes all of a sudden.
link |
00:48:08.140
So you're destroying people's retirement accounts
link |
00:48:11.020
for just a few thousand dollars.
link |
00:48:12.940
Bam, bam, bam.
link |
00:48:14.020
And of course, eTrade's response is, not our problem.
link |
00:48:17.620
It's your problem.
link |
00:48:18.500
You shouldn't give up your password
link |
00:48:19.900
or what have you at that point.
link |
00:48:21.500
And you still see that issue today with Zelle scams
link |
00:48:24.020
and things like that.
link |
00:48:25.380
Which scam?
link |
00:48:26.300
Zelle.
link |
00:48:26.940
So you know, the instant payment that they have.
link |
00:48:28.620
So it's the same kind of operation,
link |
00:48:29.900
same type of difference with different payment mechanisms.
link |
00:48:32.300
You find an easy way to exploit a system,
link |
00:48:35.460
and typically the financial organization, not our problem.
link |
00:48:39.100
Our system's secure, it's the humans, it's their errors.
link |
00:48:41.780
Well, not really.
link |
00:48:43.780
You know, you've got some culpability in that,
link |
00:48:45.940
and you're just trying to avoid paying the part of the bill
link |
00:48:49.380
is what's going on.
link |
00:48:50.220
One of the things, just to stand fishing for a bit,
link |
00:48:52.500
is it really makes me sad because there's been people
link |
00:48:57.420
on all kinds of platforms, including YouTube comments,
link |
00:49:00.660
but emails too.
link |
00:49:02.220
They figured out emails somehow.
link |
00:49:04.660
So people are now seeing the followers
link |
00:49:11.620
of this particular podcast who are fans,
link |
00:49:13.940
they're finding them on platforms like LinkedIn and YouTube
link |
00:49:18.060
and so on, and they are figuring out
link |
00:49:20.820
ways to get to those people by another channel, which
link |
00:49:24.980
I suppose seems more authentic to those people.
link |
00:49:29.620
So they send them an email from what looks like me,
link |
00:49:34.700
and with this kind of loving message.
link |
00:49:37.980
The interesting thing, the emails
link |
00:49:39.780
sound like something I would write.
link |
00:49:41.900
So these aren't even, at this stage, it's not even,
link |
00:49:44.580
it doesn't feel automated.
link |
00:49:46.180
Or if it's automated, there's a human in the loop
link |
00:49:49.900
that's really fine tuning it to a specific,
link |
00:49:52.540
or maybe I'm very predictable.
link |
00:49:53.980
But it's very loving in the way I would write that message.
link |
00:49:58.340
So think about that, all right?
link |
00:49:59.900
So when Phishing first comes out,
link |
00:50:02.100
you could look at the language of the text or the website
link |
00:50:04.740
and say, eh, if you were paying attention, that's so OK.
link |
00:50:07.940
So that's not an English speaker who wrote that, typically.
link |
00:50:11.340
But as time has went on, as the awareness of what a Phishing
link |
00:50:15.060
attack looks like, we have people
link |
00:50:17.500
that are sitting down now and making sure
link |
00:50:19.380
that the language is proper.
link |
00:50:20.740
It gets worse than that, though.
link |
00:50:22.060
If you look at business email compromise,
link |
00:50:24.260
so the way a business email compromise typically works
link |
00:50:26.820
is the attacker will find a payroll person, find a CEO.
link |
00:50:31.580
He will fashion a spear phishing email, which
link |
00:50:34.300
is that's a Phishing attack that's targeting
link |
00:50:36.700
one specific individual.
link |
00:50:38.980
So he'll fashion a spear phishing email.
link |
00:50:40.740
And the way he does that is he pulls all the information
link |
00:50:43.860
he possibly can on that person, that CEO.
link |
00:50:49.180
Maybe he'll spear that CEO just to get their login credentials
link |
00:50:55.940
to their email, just to read the emails.
link |
00:50:58.180
And he'll go in there, and he'll start
link |
00:50:59.700
reading all these emails.
link |
00:51:01.220
He'll specifically read the emails to the payroll
link |
00:51:04.340
department, see what that relationship is.
link |
00:51:06.140
Are they talking about their kids,
link |
00:51:07.580
talking about relationships, talking about vacation?
link |
00:51:09.500
What are they talking about?
link |
00:51:10.500
How are they talking?
link |
00:51:11.340
Are they friendly?
link |
00:51:12.300
Are they sterile?
link |
00:51:13.300
What are they doing, all right?
link |
00:51:15.060
So then he decides, well, I'm going to go ahead
link |
00:51:17.060
and spear phish the payroll department as well.
link |
00:51:20.020
So then he spear phishes in, gets those credentials.
link |
00:51:22.540
At the same time, he creates a Unicode domain
link |
00:51:25.700
in whatever the company name is, all right?
link |
00:51:27.740
So instead of that English alphabet I,
link |
00:51:29.780
he's got that Russian letter that looks like an I
link |
00:51:32.220
but without the dot on top, all right?
link |
00:51:35.260
Comes back into the email, into the payroll email,
link |
00:51:38.340
blocks the real CEO's email, replaces that with the Unicode
link |
00:51:42.780
email that he's got, and then sends out a message
link |
00:51:47.620
using the correct language, the correct relationships,
link |
00:51:50.340
everything else, and says, hey, we're updating
link |
00:51:52.700
our account status, I need you to send this payment
link |
00:51:55.140
instead of over here, they've set up a new account,
link |
00:51:58.100
send all payments over here now.
link |
00:51:59.860
And that is business email compromise in a nutshell,
link |
00:52:02.620
all right, works great.
link |
00:52:04.460
Probably the larger the organization,
link |
00:52:06.580
the more susceptible to that kind of attack
link |
00:52:10.140
because there's like a distribution of responsibility
link |
00:52:14.820
to where you're more likely to believe that,
link |
00:52:16.900
okay, this other person is responsible,
link |
00:52:18.980
I'm sure they secured everything.
link |
00:52:21.420
I'm okay listening to this.
link |
00:52:24.260
So that's business email compromise,
link |
00:52:25.940
and those crimes, and that's one of the things
link |
00:52:27.780
you see about cybercrime.
link |
00:52:28.820
Cybercrime's not really sophisticated.
link |
00:52:30.820
It's not, the attacks are not sophisticated.
link |
00:52:32.900
The stat is 90% of every single attack uses a known exploit.
link |
00:52:37.900
It's not zero day attacks, they're out there,
link |
00:52:41.380
but if you're a criminal waiting on a zero day to profit,
link |
00:52:43.620
you're gonna starve to death.
link |
00:52:45.420
The meat and potatoes are that 90%, known exploits.
link |
00:52:50.460
And then the rest is, well, you're saying it's,
link |
00:52:54.020
maybe you mean it's not technically sophisticated,
link |
00:52:56.820
but it's social engineering sophisticated.
link |
00:52:59.060
Very sophisticated on that end, very sophisticated.
link |
00:53:01.340
I mean, it's a fascinating study of that.
link |
00:53:03.380
That establishment of trust and then using that trust
link |
00:53:06.780
to defraud that victim.
link |
00:53:09.460
That is something.
link |
00:53:11.300
I wish, obviously, all of these folks
link |
00:53:14.380
are really good at hiding.
link |
00:53:16.740
I wish you could tell their stories in a way,
link |
00:53:19.460
which is why you're fascinating,
link |
00:53:21.020
is you're able to tell these stories now,
link |
00:53:22.820
because it is studying human nature by exploiting it,
link |
00:53:28.180
but you get to understand our weak points,
link |
00:53:30.260
our hope, our desire to trust others.
link |
00:53:35.060
Also, the weak points and the failures of digital systems
link |
00:53:42.900
and at scale, humans have to connect.
link |
00:53:46.020
It's fascinating.
link |
00:53:46.860
This is a weird question, asking for a friend.
link |
00:53:52.700
Is spear phishing itself illegal?
link |
00:53:54.860
What's the legality here?
link |
00:53:56.260
Oh, it's all illegal.
link |
00:53:57.140
Absolutely it is.
link |
00:53:58.220
Is it?
link |
00:53:59.060
Absolutely.
link |
00:53:59.900
So here's what, okay, let me construct an example.
link |
00:54:02.460
So if my friend were to spear phish like a CEO, right,
link |
00:54:10.620
and get their information and after they get control,
link |
00:54:14.560
say, of their Twitter account,
link |
00:54:16.220
they tweet something loving and positive, what's the crime?
link |
00:54:21.900
Unauthorized access of advice.
link |
00:54:23.700
What will be the punishment, do you think?
link |
00:54:27.580
That becomes questionable.
link |
00:54:29.100
So no monetary loss, or was there a monetary loss?
link |
00:54:33.020
Probably not, all right?
link |
00:54:34.740
So you have to figure out who the victim is
link |
00:54:37.140
before charges are pressed.
link |
00:54:38.200
Now, the crime would be unauthorized access, all right?
link |
00:54:42.140
But no real victim on that,
link |
00:54:45.300
unless the person whose account you took over
link |
00:54:48.260
takes exception to that.
link |
00:54:51.860
No monetary loss.
link |
00:54:53.060
So there's not really standard fines.
link |
00:54:55.140
Probably nothing's gonna happen, right.
link |
00:54:56.880
Right, right.
link |
00:54:57.720
So, I mean, that's kind of interesting,
link |
00:54:59.900
because it's, so when I got the ransomware,
link |
00:55:04.280
when I got the zero day attack on the QNAP mass,
link |
00:55:09.920
they basically say the criminal is QNAP, the company,
link |
00:55:17.580
for having so many security vulnerabilities.
link |
00:55:20.720
They're like, you are the victim of QNAP's incompetence.
link |
00:55:25.720
That's the way they kind of phrase it.
link |
00:55:27.880
And see, I don't agree with that.
link |
00:55:30.080
I don't agree with that at all.
link |
00:55:31.920
So, SolarWinds.
link |
00:55:33.760
Yeah.
link |
00:55:34.600
Let's, so I've got 130 page class action lawsuit
link |
00:55:41.200
printed out at the house, I've been going through it,
link |
00:55:43.120
that catalogs how SolarWinds lied for years
link |
00:55:47.200
about their vulnerabilities, and they lied to investors.
link |
00:55:49.760
The people who came in, the honorees who they would hire,
link |
00:55:53.720
would, you know, they would not pay attention to them
link |
00:55:57.040
when they said, you know, you've got these issues,
link |
00:55:58.600
they would say, go away, shit like that for years,
link |
00:56:01.560
until SolarWinds, you know, the attacks become apparent.
link |
00:56:07.160
My view on that is that the only person
link |
00:56:10.960
responsible for the crime are the criminals
link |
00:56:14.040
who did the attacking, the actual criminals, not SolarWinds.
link |
00:56:18.000
Now, does that mean that SolarWinds isn't all fucked up?
link |
00:56:21.400
They are, and there needs to be some accounting in place.
link |
00:56:25.560
But the only individual, the only people responsible
link |
00:56:29.400
for crime are the criminals, and that's either online,
link |
00:56:33.680
in the physical world, what have you.
link |
00:56:36.520
Being an idiot is not a crime.
link |
00:56:39.800
Not a crime.
link |
00:56:40.640
You know, being criminally negligent is,
link |
00:56:45.200
and I think that SolarWinds is certainly responsible,
link |
00:56:48.640
not responsible, they're culpable for what happened.
link |
00:56:52.240
Can you actually tell folks about SolarWinds?
link |
00:56:55.360
What is it, what are some interesting things
link |
00:56:59.600
that you're aware of?
link |
00:57:00.440
SolarWinds was very, it provided a backbone of security
link |
00:57:05.760
for hundreds, thousands of different companies.
link |
00:57:12.360
If you looked at, a lot of security companies
link |
00:57:14.440
were using SolarWinds that would allow you
link |
00:57:16.360
to get a snapshot of the entire system
link |
00:57:19.040
that they were working on.
link |
00:57:20.400
So what happens is, is you get a Russian group that comes in
link |
00:57:24.400
and they basically, they hack into SolarWinds
link |
00:57:29.560
and get access to it, and it allows them
link |
00:57:31.680
to view every single thing, I mean, every single thing
link |
00:57:37.240
about every single client that SolarWinds had at that point.
link |
00:57:42.240
So entire snapshots of all the IP that was going on,
link |
00:57:46.000
all the emails, all the communications,
link |
00:57:47.920
every single secret that was going on with those companies.
link |
00:57:50.920
If a company had software like Microsoft,
link |
00:57:53.640
it allowed them to look at the source code
link |
00:57:55.720
of everything that was going on.
link |
00:57:57.240
I mean, it's just a complete and total nightmare, all right?
link |
00:58:01.080
And something that you are not going to recover from.
link |
00:58:05.960
You're not.
link |
00:58:07.280
I mean, it's done at that point.
link |
00:58:08.960
You know, there's not been a lot of news lately about it,
link |
00:58:12.480
but the fact of the matter is, is that's the type of attack
link |
00:58:15.120
that's a catastrophic attack.
link |
00:58:16.920
So there's a huge amount of information
link |
00:58:19.840
that was read, saved elsewhere probably.
link |
00:58:22.720
Oh yeah.
link |
00:58:23.560
And so now there's people sitting on information.
link |
00:58:26.280
Absolutely.
link |
00:58:27.120
So think about one of the attack vectors
link |
00:58:28.600
has been Microsoft Outlook 365, things like that.
link |
00:58:32.800
This allowed the attackers to look
link |
00:58:34.320
at the source codes of that.
link |
00:58:36.400
So they have the source code now,
link |
00:58:39.240
so they go through it line by line.
link |
00:58:41.520
Where are the vulnerabilities?
link |
00:58:42.560
Let's find new vulnerabilities, new zero days.
link |
00:58:44.600
You know, I said zero days aren't common,
link |
00:58:46.520
but this opens up an entire new threat surface
link |
00:58:49.000
all of a sudden.
link |
00:58:50.000
So it's a completely catastrophic attack.
link |
00:58:52.480
Once all the chips are down, everything's tallied up,
link |
00:58:54.800
people are going to be like, yeah, we're done.
link |
00:58:56.760
We're done.
link |
00:58:57.600
Yeah.
link |
00:58:58.440
All right, this whole computer thing,
link |
00:59:02.800
we tried it and we're walking away.
link |
00:59:04.840
We're done.
link |
00:59:05.680
That's terrifying.
link |
00:59:07.560
So you're saying that there's not been obvious
link |
00:59:11.680
big negative impact from that yet.
link |
00:59:14.720
So, but like.
link |
00:59:15.560
There's been a lot of negative impact,
link |
00:59:16.920
but we're just starting.
link |
00:59:18.320
Right.
link |
00:59:19.160
So the capacity for destruction is huge here.
link |
00:59:22.520
How much involvement from nation states
link |
00:59:24.600
do you think there is on this?
link |
00:59:26.640
You know, it's interesting.
link |
00:59:29.000
So you've got Iran, you've got North Korea,
link |
00:59:31.680
China, Russia, you got the big four.
link |
00:59:33.240
You also got Brazil.
link |
00:59:35.440
You've got all these other countries
link |
00:59:36.680
that are interested in the United States as well.
