NEW JERSEY (BLOOMBERG) - US and South Korean authorities say they broke up one of the world's largest market for child pornography, a crime that is proliferating at a furious pace with the rise of cryptocurrency and encrypted online content.
The bust was revealed on Wednesday (Oct 16) as the US unsealed an indictment against Jong Woo Son, 23, who prosecutors say operated a Dark Web market that accepted Bitcoin and distributed more than one million sexually explicit videos involving children. Son, a South Korean national, is in custody there, where he was convicted.
Since agents shuttered the site in March 2018, the authorities have arrested more than 300 site users in 11 countries including the UK, Germany, Brazil, Saudi Arabia and the United Arab Emirates, and in more than two dozen US states. The site, which encouraged users to upload videos, included hundreds of thousands of illicit images not previously seen by the authorities.
The authorities say they rescued at least 23 minor victims in the US, UK and Spain who were being actively abused by the site's users.
Images of sexual exploitation have mushroomed since 2014, when the National Centre for Missing and Exploited Children received reports of 1.1 million incidents of child pornography. By last year, that number had risen to 18.4 million.
The Dark Web refers to encrypted online content that hides from traditional search engines. The anonymity of the Dark Web has fostered crimes like narcotics trafficking, money laundering and child pornography, prosecutors say. Cryptocurrency also has been cited in a wide range of crimes in which people seek to move money anonymously around the world.
Son's site, called Welcome to Video, contained more than 250,000 unique videos. Of those, 45 per cent contained new images that were previously unknown, according to the National Centre for Missing and Exploited Children.
Users could join the site free with a user name and password, allowing them to download videos, according to court records involving a user charged in Washington. They earned "points" by uploading videos and referring new users. They could buy a "VIP" account that allowed unlimited downloads for six months if they exchanged bitcoin valued at US$328 (S$450) in March 2018. The site was run out of Son's bedroom, the records show.
Son was indicted under seal in Washington in August 2018 on child pornography charges, according to court records.
Agents from the Internal Revenue Service's Criminal Investigation Division determined the location of the Dark Web server in South Korea, identified Son and found the physical location of the website, according to Don Fort, chief of the division. They also unmasked users hiding behind bitcoin transactions, Fort said.
"Our agency's ability to analyse the blockchain and deanonymise bitcoin transactions allowed for the identification of hundreds of predators around the world," Fort said.
