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The Great Cyberheist

kdawson posted more than 3 years ago | from the meelions-and-meelions dept.

Businesses 57

theodp writes "In this week's cover story, the NY Times Magazine delves into the mind of Albert Gonzalez, the hacker who is currently doing time (the longest sentence ever handed down for computer crime in the US) for masterminding attacks on the nation's leading retailers, reportedly costing TJ Maxx, Heartland, and other victimized companies more than $400 million. And that may just be the tip of the iceberg. 'The majority of the stuff I hacked was never brought into public light,' said one of Gonzalez's partners-in-crime. Another claims there 'were major chains and big hacks that would dwarf TJX. I'm just waiting for them to indict us for the rest of them.' Online fraud is still rampant in the US, but statistics show a major drop in 2009 from previous years when Gonzalez was active. While reportedly not a gifted programmer, even the Feds that Gonzalez two-timed admired his ingenuity, likening him to top CEOs. When asked how Gonzalez rated among criminal hackers, a prosecutor replied: 'As a leader? Unparalleled. Unparalleled in his ability to coordinate contacts and continents and expertise. Unparalleled in that he didn't just get a hack done — he got a hack done, he got the exfiltration of the data done, he got the laundering of the funds done. He was a five-tool player.' Accounting for time served and good behavior, Gonzalez is expected to get out of prison in 2025." Last June Rolling Stone ran a long profile of Albert Gonzalez written by Sabrina Rubin Erdely; they have dusted it off now that producer Eric Eisner has embarked on the development of a feature film based on Erdely's piece.

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from the skool of bad journalism :) (4, Insightful)

viralMeme (1461143) | more than 3 years ago | (#34215386)

Yet another 'journalist who thinks he's the new Tom Wolfe :)

Biggest Cybercrime of All Time

"Albert Gonzalez remained focused on business — checking his laptop constantly, keeping tabs on the rogue operators he employed in Turkey and Latvia and China, pushing, haranguing, issuing orders into his cellphone in a steady voice. "Let's see if this Russian asshole has what I need," he'd say calmly. Then he would help himself to glass plates of powder, each thoughtfully cut into letters for easy identification: "E" for Ecstasy, "C" for coke" link []

"Dude," he wailed, "I can't fucking read!"

Dude, you can't write :)

Re:from the skool of bad journalism :) (5, Funny)

devbox (1919724) | more than 3 years ago | (#34215452)

I loved this part

Before long, he discovered Internet Relay Chat, a web forum popular with hackers who discussed the how-tos of breaching Internet security at its highest levels.

Re:from the skool of bad journalism :) (1)

bobdotorg (598873) | more than 3 years ago | (#34215792)

Hey: Eye are see is where those hackers refine their "sequel attacks", because apparently the first attack didn't fully tell the story.

Re:from the skool of bad journalism :) (0)

Anonymous Coward | more than 3 years ago | (#34216312)

Good, because those prequel attacks are awful. Lucas should have stopped after episode VI.

Re:from the skool of bad journalism :) (0)

Anonymous Coward | more than 3 years ago | (#34216466)

nice Critical research failure []

Re:from the skool of bad journalism :) (0, Offtopic)

Nailer235 (1822054) | more than 3 years ago | (#34215480)

Even the summary is written in Engrish. "While reportedly not a gifted programmer, even the Feds that Gonzalez two-timed admired his ingenuity, likening him to top CEOs. " What?

Re:from the skool of bad journalism :) (0)

Anonymous Coward | more than 3 years ago | (#34215748)

Maybe you need to learn how to parse more complex English sentences - makes complete sense to me.

1. He was not considered a gifted programmer, but that was not a hindrance for him in his "enterprise" due to the next point.

2. The Feds that he two-timed could admire his ingenuity in spite of being "two-timed", and they compared ("likened") him to top CEO's (apparently due to his ability to manage this complex operation).

Does that help?