link |
00:59:40.600
Nation states are interesting
link |
00:59:42.120
depending on who the nation state is.
link |
00:59:44.440
All right, so Russia is very good about working
link |
00:59:46.240
with the type of criminal that I used to be.
link |
00:59:48.240
You know, they'll enlist these guys
link |
00:59:49.960
and steal information or what have you,
link |
00:59:51.880
then Russia will take the information they want to,
link |
00:59:54.080
and they'll basically go off and sell whatever you want to
link |
00:59:56.640
and make some money.
link |
00:59:58.280
China's all about IP.
link |
01:00:01.160
North Korea is about stealing money
link |
01:00:02.480
because they really don't know
link |
01:00:03.320
what the hell else to do right now, but...
link |
01:00:07.200
So North Korea is actively involved in cybercrime.
link |
01:00:09.480
Absolutely.
link |
01:00:10.360
They've stolen a shitload of Bitcoin, everything else.
link |
01:00:13.320
So absolutely, they're actively involved with that.
link |
01:00:16.640
Very, very skilled attackers, very skilled.
link |
01:00:19.120
But even if you look at, you know,
link |
01:00:20.160
I told you that stat about 90%, all right?
link |
01:00:23.560
So even though SolarWinds is going to be
link |
01:00:27.920
the number one attack,
link |
01:00:29.320
the followup to that is this NotPetya attack that happened.
link |
01:00:33.040
And so that was the most sophisticated attack
link |
01:00:35.680
launched by the Russian Sandworm Group
link |
01:00:38.200
using all known exploits throughout.
link |
01:00:40.920
So it's not, again, it's not...
link |
01:00:43.920
You're right in the sophistication
link |
01:00:45.320
is typically not technical sophistication,
link |
01:00:47.880
but it's a social engineering sophistication.
link |
01:00:50.120
How do you get these things put together
link |
01:00:52.200
in line to attack and succeed?
link |
01:00:55.360
But when you get access to the source code,
link |
01:00:57.320
that's where technical sophistication could really do
link |
01:00:59.560
a lot of damage.
link |
01:01:00.400
And that's when you find out real quick,
link |
01:01:02.760
that's what separates the men from the boys in this game.
link |
01:01:05.440
All right, because all of a sudden it's not,
link |
01:01:07.160
I don't have to worry about social engineering.
link |
01:01:09.000
I've got source codes and I've got professionals
link |
01:01:11.800
that are looking at that.
link |
01:01:13.280
And that's your ass.
link |
01:01:15.520
Which then enables probably even more powerful
link |
01:01:18.320
social engineering methods too.
link |
01:01:20.200
I mean, it's just the cascade of...
link |
01:01:24.560
Is this terrifying to you, by the way?
link |
01:01:26.480
That this world that we're living in,
link |
01:01:29.760
as we put more and more of ourselves on the internet,
link |
01:01:34.760
into the metaverse, that there's so many more
link |
01:01:38.720
attack vectors on our wellbeing?
link |
01:01:40.680
What's terrifying to me, I used to preach it on Shadow Crew,
link |
01:01:45.240
is the idea that the perception of truth
link |
01:01:49.640
is more important than the truth itself.
link |
01:01:52.320
It doesn't matter what the facts are,
link |
01:01:53.920
it matters what I can convince you of.
link |
01:01:56.640
That's what's terrifying to me.
link |
01:01:58.680
So you look at deep fakes, you look at fake news,
link |
01:02:02.000
all this stuff that's going out,
link |
01:02:03.760
that becomes truly terrifying.
link |
01:02:09.320
Maybe there's an angle where it's freeing,
link |
01:02:11.960
if nothing is true and you can't trust anything.
link |
01:02:15.720
But you see, we as human beings, we wanna trust.
link |
01:02:20.640
We do, we need human interaction.
link |
01:02:22.800
And for that human interaction,
link |
01:02:24.920
you have to have a degree of trust.
link |
01:02:27.000
But it's more like you let go of an idea of absolute truth
link |
01:02:31.920
and it more becomes like a blockchain style consensus.
link |
01:02:35.720
So you let go of like, you know what?
link |
01:02:39.600
There's this human dream, you get this on the internet,
link |
01:02:42.760
you get like facts, as if there's at the bottom,
link |
01:02:47.080
at the bottom, there's one turtle that's holding
link |
01:02:49.400
this scroll that says, these are the truths of the world.
link |
01:02:54.040
The problem is, I mean, maybe believing
link |
01:02:57.360
that is counterproductive.
link |
01:02:59.040
Maybe human civilization is an ongoing process of consensus.
link |
01:03:04.640
And so it's always going to be, everything is shrouded
link |
01:03:08.320
and you can call them lies or you can call them inaccuracies
link |
01:03:11.000
or you can call them delusions.
link |
01:03:13.720
It's constantly going to be, it's going to be a sea of lies
link |
01:03:16.680
and delusions, but our hope is to over time
link |
01:03:22.080
develop bigger and bigger islands of consensus
link |
01:03:24.520
that allows us to live a stable and happy society.
link |
01:03:27.520
Don't call it true, call it a stable consensus
link |
01:03:32.880
that creates a high quality of life
link |
01:03:34.880
for the inhabitants of the island.
link |
01:03:36.800
I like it, I mean, I like it.
link |
01:03:38.400
I mean, we're going to agree on this.
link |
01:03:40.240
And then don't use outlook, no, I'm just kidding.
link |
01:03:43.080
So maybe a step back, you mentioned, I'd love to talk
link |
01:03:47.840
about ShadowCrew, maybe this is the right time
link |
01:03:49.400
to actually, yeah, let's go to ShadowCrew
link |
01:03:51.440
because it's such a fascinating story.
link |
01:03:53.040
So tell me the story of building ShadowCrew,
link |
01:03:54.680
the precursor to today's darknet and darknet markets.
link |
01:03:59.800
This is why you're the original Godfather.
link |
01:04:02.960
This is it, this is it.
link |
01:04:04.600
So I get married.
link |
01:04:06.640
I faked a car accident to get married,
link |
01:04:09.120
got the money from that.
link |
01:04:10.160
You're romantic.
link |
01:04:11.120
I remember, like my dad, man.
link |
01:04:13.320
I'm the guy that, you know, I get from mom,
link |
01:04:15.000
I get the criminal mindset.
link |
01:04:16.720
From dad, I get that, don't want him to leave.
link |
01:04:19.600
So, you know, so.
link |
01:04:22.480
To get married, what's that story?
link |
01:04:26.520
Oh, dude, I was.
link |
01:04:28.160
How did you fall in love there?
link |
01:04:29.680
My first girlfriend was a preacher's daughter
link |
01:04:32.120
and crazy over her, dated her for five years.
link |
01:04:35.280
And she figured out pretty quickly that,
link |
01:04:38.680
well, not quickly, it took her five years
link |
01:04:40.360
to figure out that Brett Johnson is not the man of God.
link |
01:04:44.760
I could talk it, but more that agnostic than anything,
link |
01:04:50.600
she breaks up with me.
link |
01:04:52.320
So I was at the community college.
link |
01:04:54.880
You'd make one hell of a preacher by the way.
link |
01:04:56.840
Thank you.
link |
01:04:57.360
Let's put that.
link |
01:04:59.680
Yeah.
link |
01:05:02.360
I've got that Langston Hughes problem.
link |
01:05:04.080
I'm looking for Jesus to show up and he just doesn't.
link |
01:05:08.920
So I was at the community college
link |
01:05:10.520
and I was a straight asshole.
link |
01:05:12.040
I was arrogant, conceited, everything else.
link |
01:05:14.480
And I had posted an advertisement
link |
01:05:17.520
on one of the billboards looking for an adult babysitter,
link |
01:05:20.440
hot blonde, you know, come visit me in the library.
link |
01:05:24.040
Buddy of mine shows up and he's like, Brett.
link |
01:05:26.240
And I was like, yeah.
link |
01:05:27.520
He's like, hottest girl in school, right down the hall.
link |
01:05:29.920
And I was like, serious?
link |
01:05:30.960
He's like, yeah.
link |
01:05:31.680
And I was like, let's go see.
link |
01:05:34.240
Walk over and there's these two guys that are hitting on her.
link |
01:05:37.360
So I just walk up and me and Todd, that was my buddy,
link |
01:05:40.840
walk up and I'm just sitting there and listening.
link |
01:05:43.360
And they're giving the spill and everything.
link |
01:05:45.280
And she's just kind of taking it in.
link |
01:05:46.680
Finally, I looked over and I was like,
link |
01:05:48.880
you want to get out of here?
link |
01:05:50.560
And one of the guys looks at me and he's like, hey,
link |
01:05:53.560
we're talking to you.
link |
01:05:54.080
And I was like, well, you're talking at her.
link |
01:05:55.840
You're not talking to her.
link |
01:05:57.080
I'm about to save her ass from you.
link |
01:05:59.320
Yeah, that's a smooth pick up line, by the way.
link |
01:06:01.320
If I ever heard one, that's good.
link |
01:06:02.720
You want to get out of here?
link |
01:06:04.160
So start dating, and she was the girl
link |
01:06:08.520
that screwed my brains out.
link |
01:06:10.960
And I fell head over heels.
link |
01:06:13.120
We got married six months later.
link |
01:06:15.120
Six months.
link |
01:06:16.000
That's what love does.
link |
01:06:17.040
That's what it does.
link |
01:06:18.240
And she didn't know I was a crook.
link |
01:06:22.800
She had no idea.
link |
01:06:24.480
She knew I was very bright.
link |
01:06:26.240
She knew I did a lot of theater, stuff like that.
link |
01:06:30.480
Got a job at, I was in hazard.
link |
01:06:32.760
There was no jobs to be had, so I got a job in Lexington,
link |
01:06:35.760
because we were going to be moving to the UK.
link |
01:06:38.480
Got a job in Lexington at Lexmark testing printer boards,
link |
01:06:43.240
circuit boards.
link |
01:06:44.480
So I would leave on a Thursday night,
link |
01:06:46.920
work three 18 hour shifts at Lexmark,
link |
01:06:50.480
come back home on Monday.
link |
01:06:54.120
Got married, faked a car accident
link |
01:06:56.000
to get the rest of the money that I needed to get married.
link |
01:07:02.160
And the faking on that, man, I had bought a Chevy Spectrum
link |
01:07:07.240
at a car auction.
link |
01:07:08.080
Gave like $500 for it.
link |
01:07:09.840
My aunt had previously defrauded USAA insurance
link |
01:07:14.040
on a car accident, and she was telling me all about it.
link |
01:07:16.360
She's like, look, go down to this chiropractor.
link |
01:07:18.440
Make sure you get the insurance where
link |
01:07:19.940
they'll pay for a rental car.
link |
01:07:21.320
They'll pay lost wages.
link |
01:07:22.480
I was like, they pay lost wages?
link |
01:07:24.160
She's like, yeah, they pay lost wages.
link |
01:07:25.760
I was like, hmm.
link |
01:07:26.960
She's like, by the way, you work for me.
link |
01:07:29.120
And I was like, I work for you.
link |
01:07:32.000
And you get to define the wage.
link |
01:07:34.400
And you could also define how long you were unable to work.
link |
01:07:37.120
Exactly.
link |
01:07:37.760
Exactly.
link |
01:07:38.360
And the chiropractor will sign off on any damn thing.
link |
01:07:40.760
So my cousin, Ronnie, he figures out that I'm going.
link |
01:07:45.720
He finds out I'm going to fake this car accident.
link |
01:07:47.840
So he comes to me.
link |
01:07:48.360
He's like, hey, man, can I get in on that?
link |
01:07:49.680
I was like, yeah, man, you get on that.
link |
01:07:51.440
So this kid, he's five days younger than I am.
link |
01:07:53.960
This kid, he goes to the dentist the day
link |
01:07:55.760
that we're faking it, has a tooth pulled,
link |
01:07:58.200
tells the dentist not to numb it, not to stitch it,
link |
01:08:01.040
just pull it.
link |
01:08:02.320
So he shows up.
link |
01:08:04.560
He shows up the day that we're driving out
link |
01:08:06.360
to fake the accident.
link |
01:08:07.120
He's got blood all over his shirt.
link |
01:08:08.360
He's still bleeding out of the mouth and everything else.
link |
01:08:09.960
I'm like, are you OK?
link |
01:08:10.760
He's like, yeah, man, it's going to be good.
link |
01:08:12.160
It's going to be good.
link |
01:08:12.960
I'm like, OK.
link |
01:08:14.680
My mom, by this point, I'm living with my grandparents.
link |
01:08:17.240
My mom is up in the head of a hollow.
link |
01:08:20.280
So we're like, we'll just do it up there.
link |
01:08:22.040
We'll go act like we're visiting my mom on the way back out,
link |
01:08:25.080
ran over a mountain.
link |
01:08:26.480
OK.
link |
01:08:27.240
So we go visit and everything, come back out that night,
link |
01:08:30.640
run over the side of the hill.
link |
01:08:32.360
Me and Ronnie walk back up.
link |
01:08:33.840
Of course, it totals the car.
link |
01:08:35.840
Walk back to my mom's, acting like we've wrecked.
link |
01:08:37.960
She knows what time it is and everything else.
link |
01:08:40.000
And file the claims.
link |
01:08:41.800
So that gets the money to get married.
link |
01:08:44.400
And me and my wife moved from Hazard to Lexington.
link |
01:08:49.080
And I'm the kid that my crime, usually, if I was a single guy,
link |
01:08:57.640
wouldn't break the law.
link |
01:08:58.960
Wouldn't.
link |
01:08:59.440
I would be all right.
link |
01:09:00.520
But females involved, oh, yeah.
link |
01:09:03.280
Oh, yeah.
link |
01:09:03.760
Got to spend the money.
link |
01:09:04.640
Got to show them gifts.
link |
01:09:05.640
Everything else was never enough to show love
link |
01:09:07.840
in some sort of healthy way.
link |
01:09:09.280
Always had to go overboard.
link |
01:09:10.480
And typically, it was buying or stealing
link |
01:09:12.240
some sort of expensive crap.
link |
01:09:13.440
So that was the thing.
link |
01:09:15.200
That was the way you show love is by buying expensive gifts.
link |
01:09:19.120
Or something overboard.
link |
01:09:20.680
Back then, with Susan, initially, it was,
link |
01:09:24.360
don't worry about working.
link |
01:09:25.520
I got it.
link |
01:09:26.480
You just worry about going to school.
link |
01:09:27.980
She was a music major.
link |
01:09:29.480
I was like, you just worry about going to school.
link |
01:09:31.560
So don't worry about cooking and cleaning.
link |
01:09:34.040
I got it.
link |
01:09:34.560
I got it.
link |
01:09:35.360
So not only was I this guy that was going overboard,
link |
01:09:37.800
but I was kind of a control freak, too.
link |
01:09:40.200
So no, I got it.
link |
01:09:41.000
I got it.
link |
01:09:41.480
I got it.
link |
01:09:42.240
So here I am, 60 hour a week job, 18 hour class load,
link |
01:09:47.760
cooking and cleaning.
