A 23-year-old man, Rui-Siang Lin, known online as “Pharoah,” was arrested at New York’s John F. Kennedy Airport on May 18. Lin has been charged with owning, operating, and profiting from Incognito Market, a dark web narcotics marketplace that facilitated over $100 million in illicit transactions. The FBI traced cryptocurrency transfers that led to Lin’s identification.
Details of the Case
Lin appeared in federal court on May 20. He allegedly ran Incognito Market for nearly four years, during which the platform facilitated the sale of various drugs, including cocaine, LSD, MDMA, and prescription amphetamines like Adderall, using Bitcoin (BTC) and Monero (XMR) as payment methods.
Incognito Market, accessible via the Tor web browser, required buyers and vendors to use its crypto services. The platform skimmed 5% of each purchase and offered an escrow service. The market was shut down in March, coinciding with a reported exit scam that stole millions of dollars in BTC and XMR from customers.
Charges and Potential Sentences
Lin faces several charges, including engaging in a criminal enterprise, narcotics conspiracy, conspiracy to sell misbranded medication, and money laundering. If convicted, he faces a mandatory life sentence for the criminal enterprise charge, with the narcotics conspiracy charge carrying a maximum life sentence.
FBI’s Investigation and Crypto Tracing
The FBI traced crypto transfers from Incognito Market to a centralized crypto exchange account in Lin’s name. According to FBI task force officer Mark Rubens, a crypto wallet controlled by Lin received funds from Incognito Market’s wallet, which were then sent to an exchange account registered under Lin’s name. Rubens detailed at least four transfers, showing BTC derived from Incognito Market being exchanged for XMR and then deposited into Lin’s exchange account.
The exchange provided the FBI with Lin’s Taiwanese driver’s license, email address, and phone number used to open the account. These details were linked to a Namecheap account used to purchase a domain promoting Incognito Market.
Financial Impact
The FBI noted that deposits to Lin’s exchange account grew significantly with the market’s operations, from around $63,000 in 2021 to nearly $4.2 million in 2023. A second unnamed exchange account saw $4.5 million deposited between July and November of the previous year.
Conclusion
The arrest and charges against Rui-Siang Lin highlight the ongoing efforts of law enforcement agencies to combat illegal activities on the dark web. The case underscores the importance of tracking cryptocurrency transactions to uncover the identities of individuals involved in illicit operations.