Re:from the skool of bad journalism :) (0)

Anonymous Coward | more than 3 years ago | (#34216098)

Not at all. In what way was there "two-timing" going on ? This usually means that your girlfriend/boyfriend is sucking a second dick. What does it mean when you're the FBI ?

Re:from the skool of bad journalism :) (1)

sirrunsalot (1575073) | more than 3 years ago | (#34216776)

verb [trans.] informal
deceive or be unfaithful to (a lover or spouse)

The parentheses indicate common usage, but the meaning seems perfectly clear to me in this context. It is more fun to feign ignorance though.

And speaking of feigning ignorance, I thought maybe we were going to delve in to the mind of Alberto Gonzalez when I first glanced at the summary. Now that would be a story. But then I remembered personally reading about and discussing this Albert Gonzalez on a previous occasion. What did we talk about? I didn't directly converse about Gonzalez. I believe it was a spokesperson that discussed him. When? I don't recall. I told you. I remember talking about the other Albert Gonzalez. We went back and clarified the difference between the two. I don't know the specific content of the conversation, but I remember that it was about Albert Gonzalez. I stand by what I said to the committee. I don't know exactly... Well, I don't have a record of everything that was said here. I'll have to find out and get back to you.

Re:from the skool of bad journalism :) (1)

angiasaa (758006) | more than 3 years ago | (#34216828)

Is it not obvious? :) He was sucking the KGB behind the FBI's back.

Okai, that was in lousy taste, I know.. :| But you're right, I can't imagine what two-timing could have happened. And if there really was some kind of two-timing going on, the writer obviously did not have the sense to mention it in TFA for us. What joy in incompetence, yeah!?

Re:from the skool of bad journalism :) (1)

JWSmythe (446288) | more than 3 years ago | (#34217644)

Everyone knows that the KGB had hot russian chicks as their spies. Haven't you ever watched a James Bond movie? :)

    Well, it's shown in reality too. Some are: Anna Chapman, Anna Fermanova, Patricia Mills, Krystyna Skarbek, Josephine Baker, and Violette Szabo. They don't exactly resemble the Bond girls though. I'm still trying to figure out how to convince a hot russian spy chick that I have secrets worth seducing. It's not that I'd give them up, but the seduction is always fun. :)


Re:from the skool of bad journalism :) (1)

Whiteox (919863) | more than 3 years ago | (#34219150)

POO (Point of Order): Violette Szabo is Hungarian, not Russian.

Re:from the skool of bad journalism :) (1)

angiasaa (758006) | more than 3 years ago | (#34220548)

We're assuming things here.. I'm sure there are some non-homophobic members on both sides. :-D

But I rhyme with your thoughts. :) I'm sure I have secrets worth seducing out of me too. I just have to find some Russian chicks to work on me before I expose myself.

Re:from the skool of bad journalism :) (1)

Doggabone (1025394) | more than 3 years ago | (#34220626)

And if there really was some kind of two-timing going on, the writer obviously did not have the sense to mention it in TFA for us. What joy in incompetence, yeah!?

Excerpts from the article ...

"After a couple of interviews, Gonzalez agreed to help the government so he could avoid prosecution ... After aiding another investigation, he became a paid informant in the Secret Service field office in Miami in early 2006. Agent Michael was transferred to Miami, and he worked with Gonzalez on a series of investigations on which Gonzalez did such a good job that the agency asked him to speak at seminars and conferences ... As far as the agency knew, that’s all he was doing. “It seemed he was trying to do the right thing,” Agent Michael said... He wasn’t. Over the course of several years, during much of which he worked for the government, Gonzalez and his crew of hackers and other affiliates gained access to roughly 180 million payment-card accounts from the customer databases of some of the most well known corporations in America ..."

The two-timing is spelled out in just over the first page.

Re:from the skool of bad journalism :) (1)

Doggabone (1025394) | more than 3 years ago | (#34220640)

Ah, I'm quoting the Times and missed the point ... the Rolling Stone piece is certainly crap.