link |
01:09:48.760
Something had to give.
link |
01:09:50.320
I quit the job.
link |
01:09:51.200
I couldn't do it.
link |
01:09:51.880
Quit the job and start back in fraud.
link |
01:09:55.080
And trying to hide that from her at the same time.
link |
01:09:57.960
So it was initially telemarketing fraud.
link |
01:10:03.720
The first job I had was a telemarketer at a cemetery,
link |
01:10:07.240
selling gravesites.
link |
01:10:08.760
And then that ended.
link |
01:10:11.320
Went over to work for the Shriners Circus, Shriners
link |
01:10:13.640
Hospital.
link |
01:10:14.280
And it was a third party company that
link |
01:10:16.440
was doing all the telemarketing.
link |
01:10:17.780
Made really good money doing that.
link |
01:10:19.680
That job ended.
link |
01:10:21.420
And then they pivoted over to working with Kiwanis Clubs,
link |
01:10:25.120
selling food baskets to the food banks and everything.
link |
01:10:29.280
So I stole the phone list and started at my own Kiwanis Club
link |
01:10:34.880
and would do the telemarketing, go out twice a week
link |
01:10:38.000
and pick up checks.
link |
01:10:39.440
Well, what happened was is I'm going out picking up checks,
link |
01:10:44.920
go knock on a door.
link |
01:10:46.200
Turns out one of the persons that I had called
link |
01:10:48.440
was a law enforcement officer.
link |
01:10:50.800
So he was like, who are you?
link |
01:10:54.000
I'm with the Kiwanis Club.
link |
01:10:55.360
And he's like, no, you're not.
link |
01:10:57.320
So got arrested, spent three months in a county jail
link |
01:11:00.880
for theft by deception.
link |
01:11:03.080
Got out.
link |
01:11:04.240
And we had to move from Lexington back to Hazard
link |
01:11:09.120
and live with Susan's parents.
link |
01:11:10.920
They had gotten a desktop computer, HP.
link |
01:11:15.080
And I started surfing around online.
link |
01:11:18.640
Found eBay.
link |
01:11:19.880
And didn't really know how to make money on eBay.
link |
01:11:22.800
At about the same time, I'm committing low level frauds
link |
01:11:28.200
online.
link |
01:11:29.000
And I don't really talk about that in the past.
link |
01:11:30.960
The first time I've really talked about that.
link |
01:11:32.920
But I would pay for it with bad checks.
link |
01:11:37.560
So more person, so not using a platform like eBay and more.
link |
01:11:41.160
I would find somebody that had like a stereo system on eBay,
link |
01:11:44.080
something like that.
link |
01:11:44.920
And I'd pay for it with a bad check
link |
01:11:46.800
and would rely on them not to chase me
link |
01:11:49.880
because they were out of state at that point.
link |
01:11:51.680
And the dollar amounts were very low.
link |
01:11:53.960
So got the money to move to finally
link |
01:11:56.480
did those schemes enough to get the money
link |
01:11:58.800
to move back to Lexington.
link |
01:12:01.760
Got to Lexington.
link |
01:12:02.760
And by this point, I'm doing, like I said,
link |
01:12:04.880
these schemes on eBay.
link |
01:12:07.200
And I'm like, there's got to be a better way
link |
01:12:09.160
to make money on eBay.
link |
01:12:10.200
Got to be.
link |
01:12:11.000
So didn't really know how.
link |
01:12:13.560
One night, I'm watching Inside Edition with Bill Riley.
link |
01:12:16.520
And they're profiling Beanie Babies.
link |
01:12:18.400
So I'm sitting there watching.
link |
01:12:19.760
The one they're profiling is this one called Peanut,
link |
01:12:21.960
the Royal Blue Elephant.
link |
01:12:23.520
Selling for $1,500 on eBay.
link |
01:12:25.680
I'm sitting there going like, shit,
link |
01:12:27.200
I need to find me a peanut.
link |
01:12:30.440
My initial thought was, well, there's
link |
01:12:32.000
got to be one in one of these Hallmark stores
link |
01:12:33.880
in Kentucky someplace.
link |
01:12:35.440
So I skip class the next day.
link |
01:12:36.880
Went out around all the Hallmark stores looking for peanut.
link |
01:12:39.640
No, idiot.
link |
01:12:40.880
He's on eBay for $1,500.
link |
01:12:43.720
So after a few hours of that, I'm like, hmm.
link |
01:12:49.280
Turns out they had a little gray Beanie Baby elephants
link |
01:12:51.440
for $8.
link |
01:12:52.760
Picked up one of those for $8.
link |
01:12:54.440
Stopped by Kroger on the way home.
link |
01:12:56.040
Picked up a pack of Blue Rit dye.
link |
01:12:58.320
Went home, tried to dye the little guy.
link |
01:13:00.440
So that was a nightmare.
link |
01:13:02.560
Turns out they're made out of polyester.
link |
01:13:04.680
Get them out of the bath.
link |
01:13:05.760
Looks like they've got the mange.
link |
01:13:08.480
And what happens is, so I'm trying to dye the damn thing.
link |
01:13:11.680
I'm like, well, that's not going to work.
link |
01:13:13.280
That's just not going to work.
link |
01:13:14.680
So I got online, found a picture of a real one,
link |
01:13:17.320
posted it on eBay, and I was like, well, what I can do
link |
01:13:20.800
is I can claim that's the one I've got
link |
01:13:25.520
and then maybe claim that it got messed up in the mail
link |
01:13:28.400
and work out like that.
link |
01:13:29.400
So posted a picture of a real one online.
link |
01:13:32.080
Woman thought I had the real thing.
link |
01:13:33.640
She wins the bid.
link |
01:13:35.600
That social engineering kicks in immediately.
link |
01:13:37.480
I didn't want to be on the defensive.
link |
01:13:39.480
I wanted to put her on the defensive.
link |
01:13:41.360
So as soon as she wins the bid, I send her a message.
link |
01:13:44.000
Hey, we've not done any business before.
link |
01:13:46.160
I don't even know if I can trust you.
link |
01:13:47.760
What I need you to do, protects us both.
link |
01:13:50.640
Go down the US Postal Service.
link |
01:13:52.240
Get two money orders totaling $1,500.
link |
01:13:54.960
Send them to me issued by the US government.
link |
01:13:57.520
That way we're both protected.
link |
01:14:00.040
Soon as I get the money orders, I'll send you your animal.
link |
01:14:02.560
She believed that.
link |
01:14:03.320
Didn't ask any questions at all.
link |
01:14:04.680
She believed that.
link |
01:14:07.000
Sent me the money orders.
link |
01:14:07.960
I cashed them out.
link |
01:14:09.640
Sent her the creature.
link |
01:14:10.960
Immediately got a phone call.
link |
01:14:12.640
I didn't order this.
link |
01:14:13.840
My response, lady, you ordered a blue elephant.
link |
01:14:16.840
I sent you a blue fish elephant.
link |
01:14:19.840
And she got pissed.
link |
01:14:21.880
And she kept calling.
link |
01:14:23.920
What I found out, and that's really
link |
01:14:25.440
the first lesson of cybercrime that most of these criminals,
link |
01:14:27.800
including self, learns.
link |
01:14:29.160
If you delay a victim long enough,
link |
01:14:30.680
just keep putting them off.
link |
01:14:31.960
A lot of them, they get exasperated,
link |
01:14:33.720
throw their hands in the air, walk away.
link |
01:14:35.520
You don't hear from them.
link |
01:14:36.720
And none of them, to this day, none of them
link |
01:14:40.200
complain to law enforcement.
link |
01:14:41.480
They eat it.
link |
01:14:42.800
So it's a mixture of you're exhausted by the process,
link |
01:14:47.400
so it's just easier to walk away,
link |
01:14:49.520
and second, almost like an embarrassment.
link |
01:14:52.160
So there's a whole slew of reasons, all right?
link |
01:14:54.880
There's the exhaustion, certainly.
link |
01:14:56.760
There's the embarrassment.
link |
01:14:57.880
So if you figure out, if you look at it today,
link |
01:14:59.680
where does the embarrassment come from?
link |
01:15:00.960
Well, the media, family members,
link |
01:15:03.560
we're all very good about blaming the victim for crimes.
link |
01:15:06.520
Why would you click on the link?
link |
01:15:07.600
Why would you send money to somebody you don't know?
link |
01:15:09.280
Blah, blah, blah.
link |
01:15:10.240
So you've got that that's going on.
link |
01:15:12.240
You've got the issue of, who do you complain to?
link |
01:15:15.720
Back then, you didn't know.
link |
01:15:16.960
Do you complain to local police?
link |
01:15:18.160
Because she's in another state, so which local police
link |
01:15:21.240
do you complain to?
link |
01:15:22.440
Do you complain to the feds?
link |
01:15:23.600
Well, the dollar amounts aren't high enough
link |
01:15:25.400
to complain to feds.
link |
01:15:26.440
Feds are going to tell you to go local.
link |
01:15:28.200
Local's going to tell you, hey, it happened in Kentucky.
link |
01:15:30.720
Complain to them.
link |
01:15:31.600
Kentucky's going to tell you, well, shit, you're over there.
link |
01:15:34.080
We need you to come in.
link |
01:15:35.000
So there's this whole issue of the jurisdiction,
link |
01:15:38.320
of the blame factor, everything else.
link |
01:15:41.480
So I got away with that crime and did it under my own name
link |
01:15:45.240
at that point.
link |
01:15:46.920
I kept going and got better at it,
link |
01:15:49.360
started to understand how to hide identities,
link |
01:15:51.760
things like that.
link |
01:15:52.480
Started selling pirated software.
link |
01:15:54.720
Pirated software led into installing mod chips.
link |
01:15:58.080
The initial pirated software was Sega Saturn, PlayStation 1.
link |
01:16:02.040
Well, you had to have a mod chip in those
link |
01:16:03.760
to play the pirated disk, so I started
link |
01:16:06.480
selling and installing mod chips.
link |
01:16:08.760
That led into installing mod chips in the cable television
link |
01:16:11.680
boxes so you could watch all the pay per view, which in turn
link |
01:16:15.200
led into programming satellite DSS cards.
link |
01:16:18.160
Those 18 inch RCA satellite systems,
link |
01:16:20.880
pull the card out of it, program it, turns on all the channels.
link |
01:16:24.600
Started doing that.
link |
01:16:26.080
Can we just pause?
link |
01:16:28.400
That is very entrepreneurial.
link |
01:16:33.800
So just technically, so there's laws and rules
link |
01:16:41.160
that you're breaking nonstop.
link |
01:16:43.320
So there's also legitimate ways of doing
link |
01:16:46.920
that, which is break the rules of the conventions of the past.
link |
01:16:49.880
That's the first principles thing.
link |
01:16:51.360
That's what Elon Musk and his ilk do all the time.
link |
01:16:55.400
That is guts and brilliance.
link |
01:16:59.520
But when it's crossing the lines of the law,
link |
01:17:03.080
actually sometimes the law is outdated.
link |
01:17:07.240
The thing is, as a human being, you
link |
01:17:09.080
have to then compute the ethical damage you're doing.
link |
01:17:12.720
Like ethically, the damage you're
link |
01:17:14.000
doing about other human beings, that is fundamentally
link |
01:17:16.720
the thing that you're breaking, is you're
link |
01:17:19.040
adding to the suffering in the world in one way or another,
link |
01:17:22.720
and you're justifying it.
link |
01:17:24.160
But in terms of me sort of as an engineer,
link |
01:17:27.800
that is some gutsy thinking.
link |
01:17:29.440
That's how Woz and Steve Jobs thought.
link |
01:17:34.360
That's innovation.
link |
01:17:35.680
And maybe just think, if you can introspect your thinking
link |
01:17:40.880
process here, this is a new, I like
link |
01:17:44.720
how you remember this in HP, this
link |
01:17:48.800
is a totally new thing to you.
link |
01:17:50.160
Computers is another domain.
link |
01:17:53.640
How were you figuring these puzzles out,
link |
01:17:56.040
presumably mostly alone?
link |
01:17:58.320
Alone.
link |
01:17:58.960
When you were thinking through these problems, is there,
link |
01:18:03.160
this is a strange question to ask,
link |
01:18:04.720
but what is your thinking process?
link |
01:18:08.640
What is your approach to solving these problems?
link |
01:18:10.800
So the approach is you do something, and you fuck it up,
link |
01:18:15.680
and you're like, you think back, OK, how do I fix that?
link |
01:18:20.160
You fix that aspect, you commit the crime again.
link |
01:18:23.880
And it goes a little bit further, and it screws up.
link |
01:18:26.720
OK, how do I fix that?
link |
01:18:28.640
What's the issue on that?
link |
01:18:29.640
How do I fix that?
link |
01:18:30.440
So there's not a deep design thinking like that?
link |
01:18:32.880
Later on, it becomes that.
link |
01:18:33.960
Once you lay that groundwork of the way
link |
01:18:36.800
these schemes are working, it becomes that.
link |
01:18:39.160
And you can apply that to other things in cybercrime
link |
01:18:42.920
as a whole.
link |
01:18:44.480
But initially, it's basically trial and error.
link |
01:18:47.640
You've got a problem, how do you solve that problem?
link |
01:18:50.880
So I'm committing these crimes under my name,
link |
01:18:54.400
how do I solve that?
link |
01:18:56.360
Well, one of the first principles
link |
01:18:57.920
that we started to teach on Shadow Crew
link |
01:18:59.680
is all crime should begin with identity theft.
link |
01:19:03.920
That's one of the main first principles
link |
01:19:05.680
that a lot of people to this day still don't really get.
link |
01:19:08.160
All right, why would I commit a crime under my name
link |
01:19:10.240
if I can do it under your name?
link |
01:19:12.080
So that's one of the big buffers.
link |
01:19:13.840
And that takes trial and error to get
link |
01:19:15.440
to that point where you start to understand
link |
01:19:17.480
that's the way crime should operate if you're a criminal.
link |
01:19:20.960
But with me, it's trial and error.
link |
01:19:25.000
It's that childhood where that mindset
link |
01:19:28.160
is kind of ingrained in you where you're looking
link |
01:19:31.360
for ways, let's say nontraditional ways
link |
01:19:35.160
of getting around things or getting through things.
link |
01:19:37.840
I mean, one of the questions I'll probably ask this later
link |
01:19:41.160
is there's also a unique aspect to the outcome
link |
01:19:44.480
of what you were doing, which is you weren't,
link |
01:19:47.440
you didn't get caught for a very long time.
link |
01:19:50.480
We'll talk about why that is.
link |
01:19:52.000
And the thing is, it's so interesting,
link |
01:19:54.000
all crime probably should, to be effective,
link |
01:19:59.200
should start with identity theft.
link |
01:20:01.360
I like that identity theft
link |
01:20:02.760
because identity theft can take so many forms.
link |
01:20:05.240
Right, right.
link |
01:20:06.880
So yes, so Shadow Crew.
link |
01:20:09.160
So what's, so as we're, you started with love.
link |
01:20:13.240
Started with love.
link |
01:20:14.080
So now we're doing these schemes online.
