Kingpin: How One Hacker Took Over the Billion Dollar Cyber Crime Underground by Kevin Poulsen Read Free Book Online Page B

hats, like Max. A popular T-shirt at the conference summed up the mood: I MISS CRIME .
    Max shrugged off the FBI’s edict and began attending the parties and the talks. On the roster this year was a much-anticipated software release by the Cult of the Dead Cow. The cDc were the rock stars of the hacker world—literally: They recorded and performed music and infused their conference presentations with over-the-top theatrics that made them media darlings. At this Def Con the group was unleashing Back Orifice, a sophisticated remote-control program for Windows machines. If you could trick someone into running Back Orifice, you could access their files, see what was on their screen, and even look through their webcam. It was designed to embarrass Microsoft for the shoddy security in Windows 98.
    The crowd at the Back Orifice presentation was ecstatic, and Max found the energy infectious. But of more pragmatic interest to Max was a talk on the legalities of computer hacking by a San Francisco criminal defense attorney named Jennifer Granick. Granick opened her presentationby describing the recent landmark prosecution of a Bay Area hacker namedCarlos Salgado Jr., a thirty-six-year-old computer repairman who, more than any other hacker, represented the future of computer crime.
    From his room in his parents’ house in Daly City, a few miles south of San Francisco, Salgado had cracked a major technology company and stolen a database of eighty thousand credit card numbers, with names, ZIP codes, and expiration dates. Credit card numbers had been hacked before, but what Salgado did next assured him a place in the cybercrime history books. Using the handle “Smak,” he jumped into the #carding chat room on IRC and put the entire list up for sale.
    It was like offering a 747 for sale at a flea market. At the time, the online credit card fraud underground was a depressing bog of kids and small timers who’d barely advanced beyond the previous generation of fraudsters fishing receipt carbons from the Dumpsters behind the mall. Their typical deals were in the single digits, and their advice to one another was tainted by myth and idiocy. Much of the conversation unfolded in an open channel where anyone in law enforcement could log in and watch—the carders’ only security was the fact that nobody would bother.
    Remarkably, Salgado found a prospective buyer in #carding—a San Diego computer science student who’d been putting himself through college by counterfeiting credit cards, getting the account numbers from billing statements pilfered from the U.S. mail. The student had mob contacts who, he believed, would buy Smak’s entire stolen database for six figures.
    The deal went south when Salgado, looking to perform a little due diligence, hacked his customer’s ISP and poked through his files. When the student found out, he got mad and secretly began working with the FBI. On the morning of May 21, 1997, Salgado showed up at a meeting with his buyer at the smoking lounge at San Francisco International Airport, where he expected to trade a CD-ROM containing the database for a suitcase packed with $260,000 in cash. Instead, he was arrested by the San Francisco computer crime squad.
    The foiled plot was an eye-opener for the FBI: Salgado represented the first of a new breed of profit-oriented hacker, and he posed a threat to the future of e-commerce. Surveys showed that Web users were anxious about sending credit card numbers into the electronic ether—it was the number one thing holding them back from Internet purchasing. Now, after years of struggling to gain consumers’ trust and reward the faith of investors, e-commerce companies were starting to win over Wall Street. Less than two weeks before Salgado’s arrest, Amazon.com had launched its long-awaited initial public offering and ended the day $54 million richer.
    Salgado’s IPO was higher: The credit card companies determined the total spending limits on his eighty thousand