The FBI silently operated an encrypted chat platform for years to catch criminal gangs

Shawn Knight

Posts: 14,046   +152
Staff member
What just happened? A joint sting operating involving law enforcement agencies from several countries has resulted in the arrest of hundreds of suspects and the seizure of tons of drugs, more than 100 weapons and nearly $45 million in cash – and that’s just in Australia.

In 2018, the CEO of a company called Phantom Secure was taken into custody. Phantom Secure specialized in providing “hardened encrypted devices” that were sold exclusively to members of criminal organizations, allowing them to communicate with business associates without law enforcement being able to surveil their chats.

Following the CEO’s arrest, the FBI recruited a confidential human source (CHS) that had been developing a “next-gen” encrypted communications product meant to compete with services like Phantom Secure. The device, dubbed Anom, was supplied by the source to the FBI and put into circulation within the criminal underworld.

Anom devices retailed for as much as $2,000 each and could only send secure, encrypted messages in a closed-loop environment. Due to their cost and limited functionality, they weren’t really used by privacy-minded individuals but were a must-have for organized crime types.

Because they were seeded from an insider and other criminals used and vouched for them, they became somewhat of a hot commodity over time.

What the criminals didn’t know is that law enforcement had built a master key into the encryption system that was attached to each message, allowing police to decrypt and store messages as they were transmitted.

The sting operation went on for a few years and involved numerous law enforcement agencies including the FBI, the DEA, Europol and the Australian Federal Police. In its press release, the AFP said 224 offenders have been arrested on 526 charges in Australia since June 7.

“3.7 tonnes of drugs, 104 number of weapons, $44,934,457 million in cash, and assets expected to run into the millions of dollars, have been seized under Operation Ironside,” the AFP said.

The FBI said more than 12,000 devices were supplied worldwide to hundreds of criminal organizations, but has not yet commented on how many arrests it has made.

Image credit Motortion Films

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Posts: 682   +1,081
So it's illegal to make secure devices?
Why was the CEO arrested?
Five execs of the company were arrested initially because they sold the messaging devices exclusively to transnational criminal organizations. The investigation showed these devices were not used by privacy minded individuals because of their limited functionality (they only work in a closed-loop environment) and high price of each device. They were charged with violating RICO by aiding and abetting the distribution of cocaine. Seven months later the CEO pleaded guilty.

If you're interested in more, it's the first link in the article starting on page 5

Aus spot

Posts: 129   +111
AN0N. Not anon.

First distributed by an australian dumb *** to his criminal mates after an Australian undercover cop introduced him to it. We dont have laws that might have caused issues if the fbi introduced it.

It's a great read and movie could be good.

Darth Shiv

Posts: 2,271   +827
Luddite criminal master minds would be laughing their literal donkey's off.
Errmmm... tech literates would too... this is such an obvious attack vector... you have to be a complete ***** to not expect this could happen if you have a black box encryption product.


Posts: 121   +81
These "stings" or simply trojan horses provided a treasure of info for lots of police departments, and gave a clear sight to for example world wide drugs shipping(s).

Criminals are dumb, really. If anyone believes they to this day operate safe and anonymous think twice. NSA is all in cracking encryption and they do have the (serious) hardware and budget for that. Your not safe using electronic equipment.


Posts: 2,008   +1,202
So if any other country or China does something like this, people go batshit crazy, when US does it, no one gives a crap?
Usually because when China does it, its against some random population of 'others' or political dissidents. When the US does it (and it wasn't just the US here; looks to be every North American country, most European countries, and Australia), it is targeting organized crime. Drug running, murder for hire, racketeering, etc.

I'd be willing to bet that most, if not all, of the people arrested were already on the Entities List, so that alone made doing business with them illegal (which is probably how they were able to get the first guy, at least in part)

Darth Shiv

Posts: 2,271   +827
He is about to hear it for a long time.
18 counts of Espionage. He is a Gold Star criminal.
He did not perform any espionage. He published information others obtained AFTER responsible redaction. He published war crimes. Interesting the war criminals aren't charged for THEIR crimes?


Posts: 2,008   +1,202
He did not perform any espionage. He published information others obtained AFTER responsible redaction. He published war crimes. Interesting the war criminals aren't charged for THEIR crimes?
1. Releasing or receiving classified intelligence you lack the clearance or need-to-know for is a violation of the espionage act. Now, no journalist has ever been prosecuted under this act, but Snowden was not and is not a credentialed journalist.
2. He published constitutional violations, not war crimes. You might be thinking of Chelsea Manning on that one. She leaked those diplomatic cables, some of which detailed allegations of war crimes.


Posts: 7,487   +6,290
Interesting that they went public with this, though, I suspect that they were unable to avoid it after the arrests. I wonder if the FBI or other agency will ever be successful with this type of operation again. Criminal elements will probably now forever be on their guard for something similar.