link |
01:20:18.360
I'm selling to these,
link |
01:20:20.240
I'm programming these satellite DSS cards.
link |
01:20:22.000
And one of the interesting things,
link |
01:20:24.160
and you still see that to this day,
link |
01:20:26.000
is something will happen
link |
01:20:29.080
that will create an industry for criminals, all right?
link |
01:20:33.440
So what happened is Canada, Canadian judge,
link |
01:20:37.400
rules about the same time
link |
01:20:38.440
that I'm doing these satellite cards,
link |
01:20:40.560
Canadian judge comes out and says,
link |
01:20:41.920
hey, it's legal for my citizens to pirate those signals.
link |
01:20:47.560
And his reasoning was is since RCA
link |
01:20:49.960
doesn't sell the systems up here,
link |
01:20:51.480
my citizens can pirate it.
link |
01:20:53.920
Okay, so what happens is is overnight,
link |
01:20:57.440
about the same time PayPal comes into play.
link |
01:20:59.680
So PayPal is coming right online at about the same time.
link |
01:21:03.280
Overnight, a little cottage industry
link |
01:21:05.400
pops up in the United States.
link |
01:21:07.240
You go down to Best Buy, buy the system for $100,
link |
01:21:09.400
take it out in the parking lot, open system up,
link |
01:21:11.360
pull it, open box up, pull the system out,
link |
01:21:13.000
pull the card out, throw the system away,
link |
01:21:14.640
program the card, ship its ass to Canada, $500 a pop.
link |
01:21:17.840
Started doing that.
link |
01:21:19.920
Business is good.
link |
01:21:21.520
Making, you know, $3,000, $4,000 a week doing that.
link |
01:21:23.760
I'm like, yeah, that's good.
link |
01:21:26.040
I have so many orders, I can't fill all the orders
link |
01:21:29.000
and quickly think to myself,
link |
01:21:31.920
why do I need to fill any of them?
link |
01:21:33.720
They're in Canada.
link |
01:21:34.960
I'm down here.
link |
01:21:37.160
You know, who are they gonna complain to?
link |
01:21:39.160
Because I already found out people don't complain, all right?
link |
01:21:42.960
They're not gonna complain to anybody.
link |
01:21:45.160
So I start not.
link |
01:21:46.120
Especially in Canada.
link |
01:21:46.960
Especially in Canada.
link |
01:21:47.960
And I'm having them send money.
link |
01:21:50.560
That's when PayPal's first into play.
link |
01:21:53.000
And it amazes me that everybody is using PayPal.
link |
01:21:58.000
It's like, you don't even have to really ask.
link |
01:22:00.360
They're like, can we pay by,
link |
01:22:01.400
yeah, you can pay all day long by PayPal.
link |
01:22:03.240
And PayPal had no clue what they were doing with security.
link |
01:22:05.840
So it's like, okay.
link |
01:22:08.280
So they're sending money to PayPal.
link |
01:22:09.800
I'm having the PayPal cashed out to bank accounts
link |
01:22:13.280
in my name at that point.
link |
01:22:15.520
And I get scared because by that point,
link |
01:22:17.400
I'm still in four to $6,000 a week.
link |
01:22:20.080
And I'm like, somebody's gonna be looking at money laundering.
link |
01:22:23.440
So get it in my head.
link |
01:22:24.920
I'm like, best thing that I can do
link |
01:22:27.160
is get a fake driver's license,
link |
01:22:28.880
open up a bank account using that driver's license,
link |
01:22:31.120
cash out at the ATM.
link |
01:22:33.240
Good.
link |
01:22:34.080
No idea where to get a fake ID.
link |
01:22:35.400
Not a clue.
link |
01:22:36.480
So I get online, looked around.
link |
01:22:38.640
Spent a couple of weeks looking around.
link |
01:22:40.280
Thought I found a guy.
link |
01:22:41.480
He went by the screen name of Fake ID Man.
link |
01:22:43.840
Thought I found a guy, sent him $200, sent him my picture.
link |
01:22:46.920
Dude rips me off.
link |
01:22:48.120
And I'm like, what the hell, man?
link |
01:22:52.720
Oh, I got played.
link |
01:22:53.560
He had a little website set up with reviews.
link |
01:22:57.200
And I'm like, oh, it's all legitimate.
link |
01:22:58.720
He's building that trust that I talked about.
link |
01:23:01.080
So the end result, I got pissed.
link |
01:23:05.400
And there was no site that dealt with anything
link |
01:23:10.400
criminal or cyber crime related.
link |
01:23:14.000
The only real avenue you had was an IRC chat session,
link |
01:23:17.040
internet relay chat.
link |
01:23:18.520
And that, I'm sure you've been on that.
link |
01:23:20.760
It's this rolling chat board.
link |
01:23:22.800
You don't know who the hell you're talking to.
link |
01:23:24.680
Most of them are full of shit.
link |
01:23:26.000
You can't trust anybody.
link |
01:23:27.280
And you're sitting there trying to conduct business.
link |
01:23:29.440
So if somebody claims they've got a product or service,
link |
01:23:32.200
do they have it?
link |
01:23:33.040
Does it work?
link |
01:23:33.880
Are they just gonna rip you off?
link |
01:23:34.700
Because in those channels, everyone's a criminal.
link |
01:23:37.000
I kept looking around and I've happened upon a website
link |
01:23:42.960
called Counterfeit Library.
link |
01:23:44.600
And Counterfeit Library only dealt with counterfeit degrees
link |
01:23:48.160
and certificates, degree mail type stuff.
link |
01:23:51.720
But they had a forum and no one was using the forum.
link |
01:23:55.320
So I basically get on there and bitch every day.
link |
01:23:58.360
I got ripped off, don't know what to do,
link |
01:24:00.360
bam, bam, bam, bam, bam.
link |
01:24:01.600
About the same time I started doing that,
link |
01:24:03.320
two other guys show up.
link |
01:24:04.840
One's named Mr. X, he's out of Los Angeles.
link |
01:24:07.360
Other guy's named Beelzebub,
link |
01:24:08.720
he's out of Moose Jaw, Saskatchewan.
link |
01:24:11.760
And we all become buddies.
link |
01:24:13.560
So a few weeks of me bitching,
link |
01:24:15.240
a few weeks of them responding.
link |
01:24:17.760
Beelzebub gets me on ICQ and he sends me a message.
link |
01:24:20.800
He's like, I went by the screen name of Gollum
link |
01:24:22.560
at that point, Gollum Fun.
link |
01:24:24.080
And he's like, Gollum, I can make you
link |
01:24:26.120
a fake driver's license.
link |
01:24:27.200
And I was like, well, motherfucker, do it.
link |
01:24:28.640
And he's like, well, I'm gonna charge you for it.
link |
01:24:30.660
I'm like, yeah, you are.
link |
01:24:32.360
He's like, I am.
link |
01:24:33.880
I was like, no, you're not.
link |
01:24:35.440
And he's like, look, man, he said,
link |
01:24:37.980
this business, if you're gonna do this,
link |
01:24:40.240
you have to trust people or you're gonna fail.
link |
01:24:44.120
He said, so I'm gonna charge you $200,
link |
01:24:46.720
but I'm gonna send you a driver's license.
link |
01:24:49.000
Well, by this point, I'm friends with the people
link |
01:24:51.080
who own Counterfeit Library.
link |
01:24:53.080
We're emailing, chatting, everything else.
link |
01:24:55.640
And I tell him, I'm like, okay, I'm gonna send you $200.
link |
01:24:59.580
That way, when you rip me off, I'll have them ban you
link |
01:25:02.360
and I don't have to deal with you anymore.
link |
01:25:04.000
And he's like, bet.
link |
01:25:04.880
I'm like, okay.
link |
01:25:06.360
So I sent him $200, sent him my picture.
link |
01:25:09.800
Two weeks later, I get a driver's license.
link |
01:25:11.680
Name is Steven Schwecki out of Ohio.
link |
01:25:13.720
And real guy, worked at ADP payroll to this day,
link |
01:25:17.360
works at ADP, is where the guy works.
link |
01:25:20.880
Got the driver's license.
link |
01:25:22.660
And to me, at that point in time,
link |
01:25:24.360
it was the prettiest thing that I'd ever seen.
link |
01:25:27.160
You know, I'd never seen a fake ID before.
link |
01:25:29.540
I thought it was great.
link |
01:25:30.840
Turns out, you know, looking back, it was like, eh.
link |
01:25:33.680
So, but.
link |
01:25:35.320
That is kind of a strong first step
link |
01:25:39.600
in creating a fake identity.
link |
01:25:42.560
Very strong, very strong.
link |
01:25:44.120
So this is. So that was like, Gasko just,
link |
01:25:48.360
on the point he made, that if you're gonna be successful
link |
01:25:53.440
in this, you should have people you trust.
link |
01:25:56.640
Is he right on that?
link |
01:25:58.000
Oh, he's absolutely right.
link |
01:26:00.040
He's absolute.
link |
01:26:00.880
So you have to have, this is like mob.
link |
01:26:03.680
You have to.
link |
01:26:04.520
You have to have an inner circle that you trust.
link |
01:26:07.480
You know, I'm sure you've probably
link |
01:26:08.800
heard me say this before.
link |
01:26:11.400
Successful cyber crime, all right?
link |
01:26:14.560
There are three necessities to being successful online
link |
01:26:17.580
if you're a criminal.
link |
01:26:18.520
Three necessities are gathering data,
link |
01:26:21.080
committing the crime, and then cashing it out.
link |
01:26:24.240
All three of those necessities have to work in conjunction.
link |
01:26:26.720
If they don't, the crime fails.
link |
01:26:28.440
The problem, and it's a huge problem,
link |
01:26:30.760
is that one guy can't do all three things.
link |
01:26:34.880
You know, you've got the people who gather the data.
link |
01:26:37.040
Basically, the general store sells people
link |
01:26:39.680
who sell PII, credit card logins, data tools.
link |
01:26:44.480
They always sell the spoofed phone numbers
link |
01:26:46.220
and the RDPs, stuff like that.
link |
01:26:48.560
A lot of the times, those people don't know
link |
01:26:49.800
how to commit the crime.
link |
01:26:51.080
And those people certainly don't know
link |
01:26:52.200
how to launder the money out, put cash in pocket.
link |
01:26:54.640
So you've got, either because of a skill level,
link |
01:26:58.000
sometimes a geographic location,
link |
01:27:00.160
limits what that individual can do, all right?
link |
01:27:03.240
So you have to rely on people who are good in areas
link |
01:27:06.600
where you are not in order for that crime to succeed.
link |
01:27:10.640
And that means you have to trust those people.
link |
01:27:15.380
So what happens with Shadow Crew, all right?
link |
01:27:17.760
So Counterfeit Library is the start, all right?
link |
01:27:21.440
Counterfeit Library transitions over to Shadow Crew.
link |
01:27:24.520
Right before that transition, there's a Ukrainian guy.
link |
01:27:27.880
By the name of Dmitry Golubov.
link |
01:27:29.600
He was a spammer at that point in time.
link |
01:27:31.240
He saw what we were doing with Counterfeit Library
link |
01:27:34.320
and he liked it.
link |
01:27:35.960
He was getting all these credit card details
link |
01:27:37.760
and this kid, I mean, he's a kid.
link |
01:27:39.940
This kid has an idea.
link |
01:27:41.280
And his idea was, I wonder if people would buy
link |
01:27:43.560
stolen credit card details.
link |
01:27:45.200
That's pretty good Ukrainian Russian accent.
link |
01:27:47.600
So he picks up the phone, he calls his buddies.
link |
01:27:52.200
They call their buddies.
link |
01:27:53.300
They have a physical conference in Odessa.
link |
01:27:56.240
150 of these cyber criminals show up.
link |
01:27:58.440
And they launched this idea,
link |
01:28:00.200
this launches a website called Carter Planet,
link |
01:28:03.080
which is the genesis of all modern credit card theft
link |
01:28:06.040
as we know it, all right?
link |
01:28:07.440
And so, remember I mentioned those three necessities
link |
01:28:10.680
of cyber crime.
link |
01:28:12.440
Dmitry had all the credit data in the world.
link |
01:28:16.040
And he partnered with all these other Ukrainians
link |
01:28:17.800
who had all this data as well.
link |
01:28:19.560
The problem was, is so much fraud had been committed
link |
01:28:22.240
on that Eastern side of Europe,
link |
01:28:24.100
that every card had been shut down.
link |
01:28:26.480
Even if you were a legitimate card holder
link |
01:28:28.880
and tried to cash it out,
link |
01:28:30.080
you weren't doing it at that point.
link |
01:28:32.040
So again, those three necessities,
link |
01:28:33.720
gathering data, committing crime, cashing out.
link |
01:28:35.840
Dmitry had the data.
link |
01:28:37.520
They could commit the crime.
link |
01:28:38.960
They could not put cash in pocket.
link |
01:28:41.640
So we were running counterfeit library.
link |
01:28:44.400
One day I get this message,
link |
01:28:46.120
or not a message, one day script shows up.
link |
01:28:48.840
And he posts just on the general forum.
link |
01:28:50.960
He posts, hey, I've got credit card data.
link |
01:28:54.280
Give me an address, give me a burner phone number,
link |
01:28:56.640
wait five business days, order whatever you want to.
link |
01:28:58.960
We had never seen anything like that.
link |
01:29:01.360
We were a PayPal fraud and eBay fraud site,
link |
01:29:03.680
is what we were, and fake driver's licenses.
link |
01:29:06.280
So then, and we had,
link |
01:29:07.560
I guess we had two, 3,000 members at that point.
link |
01:29:09.960
So the response from the members was, that can't be real.
link |
01:29:16.200
You've gotta be law enforcement.
link |
01:29:17.600
It's gotta be trying to get us arrested and everything else.
link |
01:29:21.080
What, let me backtrack a little bit.
link |
01:29:23.400
So the driver's license that I had got,
link |
01:29:27.160
Beelzebub had an idea.
link |
01:29:28.840
What he wanted to do is he wanted to sell driver's licenses.
link |
01:29:34.800
Mr. X wanted to sell social security cards.
link |
01:29:36.680
He made a very passable social security card.
link |
01:29:39.240
Me, I didn't, I had no skill level on that.
link |
01:29:40.960
I knew PayPal fraud and eBay fraud.
link |
01:29:42.880
So Beelzebub was like, I'll tell you what,
link |
01:29:45.560
you be the reviewer.
link |
01:29:47.360
That way you get every product or service that comes in.
link |
01:29:50.120
They'll have to send it to you or let you have access to it.
link |
01:29:53.040
You can learn the entire game.
link |
01:29:55.480
And because you're not selling anything,
link |
01:29:57.880
it gives you legitimacy on the reviews, all right?
link |
01:30:01.400
So I started out as a reviewer,
link |
01:30:02.640
the only reviewer on Counterfeit Library.
link |
01:30:05.640
So over the next year, Beelzebub turns out
link |
01:30:09.160
he was a pot grower.
link |
01:30:10.120
He goes back to growing pot
link |
01:30:11.800
because he wasn't making shit selling driver's licenses.