Re:from the skool of bad journalism :) (1)

osvenskan (1446645) | more than 3 years ago | (#34216888)

To be fair you should note that your quote is from the Rolling Stone article. The NY Times magazine article (first link in TFS) is quite good.

what great cyberheist ? (3, Informative)

Anonymous Coward | more than 3 years ago | (#34215442)

The hack consisted of accessing wireless POS terminals from the car park and then going on to access the internal CC database for over eighteen months, without anyone noticing. They only took action when the banks phones them up and asked about all the fraudelent activity out TJX stores.

"TJX admit that 45.7 million credit and debit cards was stolen from the company in a computer data security breach over an 18-month period" link []

Re:what great cyberheist ? (2, Insightful)

hedwards (940851) | more than 3 years ago | (#34215492)

I'm wondering at what point a retailer ought to be responsible for the breach. It seems to me that whatever the consequences of that sort of irresponsibility is, that it's not enough. There's absolutely no reason why they need to have an internal CC database. They could just as easily hash the CC information and compare that with a stored hash.

Re:what great cyberheist ? (1)

Florian Weimer (88405) | more than 3 years ago | (#34215530)

There is not enough entropy in credit card numbers to make hashing a serious obstacle.

Re:what great cyberheist ? (0)

Anonymous Coward | more than 3 years ago | (#34215628)

Still better than not hashing them, especially given how little additional work is required to do so.

Re:what great cyberheist ? (1)

Corbets (169101) | more than 3 years ago | (#34215888)

Still better than not hashing them, especially given how little additional work is required to do so.

No, because "so little work" involves changing credit card processing terminals around the world. For that kind of cost/effort, it better be a good solution.

Re:what great cyberheist ? (1)

bjourne (1034822) | more than 3 years ago | (#34215920)

Is it even legal to store credit card info when you don't have any use for it? In other countries there are laws against retailers storing CC info because of the huge risks involved. They don't need the info after the purchase is made and a single rogue employee can cause havoc without any hacking involved.

Re:what great cyberheist ? (0)

Anonymous Coward | more than 3 years ago | (#34216450)

This could all be easily solved if the US got off of its lazy fat ass and entered into the banking 20th century, like the rest of the civilized world was in say, 20 or 30 years ago.

What is the obsession with using credit cards all the time? I have a credit card but I don't use it more than a handful of times a year, if that. Suer, it's a nice thing to have, especially if say, the end of month is nearing and you are a bit tight on funds and really need to make this purchase or whatnot, but for everything else in day to day life I use a debit card, and couldn't care less if anyone got a hold of it's number, because they can do jack shit with it.

Even for online shopping there are massively better alternatives -- my bank allows me to create virtual credit cards on the fly, with the expiration date set to the present month and a limit of my chosing (which I usually set at the exact amount of whatever I'm buying). Hell, you can easily have paypal without a credit card, and pretty much anywhere that matters online accepts paypal.

Seriously, America's love affair with credit cards flummoxes me. I can see mostly downsides with very few, if any, upsides.

Re:what great cyberheist ? (0)

Anonymous Coward | more than 3 years ago | (#34227386)

do you mind if I ask what bank allows you to create virtual credit cards?


Re:what great cyberheist ? (0)

Anonymous Coward | more than 3 years ago | (#34216756)

It is legal, at least in the US. However, if there is any breach the merchant is responsible for the cost of the breach including the forensic investigation. For a merchant to limit their liability, it is ideal to not store CC's at all. Generally the business case for storing them must outweigh the cost of increasing security. See: PCI DSS

Re:what great cyberheist ? (1)

evilviper (135110) | more than 3 years ago | (#34223250)

A) You may just be over-generalizing, but yes, full CC#s do need to be stored for a decent bit of time to handle any number of order processing issues that may occur.

