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Cyber-Terrorists Holding Detroit Database Hostage, Demanding Ransom of 2,000 Bitcoins

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COMMENT: Highlighting the perils of wikiculture and underscoring the utility of Bitcoin for various types of criminal activity, we note that cyberattackers have frozen a key database for bankruptcy-afflicted Detroit.

In return, they are demanding 2,000 Bitcoins as ransom–no doubt because of the relatively opaque and untraceable nature of the digital currency.

Represented as a vehicle for “liberation” from the banksters, Bitcoin has its roots in the Austrian school of economics and cyber-libertarian fascism.

To flesh out your understanding, please access our programs about Bitcoin: FTR #’s 760764770, 785.

“Cyberattackers Freeze Detroit Database, Demand 2,000 Bitcoin Ransom” by Michael Grass; govexec.com; 11/17/2014.

. . . . The latest challenge for Detroit’s leaders? Cyberattackers who have been holding a city database for ransom for 2,000 bitcoins since April.

During a speech at the North American International Cyber Summit being hosted in the Motor City on Monday, Mayor Mike Duggan disclosed the news of the cyberattack, The Detroit News reports. But the city won’t pay the bitcoin ransom—which is roughly valued at $803,500 according the current bitcoin valuation—because the now-frozen database wasn’t being used by the city.

The mayor said the ransom was a good “warning sign” that the resource-strapped city needs to do more to make sure its information systems are secure, according to the News. Duggan also noted that an individual involved in the city’s bankruptcy proceedings was the victim of a cyberattack that involved a “significant” amount of money being taken from their personal checking account.

Other speakers at the North American International Cyber Summit included Michigan Gov. Rick Snyder, Michigan Chief Information Officer David Behen, former U.S. Homeland Security Secretary Michael Chertoff and National Association of State Chief Information Officers Executive Director Doug Robinson.

Snyder, according to the Detroit Free Press, announced an expansion of the volunteer Michigan Cyber Civilian Corps, which can “be called on in an attack to come together in a team.” The state initially brought that group together in 2013.

 

Discussion

One comment for “Cyber-Terrorists Holding Detroit Database Hostage, Demanding Ransom of 2,000 Bitcoins”

  1. Federal agents charged with stealing digital currency during probe of black market in Internet

    http://www.usnews.com/news/business/articles/2015/03/30/2-us-agents-charged-with-fraud-during-silk-road-inquiry

    By KRISTIN J. BENDER and PAUL ELIAS, Associated Press

    SAN FRANCISCO (AP) — Two former federal agents were charged with fraud in the theft of digital currency during an investigation into an online black market known as Silk Road that let users buy and sell drugs and other illegal items, authorities said Monday.

    Former U.S. Secret Service special agent Shaun W. Bridges, 32, of Laurel, Maryland, appeared in federal court in San Francisco but didn’t enter a plea.

    He has been charged with wire fraud and money laundering. He was later released on $500,000 unsecured bond. His attorney, Steven Levin, declined to comment.

    Bridges is accused of diverting more than $800,000 in digital currency to his personal account after gaining control of the funds during the Silk Road investigation.

    The complaint alleges that Bridges placed the assets into a now-defunct digital currency exchange in Japan then wired funds into one of his personal investment accounts in the U.S.

    The criminal complaint was filed in the U.S. District Court in San Francisco on Wednesday and unsealed Monday.

    Carl M. Force, 46, of Baltimore, a former special agent with the Drug Enforcement Administration, also has been charged in the case. He was expected to make an appearance in court Monday and remain in custody pending a detention hearing on Thursday. His attorney Ivan Bates did not immediately returns calls for comment.

    Force worked undercover and was tasked with establishing communications with a target of the investigation, Ross William Ulbricht, who was convicted of seven drug and conspiracy charges in February.

    Ulbricht was accused of creating the multimillion-dollar marketplace for illegal drugs and other contraband and adopting the alias Dread Pirate Roberts, a character from the movie “Princess Bride.”

    The website promised its buyers and sellers anonymity by using encryption and bitcoins.

    Force is charged with wire fraud, theft of government property, money laundering and conflict of interest.

    The complaint alleges that Force used fake online personas and engaged in complex bitcoin transactions to steal from the government and Ulbricbht.

    Investigators say Force solicited and received digital currency as part of the investigation but failed to report the funds and instead transferred the currency to his personal account. In one such transaction, Force sold information about the government’s investigation to Ulbricht, authorities say.

    The complaint also alleges that Force invested in and worked for a digital currency exchange company while still employed by the DEA. He directed the company to freeze a customer’s account and then transferred the account funds to his personal account, it says.

    Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

    Posted by participo | March 31, 2015, 12:43 pm

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