link |
01:30:14.480
Mr. X, about a year and a half in,
link |
01:30:16.800
he gets arrested cashing out driver's, not credit cards,
link |
01:30:20.560
cashing out to casinos, doing some shit with that.
link |
01:30:24.240
So I'm the only guy left standing
link |
01:30:26.200
and I'm at the top of the heap.
link |
01:30:28.400
And it becomes this thing where if I review somebody,
link |
01:30:32.600
they make a lot of money.
link |
01:30:33.880
If I don't, you don't do business here.
link |
01:30:36.720
So script shows up saying he's got this.
link |
01:30:38.800
I'm the only reviewer on site.
link |
01:30:41.480
People think he's law enforcement.
link |
01:30:43.960
First week it goes like that.
link |
01:30:45.520
After a while, I'm like, okay, I gotta do something.
link |
01:30:47.320
And I'm scared, man,
link |
01:30:48.240
because I'm like, he may be law enforcement.
link |
01:30:50.560
So I get him on ICQ and I'm like,
link |
01:30:52.040
hey, you have to be reviewed.
link |
01:30:53.120
He's like, what the hell is that?
link |
01:30:54.720
So I tell him what it is, he's like, you reviewed me.
link |
01:30:56.840
I was like, yeah, that's the idea.
link |
01:30:58.520
So give him a drop address, give him a burner phone number,
link |
01:31:03.000
wait five business days,
link |
01:31:04.440
and I try to hit Dell for $5,000.
link |
01:31:06.840
The order fails.
link |
01:31:08.160
I get back on ICQ, hey man, it didn't work.
link |
01:31:10.400
He's like, give me one more chance.
link |
01:31:12.000
I was like, look, I'll give you one more chance,
link |
01:31:13.760
but it's your ass after that.
link |
01:31:15.080
He's like, one more chance.
link |
01:31:16.720
I go, okay, give him another address, another phone number,
link |
01:31:20.080
wait another five business days,
link |
01:31:22.400
hit Thompson's Computer Warehouse for $4,000,
link |
01:31:25.320
Dell for $5,000.
link |
01:31:26.880
Order goes through, get the products in.
link |
01:31:29.800
I post that review on Counterfeit Library,
link |
01:31:33.880
and literally overnight,
link |
01:31:35.600
we turn from an eBay PayPal fraud site
link |
01:31:38.240
to a credit theft site.
link |
01:31:40.000
And that becomes a lot of money really quickly for members.
link |
01:31:44.160
So we were doing, now it's called CMP fraud,
link |
01:31:46.760
card not present fraud.
link |
01:31:47.720
So you hit an online merchant
link |
01:31:49.720
with stolen credit card data.
link |
01:31:51.280
Back then, a fairly experienced fraudster
link |
01:31:54.560
could profit 30 to $40,000 a month, okay?
link |
01:31:58.640
Just buying laptops, what have you,
link |
01:32:00.800
and cashing out, put them on eBay for sale
link |
01:32:03.080
and sell them like that.
link |
01:32:03.920
And 30 to 40K a month was the profit on that.
link |
01:32:06.880
Script had a lot of buddies.
link |
01:32:08.520
He had people like Roman Vega,
link |
01:32:11.000
these other guys that would sell
link |
01:32:12.520
not just credit card data,
link |
01:32:14.120
but counterfeit physical credit cards as well.
link |
01:32:17.280
We had, and he.
link |
01:32:18.480
Counterfeit, not stolen.
link |
01:32:20.080
So counterfeit.
link |
01:32:21.000
Counterfeit.
link |
01:32:22.600
That must be tough to do.
link |
01:32:25.160
So the connection.
link |
01:32:26.000
That must be harder than driver's licenses.
link |
01:32:28.280
It's crazy.
link |
01:32:29.120
So what BOA initially had,
link |
01:32:32.680
and I became the United States salesperson for BOA,
link |
01:32:37.160
but what he had was,
link |
01:32:38.240
is he was the first dumps provider in the United States.
link |
01:32:42.440
So on the back of your credit or debit card,
link |
01:32:44.640
there's a magnetic stripe.
link |
01:32:47.120
Three data tracks on the stripe.
link |
01:32:48.440
There was the first data track is the customer's name.
link |
01:32:50.400
Second data track is the card number,
link |
01:32:52.640
forward slash 16 digit algorithm outside of that.
link |
01:32:56.080
That's important.
link |
01:32:56.920
We'll get back to that in a few minutes.
link |
01:32:58.560
Third data track is called indiscriminate data.
link |
01:33:00.560
No one uses it, all right?
link |
01:33:02.600
So what's bought and sold is the second data track.
link |
01:33:05.760
It's called the dump.
link |
01:33:06.920
And the reason that's sold is when you go into a shop,
link |
01:33:10.120
you insert the card or you swipe the card,
link |
01:33:12.840
the only information that's sent out for verification
link |
01:33:15.320
is the second data track, all right?
link |
01:33:17.280
That goes to the processor bank for verification.
link |
01:33:19.760
The first data track, that customer's name,
link |
01:33:21.640
shows up on the screen of the cashier in front of you.
link |
01:33:24.640
So what typically happens is,
link |
01:33:26.400
is you buy 10 of these dumps.
link |
01:33:28.200
You get 10 counterfeit cards
link |
01:33:30.560
in code track two on all 10 cards.
link |
01:33:32.440
Track one, you create one fake driver's license.
link |
01:33:35.320
Track one is just the name
link |
01:33:36.680
of that one fake driver's license.
link |
01:33:38.200
That way, when you go in the shop, swipe the card,
link |
01:33:40.280
track two gets sent off for verification.
link |
01:33:42.120
Track one shows up on the screen in front of the cashier.
link |
01:33:44.920
If you ever ask for ID, you pull out the fake ID.
link |
01:33:47.600
Everyone's a nice, warm, fuzzy.
link |
01:33:48.880
You walk out with the cameras, Rolex.
link |
01:33:51.240
And track one could be, it doesn't have to be connected.
link |
01:33:54.120
It's not connected to track two.
link |
01:33:55.120
Not connected at all, all right?
link |
01:33:57.320
That's one of the big problems, all right?
link |
01:33:59.880
So Scrip brought a host of technical people
link |
01:34:05.560
into that type of environment,
link |
01:34:07.000
all committing credit card theft.
link |
01:34:08.520
We had proxy providers.
link |
01:34:10.200
We had all these people that were doing this stuff.
link |
01:34:13.080
We start making a lot of money, a lot.
link |
01:34:15.560
And the reason that happens is, again,
link |
01:34:17.680
Scrip did not have the ability to cash out.
link |
01:34:21.160
So he was reduced to selling things.
link |
01:34:23.600
And at the same time, he's looking for,
link |
01:34:25.160
how do I make more money, all right?
link |
01:34:28.120
The Ukrainians happened upon this thing
link |
01:34:31.520
called the CVV1 breach, or hack,
link |
01:34:34.440
is what they called it.
link |
01:34:36.120
So what happens is, remember I told you track two,
link |
01:34:39.120
card number forward slash 16 digit algorithm.
link |
01:34:43.440
You gotta know the algorithm to encode it
link |
01:34:46.320
so you can swipe the card or take it to the ATM machine.
link |
01:34:49.360
All right, ATM.
link |
01:34:51.800
You gotta know it.
link |
01:34:52.800
Now we were fishing data from hell.
link |
01:34:54.840
I mean, we were doing a lot of fishing, a lot.
link |
01:34:58.600
We were getting pins, we were getting card numbers,
link |
01:35:01.360
but you can't get that algorithm.
link |
01:35:03.680
So Ukrainians start testing stuff.
link |
01:35:07.000
What they found out was no bank
link |
01:35:10.240
had implemented the hash on track two.
link |
01:35:13.640
So you take the card number forward slash any 16 digits,
link |
01:35:17.600
it would encode.
link |
01:35:19.360
Take it to the ATM, pull cash out,
link |
01:35:21.840
because you got the pin, all right?
link |
01:35:24.280
Started doing that.
link |
01:35:26.320
Well, wait, sorry, I'm trying to understand.
link |
01:35:28.680
So that means, so if there's no hash,
link |
01:35:32.960
are they generating random numbers
link |
01:35:34.680
or do they have valid numbers for track two?
link |
01:35:37.120
No numbers needed at all,
link |
01:35:38.320
as long as just the track two was a complete track two.
link |
01:35:41.840
So it's a valid track two that doesn't match,
link |
01:35:45.680
so the pin is the thing that gets you in?
link |
01:35:48.560
So back then, all right, back then,
link |
01:35:50.240
what we're talking about is you needed,
link |
01:35:52.120
typically today you need a whole track two.
link |
01:35:54.320
You need that valid track two.
link |
01:35:55.800
All right, you need the 16 digit card number,
link |
01:35:59.040
forward slash, and then whatever that algorithm
link |
01:36:01.320
does, the other side of it, all right?
link |
01:36:03.160
Back then, none of the banks had implemented that algorithm.
link |
01:36:06.760
So while the algorithm was there,
link |
01:36:08.920
you didn't need it to encode.
link |
01:36:13.640
Interesting.
link |
01:36:14.480
Interesting.
link |
01:36:15.920
So you can make a lot of money with physical of fake.
link |
01:36:20.960
So much money that card not present fraud.
link |
01:36:24.000
Card not present fraud, remember I told you,
link |
01:36:25.520
was $30,000 to $40,000 a month, all right?
link |
01:36:28.320
That turned into $30,000 to $40,000 a day.
link |
01:36:32.560
The Ukrainians, again, they can't cash it out.
link |
01:36:36.800
They've got all the data on the planet,
link |
01:36:38.240
but they can't cash it out,
link |
01:36:39.240
those three necessities of cybercrime.
link |
01:36:41.400
So the deal became, you have to rely on the Americans.
link |
01:36:44.600
Tell you what, we'll give you 40%.
link |
01:36:46.600
So you had all these cashiers
link |
01:36:48.080
that were 40% of $40,000 a day.
link |
01:36:51.160
Yeah, we'll take that, all right?
link |
01:36:53.360
Send the rest of it over to buy Western Union
link |
01:36:55.560
or what have you to your Ukrainian contact.
link |
01:36:57.880
That's before cryptocurrency came into play.
link |
01:36:59.720
Now you had a couple of forerunners
link |
01:37:01.000
with eGold and Liberty Reserve, things like that.
link |
01:37:04.320
But back then it starts out with Western Union,
link |
01:37:07.680
then it becomes prepaid cards,
link |
01:37:09.360
sending track information over,
link |
01:37:11.120
loading the card up like that,
link |
01:37:12.440
and then finally you get to eGold, Liberty Reserve,
link |
01:37:14.480
and then today it's with crypto that's used.
link |
01:37:19.840
Started stealing a lot of money, a lot.
link |
01:37:23.240
And that got law enforcement attention.
link |
01:37:26.560
So we started to see, I mean, it's a crazy ass story.
link |
01:37:30.400
We started to see IPs coming in
link |
01:37:33.600
from law enforcement agencies, government agencies,
link |
01:37:35.640
because back then they didn't know
link |
01:37:36.760
how to shield their identity either.
link |
01:37:38.280
So you saw Secret Service, you saw DoD,
link |
01:37:42.080
you saw all these like, and you're like,
link |
01:37:44.520
that's interesting.
link |
01:37:45.480
So, you know, and at the same time,
link |
01:37:51.440
it was called a hack, but it wasn't a hack.
link |
01:37:54.120
We had a guy that worked at T Mobile in Los Angeles.
link |
01:37:58.840
This is the same guy that back then
link |
01:38:01.240
published Paris Hilton's phone contact list.
link |
01:38:04.640
That made a lot of news.
link |
01:38:07.200
Not only did he do that, but it turned out
link |
01:38:09.800
that the Los Angeles Secret Service Agency
link |
01:38:12.440
was using T Mobile phones.
link |
01:38:14.240
So he's getting text messages of the Secret Service
link |
01:38:17.960
investigating Shadow Crew,
link |
01:38:19.960
and he posts those damn things on Shadow Crew.
link |
01:38:21.840
So I'm sitting there going, head of the pile,
link |
01:38:23.920
I'm sitting there going, this is not gonna end well.
link |
01:38:27.040
This is not gonna end well.
link |
01:38:28.600
So at the same time, I had access,
link |
01:38:31.400
I started out with access
link |
01:38:33.080
to the Indiana State Sex Offenders Registry,
link |
01:38:35.720
and I was using that to create bank accounts,
link |
01:38:37.880
launder the money out, and I would sell the bank accounts,
link |
01:38:39.720
stuff like that.
link |
01:38:42.000
They shut that down.
link |
01:38:43.160
The next database I had access to
link |
01:38:44.960
was the Texas Driver's License database,
link |
01:38:47.640
and started using that to create fake driver's licenses,
link |
01:38:51.080
what have you.
link |
01:38:52.120
And then finally, we happened upon
link |
01:38:54.440
the California Death Index, all right?
link |
01:38:58.840
Complete information, mother's maiden,
link |
01:39:00.800
socials, DOBs, all that, and it's like,
link |
01:39:04.680
gotta be a use for that.
link |
01:39:06.280
Well, you can use it to create identities all day long.
link |
01:39:09.680
My idea was, I wonder if you could take somebody
link |
01:39:14.840
that's died and then file for social security death benefit,
link |
01:39:18.480
not death benefits, but social security benefits
link |
01:39:20.360
for that individual, and get that recurring paycheck in.
link |
01:39:23.200
So that takes a lot of research
link |
01:39:24.680
to start seeing if you can do that.
link |
01:39:26.760
How does the federal government know if you're dead?
link |
01:39:29.440
Do federal indexes reference state indexes?
link |
01:39:32.680
You got all these questions that pop up.
link |
01:39:34.920
Well, it turns out, federal indexes
link |
01:39:36.760
don't reference state indexes, it's against the law.
link |
01:39:39.760
It also turns out, the only way the federal government
link |
01:39:42.200
knows you're dead is prior to 1998,
link |
01:39:46.120
the family had to file a social security death benefit
link |
01:39:51.000
for that person, all right?
link |
01:39:53.800
Prior to 98.
link |
01:39:54.640
Which of course most people don't.
link |
01:39:56.040
Right, prior to 98, it took the family.
link |
01:39:58.560
After 98, the hospital can do it,
link |
01:40:01.200
funeral home can do it, or the family can do it.
link |
01:40:03.560
So a lot more people have it filed after,
link |
01:40:05.840
if they've died after.
link |
01:40:06.680
But it's still, there's a lot of people
link |
01:40:08.320
who probably don't. A lot of people don't.
link |
01:40:09.840
Because that death benefit's only like $219, okay?
link |
01:40:13.960
Nobody's thinking about that shit.
link |
01:40:15.960
So I started to apply for social security benefits.
link |
01:40:19.840
Nope, number's dormant.
link |
01:40:21.760
So they want you to come in for a physical interview.
link |
01:40:23.760
Here I am, you know, 32.
link |
01:40:26.480
You're not gonna pass as a 65 year old, so no.
link |
01:40:29.600
So the next idea I had was,
link |
01:40:32.920
I wonder if you could file income tax returns
link |
01:40:34.800
on these people.
link |
01:40:37.080
Turns out you can, all day long.