B) Even if you as a company may not want to keep CC#s lying around forever, your lawyers may well tell you it is required. Though I dont deal with the lawyers myself and cant give specifics, I can tell you that my employer treats CC info the same as all other business info that might possibly be needed by the IRS up to 7 years down the line...

C) PCI-DSS is the (publically available) standard that the CC companies set on businesses who need to process credit cards. They can pretty well dictate any terms they want. However, they most certainly arent strict by any stretch. They do not set a length of time after which you must erase full CC#s from your records. They do, however, dictate that any such info being stored must be protected, essentially requiring encryption, and dictating annual key changes as well.

D) If retailers aren't abiding by PCI-DSS standards, and passing their audits, they're liable to get their right to process CCs revoked, and, may be open to lawsuits by the CC companies. If the standards aren't tough enought, they can easily add more restrictions that retailers must follow. However, if CC companies wish to choose to allow retailers to be in violation, and choose not to improve their security standards, then they've decided it's better to take these kind of losses, and that's hard to argue with... There's a question of a moral hazard, as letting criminals make billions is a bad thing in itself, and how much money police and courts are wasting on prosecuting criminals that need not have been able to get anything in the first place, but if they've decided lack of security is more profitable, they deserve to pay out every fraudulent dollar, and we shouldn't give it a second thought, until they start asking to be bailed out...

Re:what great cyberheist ? (1)

TheKidWho (705796) | more than 3 years ago | (#34215556)

Typical /. goon, "Pshh I could do that with one hand and blindfolded!"

Re:what great cyberheist ? (1)

TheLink (130905) | more than 3 years ago | (#34216798)

Re:what great cyberheist ? (1)

yuhong (1378501) | more than 3 years ago | (#34217118)

The hack consisted of accessing wireless POS terminals from the car park

By cracking WEP, BTW. Any other real-world incident that involved WEP cracking you have encountered? BTW, I found this paper on "IVs to Skip for Immunizing WEP against FMS Attack [] " from 2008, which seems to be a better attempt at skipping weak IVs than before. Of course it is still better to use WPA if you can.

the long tradition of bigging up criminals (5, Interesting)

petes_PoV (912422) | more than 3 years ago | (#34215554)

All media reports of (caught) cyber-criminals (or just plain "criminals" as they actually are) stresses how talented, or brilliant or "mastermind" they were. None of them were simply petty crooks that just happened to use a comuter rather than a jemmy as their tool of trade.

You could be forgiven for thinking that the world of the cyber-criminal is wholly populated by geniuses who have "gone bad", or the sorts of people that James Bond regularly vanquishes. Where are all the averagely intelligent, nondescript, stupid-but-lucky criminals who stalk the world of online, as they do the ordinary underworld?

The answer, I suspect, is that they're the very same people who are described above, but who's skills are exaggerated by police forces all over the world in an attempt at self-aggrandisement. To make their own lucky breaks appear to be much more significant than they actually were. Just as anglers everywhere have stories about the "massive" catches they made when no-one else was around I reckon the police are pursuing the same policy to try and convince the public that they, too are masterminds. Hmmm.

Re:the long tradition of bigging up criminals (0)

Anonymous Coward | more than 3 years ago | (#34215894)

I believe that happens everywhere. I laughed when a coworker talked up his shitty platform until I heard our boss do the same.

I have to self-aggrandize to be judged fairly.

Re:the long tradition of bigging up criminals (0)

Anonymous Coward | more than 3 years ago | (#34215940)

Most criminals are retarded, and I mean that in the technical rather than the pejorative sense: IQs well below 80. In a lot of cases its because their mothers drank or did drugs or did other bad things while pregnant. My mother is a teacher in a prison, so I know whereof I speak. They then exacerbate the problem by doing brain-killing things like sniffing paint. These types of people constitute the vast majority of criminals these days. (It may have been true 30 years ago too, but I don't know.)

