On October 25, Hanover Regional Court sentenced two men to nearly four years in prison on several counts of fraud. The men were accused of purchasing stolen credit cards from darknet marketplaces and using the cards to buy train tickets. The train tickets were then sold to individuals for less than the original ticket price.
Paul K. and his accomplice Peter P., according to the prosecutor, accumulated 350,000 euros by this scam. Paul K. recirculated 500 tickets, costing credit card companies, travel agencies, and train stations nearly a million euros worth of damage.
The defendants started in 2012 as a source of income they believed to be majorly untraceable. Tickets were sold to unsuspecting travellers and migrants who simply believed the stories behind the cheap tickets. The accused would often claim they had an uncle in the railway business who had access to cheap tickets. A similarly told tale was that the tickets were overstock from a travel agency.
As significant debts were amassed on a stolen credit card, the issuing bank would grow increasingly suspicious. Victims would dispute the charges and have their money reimbursed. The bank would subsequently file a claim against the web portal where the tickets were purchased. As this process cycled throughout Germany, cybercrime investigators noticed a recurring theme.
Martin Gold, a cybercrime specialist for the Federal Police, was heavily involved in the case. Police reports used “Martin Gold” as the agent’s name but his true identity remains unknown. His desk was stacked with reports of the ticket fraud, welt.de reported. “Initially, the railway reported 14,000 suspected cases at once,” Gold said. He knew what was going on.
Gold, with his team, hunted databases, looking for similarities and following cash flow. Suspects are “almost exclusively tech-savvy men, between 16 and 30 from different origins: German and Turks, blacks and North Africans, he said.”
Over the past year train companies had been reporting disturbing numbers of the same type of fraud. Nearly 100,000 individual cases were reported last year. The scheme has proven to be lucrative for some but for others it is a “newfound money laundering technique.”
During the trial, Paul spoke of obtaining the credit cards. The majority were purchased on various darknet marketplaces for two euros per card. Cards were bought in bulk, “usually ten sets of cards at once,” he said.
The tickets were sold on eBay classifieds, for the most part, he described. Buyers initially had to pay by sending cash through the mail. However, Paul and Peter shortly switched to anonymous digital payment services.
Gold said that this case resembled one in southwestern Germany where the scam is not uncommon. Most recently, a 26-year-old and an accomplice were arrested for the same crime. At the time of arrest, the 26-year-old possessed 100,000 euros, all obtained through this scheme.
The anonymous investigator spoke of the growing concern this mutated type of fraud presents to law enforcement. He said “Drug smugglers are using the method to launder money; tickets get distributed to migrants in large quantities. This poses a new problem: you can not follow the money trail.”