link |
01:40:40.400
So I started doing that.
link |
01:40:42.120
And I started to steal, once I got ramped up,
link |
01:40:45.080
because you test everything.
link |
01:40:46.280
You know, you're testing to make sure,
link |
01:40:47.720
you gotta figure out what the deposit instrument is
link |
01:40:50.400
and everything else.
link |
01:40:51.240
And once you get all that lined out,
link |
01:40:53.240
I started to steal $160,000 a week,
link |
01:40:55.960
every week for 10 months out of the year.
link |
01:40:58.520
By paying taxes?
link |
01:41:00.800
By filing fake returns.
link |
01:41:03.120
Yeah, filing fake tax returns.
link |
01:41:05.120
So you find a business, and the way the system worked
link |
01:41:07.680
is the IRS will issue a refund on somebody
link |
01:41:11.760
before they're able to verify
link |
01:41:13.120
that that person worked for an employer.
link |
01:41:15.360
Still works like that today.
link |
01:41:17.440
All right, so.
link |
01:41:18.440
And you're keeping the amounts relatively low.
link |
01:41:20.560
Keep them at $3,000.
link |
01:41:22.600
All right.
link |
01:41:23.440
Amounts are very low.
link |
01:41:24.280
But you're still able to achieve scale
link |
01:41:25.680
because this large index of real people.
link |
01:41:27.200
I got to where, and I was manual.
link |
01:41:28.920
Later on, a couple buddies of mine
link |
01:41:30.280
went automated with it.
link |
01:41:31.520
Wait, you were doing this by hand?
link |
01:41:32.960
So there's no code involved?
link |
01:41:34.760
All manual.
link |
01:41:35.720
Wow.
link |
01:41:36.560
I'd file a return once every six minutes.
link |
01:41:39.280
Work 10 hours a day, three days a week.
link |
01:41:42.120
So clicking on, so typing fast and clicking.
link |
01:41:44.680
One return every six minutes.
link |
01:41:46.560
That's changing IP.
link |
01:41:47.880
That's changing address.
link |
01:41:49.320
Everything else, one return every six minutes.
link |
01:41:52.680
For three days a week.
link |
01:41:54.040
Fourth day, I would take a road trip,
link |
01:41:57.040
plot out a map of ATMs.
link |
01:41:59.280
And then the next two days, cash out.
link |
01:42:01.520
Bam, bam, bam, bam, bam.
link |
01:42:02.880
All right.
link |
01:42:03.720
Come back home, rinse and repeat.
link |
01:42:06.240
Turns out that a backpack,
link |
01:42:08.040
I don't see anybody sitting around here,
link |
01:42:09.320
but a backpack will hold $150,000 of 20s,
link |
01:42:12.960
is what it will hold.
link |
01:42:14.400
So I'd put 150K and 20s in a backpack.
link |
01:42:16.680
I had a spare bedroom.
link |
01:42:18.240
I'd come in, toss the backpack in the bedroom.
link |
01:42:21.040
This is very, very important information.
link |
01:42:23.080
And the fact that you know it is also very,
link |
01:42:25.360
first we started with the volume of coal that weighs a ton,
link |
01:42:27.920
and now a backpack holds $150,000 of 20s.
link |
01:42:32.280
And then you can multiply that by five 400s.
link |
01:42:35.320
Yeah.
link |
01:42:36.240
I like this.
link |
01:42:37.080
It's also times 20s coming out of ATM, right?
link |
01:42:39.680
Each 20 weighs a gram.
link |
01:42:42.000
Each 20 weighs a gram.
link |
01:42:43.840
So you can actually go by weight,
link |
01:42:45.480
which is what federal authorities do
link |
01:42:47.320
when they get a pallet of cash, they just weigh it.
link |
01:42:49.920
Oh, they just, they just weigh it.
link |
01:42:52.200
So 150K is seven and a half keys of cash.
link |
01:42:55.720
One and a half, 15, oh, that's pretty light.
link |
01:42:59.440
Not bad, not bad.
link |
01:43:00.280
Yeah, you get a big backpack,
link |
01:43:02.080
go do a good run with David Goggins with it.
link |
01:43:05.120
I like it.
link |
01:43:05.960
The fact that you know this is great.
link |
01:43:08.560
So wait, where does that come in with the backpack?
link |
01:43:11.320
So what happens is I didn't know how to launder money.
link |
01:43:14.040
All right, so I'm throwing cash in the spare bedroom.
link |
01:43:17.280
One day you open up the bedroom and you're like,
link |
01:43:20.320
gotta do something with those backpacks.
link |
01:43:22.120
And that's when you start learning how to launder money,
link |
01:43:25.200
cash based businesses, things like that.
link |
01:43:26.880
I had a production company,
link |
01:43:28.040
had a couple of detailing company.
link |
01:43:29.560
I was thinking about going into food trucks,
link |
01:43:31.900
things like that in Charleston.
link |
01:43:33.080
Actually, can you pause on that to take a tangent there?
link |
01:43:35.240
How does money laundering work?
link |
01:43:39.080
I mean, at that time and what years are we talking about?
link |
01:43:42.240
This is, by the time the tax return schemes go into play,
link |
01:43:46.840
we're talking 2002, 2003 is when tax returns start.
link |
01:43:51.000
And so what, at that time and what you're aware of now,
link |
01:43:54.920
how it evolved, how does money laundering work?
link |
01:43:59.400
You know, it's not that much different.
link |
01:44:00.640
It's really not.
link |
01:44:02.200
You get a cash based business,
link |
01:44:04.160
start laundering the money or putting the money through that,
link |
01:44:06.160
saying the transactions are legal.
link |
01:44:08.080
You then start depositing into bank accounts.
link |
01:44:11.160
From bank accounts, my thing was is
link |
01:44:15.880
have bank accounts in the United States, Mexico, Canada,
link |
01:44:19.920
and then finally bounce over to Estonia
link |
01:44:22.400
was the final destination of all this stuff.
link |
01:44:24.040
And the idea is to try to move them to so many places
link |
01:44:28.480
that by the end of the day, it looks legal
link |
01:44:31.200
and you can't trace it all if you're ever caught,
link |
01:44:34.480
which you ultimately are.
link |
01:44:36.280
But so cash based businesses, you know.
link |
01:44:38.400
So when you say, sorry to interrupt,
link |
01:44:40.040
the cash based businesses,
link |
01:44:41.800
so you have money that needs to be moved to other people.
link |
01:44:48.680
So how does that work?
link |
01:44:49.600
What's the business?
link |
01:44:50.880
Are people providing you a service
link |
01:44:52.640
and you're giving them money?
link |
01:44:54.320
Right, so you do the Ozark thing if you wanna do that.
link |
01:44:57.440
So you can gamble, cash out something like that.
link |
01:44:59.640
So it trips to whatever casinos you've got.
link |
01:45:02.560
You've got your production company or your detail company.
link |
01:45:05.880
So how many cars are you cleaning a day?
link |
01:45:08.080
How many companies have you got to do that?
link |
01:45:10.280
All right, whatever that company is,
link |
01:45:12.680
it's gotta be cash based.
link |
01:45:13.760
Somebody's paying you in cash is what you're doing.
link |
01:45:16.960
You have to have enough of those cash based businesses
link |
01:45:19.040
where it doesn't look funny.
link |
01:45:21.200
All right, because if you're a detail company
link |
01:45:23.160
making $100,000 a month, that's a problem.
link |
01:45:26.000
Okay, so then you start depositing into that.
link |
01:45:30.320
Well, because of the Patriot Act,
link |
01:45:33.200
a suspicious activity report, SARS, came in at $2,500
link |
01:45:37.760
instead of the 10K that it used to be.
link |
01:45:40.360
So all of a sudden you've got multiple bank accounts
link |
01:45:42.240
that you've got to set up, all right?
link |
01:45:44.680
Fortunately, what you also had
link |
01:45:46.320
is you had a bunch of prepaid debit cards
link |
01:45:47.960
that were coming into play at the same time.
link |
01:45:49.840
So a combination of bank accounts, prepaid debits
link |
01:45:53.760
that had ACH abilities attached to those as well,
link |
01:45:56.480
and you start running them all together.
link |
01:45:58.360
Then once it's out of the United States,
link |
01:46:00.240
you don't have to worry as much.
link |
01:46:01.320
You can start funneling that into fewer bank accounts
link |
01:46:05.320
until finally you've got the one main account
link |
01:46:07.640
that's over at Bank Letico in Estonia at that point.
link |
01:46:11.280
That's what you've got.
link |
01:46:12.960
So a bunch of hops that end up at a place
link |
01:46:15.400
that you can't trace.
link |
01:46:16.360
And to give you an idea, I was arrested February 8th, 2005.
link |
01:46:19.840
My last seizure was 2010.
link |
01:46:22.920
Got the last seizure notice.
link |
01:46:24.320
So they got it, but it didn't took them that long
link |
01:46:28.760
to get to it.
link |
01:46:30.320
So how do stories like with Script that come into play here
link |
01:46:34.400
where he had someone who owed him money
link |
01:46:38.680
kidnapped and tortured.
link |
01:46:40.080
So when does it turn darker?
link |
01:46:45.160
It turns darker the more money you make.
link |
01:46:48.800
Script was a kid that he was stealing enough money
link |
01:46:52.840
that he was able to buy whatever estate he wanted to.
link |
01:46:55.120
And he would brag about touring the countryside.
link |
01:46:58.000
And if he saw property that he liked, he would buy it.
link |
01:47:00.960
And that was not just a brag, he was doing that.
link |
01:47:03.880
So this kid is stealing a lot of money.
link |
01:47:05.800
At the same time, he's got connections politically
link |
01:47:08.640
because of his family, he's got connections
link |
01:47:10.960
and that family's got connections with a Ukrainian mob.
link |
01:47:13.560
All right, so he's got these inroads
link |
01:47:16.240
and people are looking out for him
link |
01:47:17.760
and he's stealing a lot of money at the same time.
link |
01:47:20.040
Somebody doesn't pay him a decent amount of money.
link |
01:47:24.400
Somebody doesn't pay him.
link |
01:47:25.400
Now we had never, with Shadow Crew, with Carter Planet,
link |
01:47:29.400
with Counterfeit Library, we were basically the geeks.
link |
01:47:33.240
All right, we were just the fraudsters,
link |
01:47:35.360
the social engineers.
link |
01:47:36.880
We had never really considered violence.
link |
01:47:38.880
The rules that I had in play were,
link |
01:47:40.560
hey, we don't do child pornography,
link |
01:47:43.160
we don't do counterfeit currency, we don't do drugs.
link |
01:47:46.800
And the only thing we ended up really obeying
link |
01:47:48.880
was the child porn stuff, except for Max Butler,
link |
01:47:51.640
who you mentioned earlier.
link |
01:47:54.520
Script, someone rips the guy off.
link |
01:47:57.240
And he comes online on Shadow Crew at that point
link |
01:48:02.280
and he posts these pictures one day.
link |
01:48:04.320
And I mean, it was a detailed narrative through the pictures.
link |
01:48:07.280
Had the guy that rammed in the van,
link |
01:48:10.320
he had the door open, rammed in the van,
link |
01:48:12.720
had the guy tied up, had the guy being tortured.
link |
01:48:15.800
And the response was, this is what happens
link |
01:48:20.240
when you steal from me.
link |
01:48:22.480
And that's the first time that violence came into play
link |
01:48:27.800
at that point, and that's when things got,
link |
01:48:29.960
you start realizing things are getting a little serious.
link |
01:48:32.600
How did that make you feel?
link |
01:48:34.680
The first response is, can't be real.
link |
01:48:38.080
He's just doing that.
link |
01:48:42.040
You know, he's wanting to send a message.
link |
01:48:44.160
Then you're like, no, that's real, that's real.
link |
01:48:49.960
Were you afraid in your own heart
link |
01:48:52.000
that you might descend to that too?
link |
01:48:55.160
Like if you see that, or was it pretty clear to you
link |
01:48:58.480
that that's a line that some people can cross
link |
01:49:02.320
and some can't and you're not one of those that can cross it?
link |
01:49:05.040
You know, I gotta tell you, I joke with my wife.
link |
01:49:10.040
The joke I tell my wife is, you know,
link |
01:49:13.040
I knew some guy that had 8,000 Bitcoins.
link |
01:49:15.960
I might be persuaded to ask him for access to that.
link |
01:49:19.560
And she was like, how?
link |
01:49:20.400
And I was like, well, hammer and toes.
link |
01:49:23.440
And I say that as a joke,
link |
01:49:28.120
but there's that line where you're like,
link |
01:49:32.160
I remember who I used to be.
link |
01:49:34.200
And if you're looking at that kind of money,
link |
01:49:38.480
I might be persuaded to do that back then.
link |
01:49:41.560
You know, that's, and I think that was Scripps issue
link |
01:49:46.800
is it was a lot of money to him.
link |
01:49:49.160
There's the money.
link |
01:49:50.000
And then there's, you know, violence can also be gradual.
link |
01:49:53.240
So over time you do a little more, a little more,
link |
01:49:54.840
a little more, a little more.
link |
01:49:56.840
You get used to what's going on
link |
01:49:58.400
and then I get desensitized.
link |
01:49:59.680
And you figure, you take somebody like Ross Ulbricht,
link |
01:50:02.880
the Silk Road guy, all right.
link |
01:50:05.880
Ross was not a violent guy.
link |
01:50:08.040
He was not.
link |
01:50:08.960
But at that point in time, you know,
link |
01:50:10.240
he was sitting on 24 million in Bitcoin.
link |
01:50:13.120
He was the only game in town.
link |
01:50:15.120
And that 24 now is like, I don't know,
link |
01:50:17.200
22, 24 billion, some crap like that.
link |
01:50:20.440
But he felt in danger.
link |
01:50:27.080
This guy was gonna turn him in.
link |
01:50:28.640
You know, it was a black mountain and everything.
link |
01:50:29.920
So Ross thinks he hires a couple hit men to kill the guy.
link |
01:50:34.800
So it becomes that thing.
link |
01:50:36.680
And I saw that over and over again.
link |
01:50:38.520
And I'd like to say I wasn't like that,
link |
01:50:41.240
but given the same circumstances,
link |
01:50:43.920
I would have probably done the same thing.
link |
01:50:46.280
And also when you're, it's not just about money,
link |
01:50:49.040
there's a lot of other forces.
link |
01:50:50.200
Like if you're threatened for your wellbeing
link |
01:50:54.400
or for your wealth or for your power,
link |
01:50:56.240
all of us operate under different motivations.
link |
01:50:59.240
Plus that online aspect with those communities like that,
link |
01:51:02.560
if you're the head guy,
link |
01:51:03.920
you really feel like you're the parent of these guys.
link |
01:51:06.320
So somebody is starting to threaten them,
link |
01:51:07.840
it's like, all right, what do I need to do?
link |
01:51:10.360
So what do you make of Silk Road?
link |
01:51:12.000
The Shadow Crew started something that today
link |
01:51:16.400
you can call dark net and dark net markets.
link |
01:51:19.520
So these markets that operate, that trade,
link |
01:51:23.600
trade things, everything from child pornography to drugs,
link |
01:51:28.600
to, I mean, what else?
link |
01:51:31.680
Everywhere.
link |
01:51:32.520
What are the dark things that humans want to do
link |
01:51:34.640
that they don't want anyone to know about?
link |
01:51:36.640
All of those things.
link |
01:51:39.920
So can you maybe tell me, you know what?
link |
01:51:44.040
Let's just even step back.
link |
01:51:45.160
What is the dark net?
link |
01:51:46.200
How big is it?
link |
01:51:47.600
What happens there?
link |
01:51:48.920
Let's backtrack a little bit more before we get to that.
link |
01:51:51.960
All right, what Shadow Crew did,
link |
01:51:56.720
other than dealing in all these stolen wares,
link |
01:52:01.720
what Shadow Crew did that's really important.
link |
01:52:04.960
Remember those three necessities that I talked about?
link |
01:52:08.000
But the important thing is,
link |
01:52:09.520
is it established trust among criminals, all right?
link |
01:52:13.200
Because that's a necessity.
link |
01:52:14.360
You have to be able to trust who you're dealing with
link |
01:52:17.440
because you have to deal with somebody.
link |
01:52:19.320
You have to, all right?
link |
01:52:21.240
So how do you know you're not dealing with a cop?
link |
01:52:23.480
How do you know you're dealing
link |
01:52:24.320
with somebody that's skilled?
link |
01:52:25.520
How do you know you're going to deal with somebody
link |
01:52:26.640
that's not going to rip you off?
link |
01:52:27.960
You have to be able to trust that individual.
link |
01:52:30.040
The Shadow Crew provided
link |
01:52:31.160
that trust mechanism for criminals.
link |
01:52:33.000
You had that communication channel, the forums,
link |
01:52:35.840
where you could reference conversations weeks, months old,
link |
01:52:38.880
take part and learn from those conversations.
link |
01:52:41.320
You had vouching systems and review systems in place,
link |
01:52:44.080
escrow systems in place.
link |
01:52:46.080
You knew by looking at someone's screen name,
link |
01:52:49.720
if you could trust the individual,
link |
01:52:51.520
network with the individual, all right?
link |
01:52:53.320
And that community of just humans
link |
01:52:57.560
provided that backbone of trust.
link |
01:53:01.240
And that's really interesting when you think about it.
link |
01:53:04.080
You had the trust that was there,
link |
01:53:05.520
but you also had this,
link |
01:53:08.400
almost this instantaneous information
link |
01:53:11.360
that was available about the community
link |
01:53:13.640
or about cyber crime at large.
link |
01:53:15.440
And that's still in play today, all right?
link |
01:53:18.080
So that was the way things were
link |
01:53:21.440
until a couple of things happened.
link |
01:53:23.160
And one was cryptocurrency.
link |
01:53:25.640
The other one was the Tor browser, the dark web.
link |
01:53:29.000
Now I was working with a secret service,
link |
01:53:30.920
ripping the secret service off,
link |
01:53:32.840
when Tor comes into play, all right?
link |
01:53:34.840
So we got a memo in one day
link |
01:53:37.080
and it was talking about the Tor browser.
link |
01:53:38.840
And it was like, we really need to be careful with this.
link |
01:53:41.840
This is going to be problem.
link |
01:53:43.240
And so we all fired up the Tor browser
link |
01:53:45.640
and it turns out it was, this was 2005, early six.
link |
01:53:50.480
It turns out it was completely unusable,
link |
01:53:52.160
could not use it at all,
link |
01:53:53.200
simply because no one was using it
link |
01:53:55.080
and it was extremely slow.
link |
01:53:56.440
So for people who don't know,
link |
01:53:58.240
Tor browser is a way to be completely anonymous.
link |
01:54:01.440
As long as you properly know how to use it, huge caveat.
link |
01:54:04.920
All right, so developed by the United States Navy
link |
01:54:07.840
and they developed it.
link |
01:54:08.680
I don't know this.
link |
01:54:10.040
Oh yeah.
link |
01:54:10.880
It wasn't the hackers that, interesting.
link |
01:54:13.280
US Navy, to this day, the number one funder of Tor,
link |
01:54:17.280
military, to this day, all right?
link |
01:54:20.400
Interesting.
link |
01:54:21.240
I mean, the same, I guess with the internet,
link |
01:54:22.440
the origins are the dark web and DOD.
link |
01:54:25.080
It was developed so that operatives could communicate
link |
01:54:28.400
with each other without being identified, all right?
link |
01:54:31.360
That then goes open source.
link |
01:54:33.160
They release it, EFF comes in,
link |
01:54:35.200
start sponsoring and everything else like that.
link |
01:54:38.320
The next idea was, well, you know,
link |
01:54:40.160
people can get around their country's firewalls,
link |
01:54:42.520
whistleblowers can use it, things like that.
link |
01:54:44.160
Well, someone forgot to mention
link |
01:54:45.800
that the first adoptees of tech,
link |
01:54:48.000
if you can use it to launder money or remain anonymous,
link |
01:54:50.960
are criminals.
link |
01:54:52.880
And so criminals start to use the damn thing.
link |
01:54:55.320
All right?
link |
01:54:56.680
So along the same time we get,
link |
01:54:59.080
well, a few years later,
link |
01:55:00.040
we get Satoshi Nakamoto pops up
link |
01:55:02.560
with his ideas for Bitcoin,
link |
01:55:05.240
and then Ross Ulbrich runs with it.
link |
01:55:07.640
Ross Ulbrich decides he's gonna start up Silk Road.
link |
01:55:10.160
So initially the people who were using Tor,
link |
01:55:13.080
which later is the dark web,
link |
01:55:15.120
people were using Tor or just talking with each other,
link |
01:55:18.600
visiting websites, communicating like that.
link |
01:55:21.560
Someone figured out,
link |
01:55:22.400
hey man, we could host websites on this thing,
link |
01:55:25.920
and they have a lot of trouble finding the box.
link |
01:55:28.960
So that is the advent of Silk Road all of a sudden.
link |
01:55:33.680
Ross Ulbrich has this idea
link |
01:55:35.120
that he's gonna change the world
link |
01:55:37.760
by becoming the largest drug dealer on the planet.
link |
01:55:40.960
So he opens up the Silk Road
link |
01:55:42.600
and the only payment instrument he allows is Bitcoin.
link |
01:55:46.520
So if those people out there are wondering
link |
01:55:48.640
why Bitcoin is going at what, 44K today?
link |
01:55:51.800
Yeah, and by the time this is out,
link |
01:55:54.120
it could be 100,000 or 10,000.
link |
01:55:56.240
Absolutely.
link |
01:55:57.080
We'll see.
link |
01:55:57.920
Who knows?
link |
01:55:58.760
If it's 10,000, I'm going to buy some.
link |
01:56:04.000
Which is a hilarious statement to make
link |
01:56:06.040
because that statement would be ridiculously wrong
link |
01:56:09.200
like five years ago, right?
link |
01:56:10.560
I know, I know, I know.
link |
01:56:12.680
People 100 years from now will be laughing,
link |
01:56:14.560
wait, it was that low back then?
link |
01:56:18.480
So he only accepts Bitcoin,
link |
01:56:20.080
and of course the initial use case of crypto
link |
01:56:23.960
is no one wants to admit it today,
link |
01:56:26.600
but the initial use case is we're gonna buy a bunch of pot.
link |
01:56:29.880
We need somebody, we need a way to pay for it.
link |
01:56:33.600
So that's what happens.
link |
01:56:35.520
Ross, it's really interesting to me.
link |
01:56:38.680
If you look at motivations of cyber criminals,
link |
01:56:43.240
the motivations are status, cash, ideology, all right?
link |
01:56:48.040
My guys, all cash, across the board, all cash.
link |
01:56:52.280
Ross is ideology.
link |
01:56:54.640
He really believed he was gonna change the world.
link |
01:56:57.080
He really didn't.
link |
01:56:57.920
I've been fortunate.
link |
01:56:59.280
I actually know the guy who ran Silk Road 2
link |
01:57:03.680
and have talked to the kid, everything else,
link |
01:57:07.000
and I will tell you that those guys
link |
01:57:10.040
who are motivated by ideology,
link |
01:57:13.960
they are a completely different breed.
link |
01:57:16.080
They really are.
link |
01:57:17.080
It's not, you know, the cash guy, it's low hanging fruit.
link |
01:57:21.640
The ease of, it's hard to stop committing crime,
link |
01:57:26.320
but it's much easier for a cash motivated individual
link |
01:57:29.400
to stop than it is that ideology guy.
link |
01:57:32.520
That Silk Road 2 guy, he's still got it.
link |
01:57:35.080
You know, he's not breaking the law,
link |
01:57:36.520
but you can see it's like, he wants to, he wants to.
link |
01:57:41.360
So it's...
link |
01:57:44.000
That's fascinating that, I mean,
link |
01:57:45.760
the worst atrocities in human history
link |
01:57:47.680
are committed with people that operate under ideology.
link |
01:57:51.160
All the other motivations are much weaker.
link |
01:57:53.160
But you know, you think about it,
link |
01:57:54.920
with Ross, I mean, very bright guy, very bright guy,
link |
01:57:59.640
but think about the amount of cognitive dissonance
link |
01:58:02.320
that the guy's got,
link |
01:58:04.160
that he thinks he's gonna change the world
link |
01:58:06.640
by running a drug site.
link |
01:58:09.640
I mean, certainly, I mean, could he have changed the world?
link |
01:58:12.720
Yeah, could he have done it like that?
link |
01:58:15.880
Probably not.
link |
01:58:17.320
Well, I can steel man those arguments.
link |
01:58:19.480
I listened to quite a few libertarians
link |
01:58:22.320
and you can push that to anarchists.
link |
01:58:25.760
You know, there's a lot of people that argue...
link |
01:58:28.880
So I actually talked to a professor at Columbia
link |
01:58:32.800
who actually argues that all drugs should be legalized
link |
01:58:35.160
and not at a philosophical level, political level,
link |
01:58:37.440
but the fact that all the negative consequences of drugs
link |
01:58:41.320
that people talk about actually have to do
link |
01:58:44.640
with other factors in your life.
link |
01:58:47.160
I would agree with that.
link |
01:58:48.240
And so that's, okay, but that's more like a argument
link |
01:58:51.600
about negative aspects of drugs.
link |
01:58:53.640
I think the ideology comes in where it's like,
link |
01:58:56.400
well, nobody should tell you what to do.
link |
01:58:59.280
You should have the responsibility of your own actions.
link |
01:59:02.960
Like the government or any other institution
link |
01:59:07.840
shouldn't be the rule setters,
link |
01:59:12.320
the constraints for how you live your life.
link |
01:59:14.560
And so I could see that argument being made
link |
01:59:17.160
and ultimately if you like create an open market for drugs,
link |
01:59:22.680
how that could build a better society,
link |
01:59:24.600
it might break down the outdated, the corrupt,
link |
01:59:28.160
the bureaucratic institutions.
link |
01:59:29.600
I mean, you can make that argument.
link |
01:59:31.880
There's an argument and let's be fair.
link |
01:59:33.640
I wanna be fair with it.
link |
01:59:34.560
I mean, did he change the world?
link |
01:59:38.160
We do have this whole thing called cryptocurrency.
link |
01:59:40.520
Yeah, in the long arc of history, perhaps.
link |
01:59:43.080
Yeah, we do have that.
link |
01:59:46.040
That's a biggie.
link |
01:59:48.080
And that might've been for it to take hold in society.
link |
01:59:50.720
Maybe the darker parts of society at first,
link |
01:59:52.960
maybe that was necessary.
link |
01:59:54.160
Right, I mean, maybe, we'll see how it pans out.
link |
01:59:57.320
Shadow Crew, we had this guy, Albert Gonzalez,
link |
02:00:02.320
Albert Gonzalez, that's the kid's name.
link |
02:00:04.520
We had, we were growing so big
link |
02:00:06.720
that I had to start farming things out.
link |
02:00:11.240
So the first thing I started farming,
link |
02:00:12.640
I instituted this review system,
link |
02:00:16.320
kind of establishing that trust mechanism
link |
02:00:18.320
even further for criminals to use.
link |
02:00:21.480
We needed somebody to take care of our tech aspects
link |
02:00:25.040
of the forum.
link |
02:00:25.880
So an associate of mine by the name of Kim Taylor,
link |
02:00:29.560
where we're looking for a forum techie,
link |
02:00:31.400
he comes to me one night and he's like,
link |
02:00:33.040
found our forum techie.
link |
02:00:34.200
I was like, who's that?
link |
02:00:35.040
And he's like, it's this kid.
link |
02:00:36.920
And I was like, is he any good?
link |
02:00:38.400
He's like, well, he knows the software.
link |
02:00:39.560
And I was like, okay, we'll just sign his ass on.
link |
02:00:43.120
He went by the screen name of Kumbajonny,
link |
02:00:45.600
was his screen name.
link |
02:00:46.800
And he starts selling credit cards after a while
link |
02:00:49.800
under a screen name of Scarface.
link |
02:00:51.600
And that CB1 breach where you're cashing out
link |
02:00:56.600
the track twos at ATMs, $40,000 a day.
link |
02:01:02.040
So Albert's in New Jersey one day, broad daylight,
link |
02:01:06.840
and stands at an ATM for 40 minutes, just standing there,
link |
02:01:11.960
feeding in one ATM card after another, pulling out cash,
link |
02:01:16.240
taking the 20s out, stuffing them in that backpack.
link |
02:01:19.600
Meanwhile, just across the street,
link |
02:01:21.320
a couple of cops just happened to be there.
link |
02:01:23.920
And they start noticing this kid just standing there.
link |
02:01:28.320
So 40 minutes, they watch this kid, 40 minutes.
link |
02:01:31.600
Finally, one cop looks at the other,
link |
02:01:33.560
let me see what's going on there.
link |
02:01:36.240
Walks over across the street, Albert's wearing a wig.
link |
02:01:39.240
He's got the disguise on, everything else like that.
link |
02:01:42.000
Ask him, kid, what are you doing?
link |
02:01:43.960
Albert falls apart.
link |
02:01:46.480
We didn't know Albert had been arrested.
link |
02:01:48.760
So Albert immediately goes in,
link |
02:01:51.200
I wanna work for the Secret Service.
link |
02:01:55.040
At that point in time, Secret Service,
link |
02:01:59.560
I referred to, and I wanna make sure I don't say,
link |
02:02:03.200
it's not like that anymore.
link |
02:02:04.720
But back then, they were fucking idiots, all right?
link |
02:02:07.920
They had no clue what was going on.
link |
02:02:09.520
So there was a competence issue
link |
02:02:10.960
that they were working through is one way to put it.
link |
02:02:12.760
That's a nice euphemism.
link |
02:02:15.200
So, or fucking idiots is another way to say it.
link |
02:02:19.000
So they're just not aware of the digital world.
link |
02:02:21.800
They had no clue, no clue.
link |
02:02:23.080
The way that Albert tells them how to catch us
link |
02:02:26.160
because they looked at him, how do we catch them?
link |
02:02:28.640
And Albert's like, Albert, I'm serious, I'm serious.
link |
02:02:32.440
So Albert's like, well, you could try a VPN.
link |
02:02:35.680
What's a VPN?
link |
02:02:37.480
So he explains it to them, they're like,
link |
02:02:39.840
that's a good idea.
link |
02:02:41.800
So I quit Shadow Crew.
link |
02:02:43.920
I was worried about all the news
link |
02:02:45.080
that was coming in and everything like that.
link |
02:02:46.200
I'm stealing 160K a week.
link |
02:02:47.840
I didn't know Albert had been arrested.
link |
02:02:51.400
I'm worried about being arrested.
link |
02:02:52.520
I know the writing's on the wall.
link |
02:02:54.520
And I'm like, I'm quitting.
link |
02:02:56.680
Where did you see the writing?
link |
02:02:58.400
The IPs that were coming in,
link |
02:03:00.400
the text messages about the Secret Service investigators
link |
02:03:03.320
I referred to.
link |
02:03:04.160
So the pressure's building.
link |
02:03:05.600
This is not gonna end well.
link |
02:03:06.840
This is going to be bad.
link |
02:03:09.080
So I announced my retirement of February 15th,
link |
02:03:13.560
I'm sorry, April 15th, 2004 is my retirement.
link |
02:03:18.200
I think that's the 2004.
link |
02:03:19.920
And I quit, I walk away.
link |
02:03:22.720
Well, Albert had been arrested.
link |
02:03:24.960
They cut him loose.
link |
02:03:26.200
No one knows he's been arrested.
link |
02:03:27.320
He comes back into Shadow Crew.
link |
02:03:29.120
I leave Kim Taylor at the same time.
link |
02:03:31.720
He's kind of on the run, which if you wanna know that story,
link |
02:03:34.520
that's a nightmare story in and of itself.
link |
02:03:36.880
So my second in charge, Kim Taylor, this guy,
link |
02:03:40.400
there was this guy named David, oh, what was his name?
link |
02:03:46.240
He was, El Mariachi was the guy's name.
link |
02:03:49.080
David Thomas.
link |
02:03:50.320
David, yeah, he was a film guy.
link |
02:03:53.440
Scarface.
link |
02:03:54.920
So El Mariachi, real name David Thomas,
link |
02:03:58.400
he's on the run out of Nebraska for check fraud.
link |
02:04:02.320
He comes to us on Shadow Crew telling us this sad story.
link |
02:04:06.280
We take up a collection for this guy.
link |
02:04:09.000
Send it to him, all right?
link |
02:04:10.600
I get him a job working with a low level carter
link |
02:04:13.800
trying to make him some money, all right?
link |
02:04:16.640
El Mariachi, Thomas does this for a few weeks,
link |
02:04:19.320
comes to me one day and he's like,
link |
02:04:20.480
man, I'm not making any money.
link |
02:04:22.080
I'm like, okay, let me see what I can do.
link |
02:04:23.440
Well, I had a Ukrainian guy by the name of Big Buyer.
link |
02:04:27.120
He, a real friend of mine.
link |
02:04:29.440
And I contacted him, I was like, look, man,
link |
02:04:30.920
I got a guy that wants to do some work.
link |
02:04:32.160
Can you help the guy out?
link |
02:04:33.000
And he's like, I got it.
link |
02:04:34.000
I was like, okay.
link |
02:04:35.120
So he sends Thomas enough money to go,
link |
02:04:38.480
Thomas is in Texas at that point,
link |
02:04:40.320
sends Thomas enough money to go from Texas
link |
02:04:43.360
to Issaquah, Washington and rent an office space, all right?
link |
02:04:48.560
So Thomas goes up there, rents his office space,
link |
02:04:51.000
him and his girlfriend rents an office space.
link |
02:04:54.360
And the plan is, is Big Buyer is going to place an order,
link |
02:04:59.920
get product sent, Mariachi is going to get the product,
link |
02:05:03.320
list it on eBay, cash out 50 50, easy enough, all right?
link |
02:05:07.120
So Big Buyer places an order.
link |
02:05:09.040
First order is outpost.com, $18,000.
link |
02:05:13.320
The largest order outpost.com had ever received
link |
02:05:16.320
at that point in time.
link |
02:05:18.480
Order goes through.
link |
02:05:19.760
It goes through still.
link |
02:05:20.640
Goes through, he gets the product, all right?
link |
02:05:23.640
Mariachi comes back, tells me,
link |
02:05:25.160
tells my second in charge, Kim Taylor.
link |
02:05:27.080
Kim Taylor at this point, I'm 33, 34.
link |
02:05:31.120
Kim Taylor's 46.
link |
02:05:32.520
He works at the Tattered Cover Bookstore
link |
02:05:35.000
in Denver, Colorado is where he works at this point.
link |
02:05:37.840
And he fancies himself Jason Bourne, all right?
link |
02:05:40.960
He's even got one of the screen names of Jason Bourne.
link |
02:05:43.720
So I'm like, all right, so Mariachi is telling us
link |
02:05:46.400
how much money he's making, everything else.
link |
02:05:48.320
I'm like, well, that's good.
link |
02:05:49.160
I'm glad you're all right.
link |
02:05:50.360
Kim contacts me and he's like, I want to go to Issaquah.
link |
02:05:53.400
And I was like, why?
link |
02:05:54.240
And he's like, to make some money.
link |
02:05:55.520
I'm like, you're making money.
link |
02:05:57.120
He's like, I want to go to Issaquah.
link |
02:05:58.640
I was like, all right, go, be careful.
link |
02:06:00.800
So he gets in the car, Saturn is what he's driving.
link |
02:06:04.560
He drives his little piece of Saturn
link |
02:06:06.880
all the way up to Issaquah.
link |
02:06:08.440
Gets there, you know, midnight.
link |
02:06:10.680
They party all night long
link |
02:06:12.520
because they've never met each other.
link |
02:06:14.240
They're just celebrating, partying, drinking,
link |
02:06:16.160
everything else like that.
link |
02:06:17.760
Meanwhile, Big Buyer has placed another order
link |
02:06:23.440
with Outpost.com, $17,000.
link |
02:06:27.200
The second largest order Outpost.com had ever received
link |
02:06:31.320
at that point in time.
link |
02:06:33.480
By this point in time, Outpost knows
link |
02:06:35.400
the first order was fraudulent.
link |
02:06:37.040
Guess where it's going?
link |
02:06:38.200
The exact same address the first order goes.
link |
02:06:41.200
So Outpost picks up the phone, calls Issaquah PD.
link |
02:06:44.200
Hey, we got a fraudster.
link |
02:06:46.560
Issaquah's like, would you mind sending some empty boxes?
link |
02:06:51.280
And Outpost is like, be happy to.
link |
02:06:54.440
So the rule was, is on credit card fraud,
link |
02:06:58.280
if you've got full account access,
link |
02:07:00.600
you place the order.
link |
02:07:01.920
The morning it's supposed to arrive,
link |
02:07:03.720
you sign into the bank account or the credit card account.
link |
02:07:06.240
If you can sign in, you go pick up your product.
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02:07:09.200
If you can't sign in, you go back to sleep that day.
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02:07:12.480
All right?
link |
02:07:13.760
Well, Big Buyer was the guy who placed the order.
link |
02:07:17.160
Mariachi and my second in charge are partying, all right?
link |
02:07:20.400
So they're supposed to contact Big Buyer, they don't.
link |
02:07:24.320
Meanwhile, Big Buyer is raising hell,
link |
02:07:26.920
getting up with me like, hey, where are the guys?
link |
02:07:31.200
I can't find them.
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02:07:32.320
They don't need to pick up this product.
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02:07:34.440
So I can't get in touch with them.
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02:07:36.360
They go down to pick up the,
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02:07:37.480
so Mariachi's got a Cadillac, old 70s Cadillac.
link |
02:07:41.480
He's got a Cadillac, pulls into the complex.
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02:07:45.640
Now Mariachi's driving,
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02:07:49.040
Kim Taylor's in the passenger seat,
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02:07:51.680
David Thomas's girlfriend's in the back seat.
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02:07:54.200
As they pull into the complex,
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02:07:55.880
going through the parking lot,
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02:07:57.600
Mariachi just happens to glance over and he sees a van
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02:08:00.640
with a guy sitting sideways in the van.
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02:08:03.000
And he looks at Kim Taylor and he's like,
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02:08:05.680
that's an undercover.
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02:08:07.840
And Kim's like, ah, it's fine.
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02:08:10.520
So they pull up to the office complex.
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02:08:13.600
Kim's like, I'll go in and get the packages.
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02:08:16.720
So he walks in, looks at the guy behind the counter.
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02:08:19.640
I believe you have some packages for us.
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02:08:21.240
Guy's like, one second.
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02:08:23.440
So he disappears around the wall,
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02:08:26.120
out pops the Issaquah PD, arrests Kim.
link |
02:08:29.760
David Thomas is in the car watching all this happen.
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02:08:32.480
He bugs out and they arrest him on the interstate
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02:08:37.000
where he has three fake driver's licenses in his wallet
link |
02:08:40.240
along with his real driver's license, another no, no,
link |
02:08:43.200
but they get him.
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02:08:44.200
So David Thomas had outstanding warrants out of Nebraska.
link |
02:08:48.160
We couldn't bond him out.
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02:08:50.160
Kim Taylor didn't have any warrants.
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02:08:52.320
So we bonded him out.
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02:08:53.840
My third in charge, kid, Seth Sanders was his name.
link |
02:09:00.000
He bonds him out, uses his girlfriend's account
link |
02:09:02.640
to bond him out.
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02:09:03.520
And I get Kim Taylor to go to Utah
link |
02:09:09.040
where another friend of mine agrees to house him,
link |
02:09:13.560
him and his wife.
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02:09:15.240
So I think everything's fine and all that.
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02:09:18.720
About three weeks later, this guy in Utah
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02:09:21.400
gets me on the phone.
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02:09:22.240
I'm like, hey, he's got to go.
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02:09:24.400
I'm like, what's going on?
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02:09:27.640
He's like, well, the only thing he's doing
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02:09:30.560
is popping ecstasy tablets every day, all day.
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02:09:33.840
And I'm like, seriously?
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02:09:35.200
He's like, yeah.
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02:09:36.040
I was like, okay, he's got to go.
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02:09:37.120
So we kick him out of there.
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02:09:38.880
By this point, I've got another crew that's coming through.
link |
02:09:40.640
I mean, I had all these crews running.
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02:09:42.440
Had another crew that's coming through Denver.
link |
02:09:45.380
Send Kim back to Denver to partner up with these guys.
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02:09:50.160
Kim gets these guys arrested.
link |
02:09:52.080
So by this point in time, I'm exasperated.
link |
02:09:54.800
I just want to throw my hands up in the air and walk away.
link |
02:09:57.960
So my retirement's coming up at the same time.
link |
02:10:00.720
So I'm like, fuck it, I'm done.
link |
02:10:03.680
So I tell everybody, the rest of the admins
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02:10:06.120
and the mods there, I'm like, this is what's going on.
link |
02:10:08.000
You guys need to watch out for this.
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02:10:09.480
We need to ban Kim, not let him back in.
link |
02:10:11.960
Be careful what's going on.
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02:10:13.400
I walk away.
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02:10:15.220
At the same time I walk away,
link |
02:10:17.860
Cumberjani, Albert Gonzalez, comes back into play.
link |
02:10:20.880
He sees everything that's going on.
link |
02:10:22.560
He uses that to his advantage.
link |
02:10:24.080
He starts banning everyone that's suspicious of him,
link |
02:10:26.880
sets up the VPN at the same time and says,
link |
02:10:29.280
hey, to make sure we're all secure,
link |
02:10:31.560
I need all transactions to go through this VPN.
link |
02:10:34.880
VPNs ran by the Secret Service.
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02:10:37.560
All right, Secret Service ends up,
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02:10:39.320
I think they ended up cataloging like $7 million
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02:10:41.560
worth of transactions over the next four or five months.
link |
02:10:45.160
Shadow Crew makes the front cover of Forbes, August, 2004.
link |
02:10:49.760
Headline, Who's Stealing Your Identity.
link |
02:10:52.600
October 26, 2004, United States Secret Service arrest,
link |
02:10:56.720
33 people, six countries, six hours.
link |
02:11:00.360
I was in Charleston, South Carolina when I saw it happen.
link |
02:11:02.860
And I'm like.
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02:11:03.700
So you're the one that got away.
link |
02:11:08.480
I'm the one public.
link |
02:11:09.320
There were a couple other guys that got away
link |
02:11:10.760
that they didn't publicly mention.
link |
02:11:12.480
One, his name was Tron.
link |
02:11:14.960
He was a zero.
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02:11:17.080
Yeah, exactly.
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02:11:18.160
But he went by the screen name Tron.
link |
02:11:21.000
He had access, almost unfettered access to Bank of America.
link |
02:11:27.240
So what happens is they identified the guy,
link |
02:11:29.600
Secret Service is in the air to go get him.
link |
02:11:31.800
They call the Ukrainian police.
link |
02:11:33.400
Hey, we're coming down to arrest this guy.
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02:11:34.840
Ukrainian cops are like, oh, come on down.
link |
02:11:38.000
So as soon as they got off the phone,
link |
02:11:39.320
Ukrainian cops get in the car, go down and tell Tron,
link |
02:11:42.380
hey, they're coming to get you.
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02:11:44.520
Yeah.
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02:11:45.360
So he bugs out down to South America
link |
02:11:47.800
and they don't catch him I think for six or seven years
link |
02:11:50.480
after that, something like that.
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02:11:51.320
But caught him eventually.
link |
02:11:52.680
Caught him eventually.
link |
02:11:53.520
Well, let me actually ask you on this point.
link |
02:11:55.720
You've said that if you do cyber crime eventually,
link |
02:11:59.680
it's not gonna end well.
link |
02:12:00.880
It does not end well.
link |
02:12:02.200
Why is that?
link |
02:12:03.760
So I don't wanna say that's because
link |
02:12:05.440
you're gonna be arrested because honestly,
link |
02:12:07.380
very few people are arrested, all right?
link |
02:12:10.200
But it doesn't end well because of the type of person
link |
02:12:13.720
that you become.
link |
02:12:14.800
You quoted me earlier, you lie to everybody around you.
link |
02:12:21.520
You lie to yourself, you lie to your friends,
link |
02:12:23.360
you lie to your family.
link |
02:12:24.200
Of course, you lie to your victims.
link |
02:12:25.760
You don't have any friends.
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02:12:27.800
You know, I went 20 years without friends.
link |
02:12:30.860
I had associates, I didn't have friends.
link |
02:12:33.520
And you can't truly trust anybody.
link |
02:12:35.280
You don't trust anybody.
link |
02:12:36.700
You don't trust anybody.
link |
02:12:37.680
You know, I had my wife, I was married for nine years.
link |
02:12:41.640
I lied to her every single day of those nine years.
link |
02:12:46.200
And it took her nine years to give up on me,
link |
02:12:49.720
to realize that I was that piece of shit.
link |
02:12:52.500
And she leaves at that point.
link |
02:12:55.480</