As the saying goes, you don't end up in prison because you're smart. Smart people either live more-or-less honestly or they are good enough at crime not to get caught. We've all probably thought about it before: "How could I rob this bank and never get caught?" The answer is that you probably could, and it would probably be pretty easy. Get a gun well in advance of the crime, don't use the gun, rob a bank that's nowhere near you, and get the hell out of there as soon as possible, even if it means leaving money behind. Then don't spend all your "profits" all at once, but instead spread it out over several months. It would basically take a run of terrible luck to get caught if you did it that way. But see, we can plan that out because we're not stupid. Most criminals are mentally incapable of constructing (or even following) a plan like that. They are driven almost entirely by the need for instant gratification. "I need money, so I'm going to rob a bank." They often go to banks where they've been before or will be again, they spend all their cash at once, they brag to their buddies about what they've done, etc etc etc. They just have no impulse control or planning abilities.

So that's the point of comparison. "Cybercriminals" -- the kinds who don't just lift a bunch of credit card numbers and then get caught two weeks later -- may only have 110 IQs, but by comparison to the average criminal, that makes them bloody geniuses.

Re:the long tradition of bigging up criminals (1)

misexistentialist (1537887) | more than 3 years ago | (#34216586)

Stupidity is commoner than you think, judging from your bank robbery plan.

Re:the long tradition of bigging up criminals (1)

JWSmythe (446288) | more than 3 years ago | (#34217720)

    I agree.

    I've had frank conversations with folks that work in banks. I've also had to cash some large checks, which is frequently a nightmare to pull off. It's not all in verification, that's easy. They call the issuer, the issuer verifies it. The hard part is for them to come up with the funds. I've been left waiting for up to an hour for the armored truck to arrive and drop off more cash, so I could get mine. Teller drawers rarely have enough to make a bank robbery a valid risk. You may walk off with a few hundred. If you're lucky, a few thousand. Once in a great while the bank wasn't following it's written procedures, and someone will walk out with a bunch of cash, but that's rare. Most likely, a bank robber will walk out with the few hundred, and an exploding dye pack, and get nabbed within a block of the bank. Not all cops do what is shown on TV. They *WANT* you to come outside. You're now without any sort of defensible area, and without any potential hostages.

    He was right in one thing though, most people who do commit those types of crimes are stupid. Then they get greedy. If they get away with a couple, then they'll start getting sloppy, and they may as well put on their own handcuffs and climb into the back of the patrol car.

    Risk evaluation for criminal activity is fun to do. Well, as a hobby. Trying to figure out the "perfect" crime, and then trying to pull it off means you are dumb.

    I'll never commit any sort of crime like that, because I know perfectly well that even if I did formulate the "perfect" plan, the random event will get me caught. It'd be something stupid like, getting in and out undetected, and getting a flat tire a few miles down the road. Despite the fact that cops are never friendly enough to stop and help when you're actually stuck, it would be almost guaranteed that one would stop to help me, and pull the probable cause card for searching me and my vehicle, and voila, I'm in jail. No thanks. :)

Re:the long tradition of bigging up criminals (0)

Anonymous Coward | more than 3 years ago | (#34218358)

That is why you don't hold the cash ON YOU when you leave. You stash it asap nearby the second you are around the corner and no one is looking and come back later. Then leave slowly. But robbing a bank is stupid as you said. Too risky.

Re:the long tradition of bigging up criminals (1)

indiechild (541156) | more than 3 years ago | (#34219446)

What an idiotic thing to do. Stash it when you leave, and then come back later when all the cops are swarming all over the place? Or come back later only to find that someone else has already taken your loot?

Re:the long tradition of bigging up criminals (1)

indiechild (541156) | more than 3 years ago | (#34219430)

Agreed. Bankrobbers are a breed of low-intelligence, violent psychopaths. Robbery is a high risk crime (to the perpetrator as well as the victims), so a clever criminal would not engage in such activities. The return usually isn't worth it when judged against the risk.

Re:the long tradition of bigging up criminals (1)

tehcyder (746570) | more than 3 years ago | (#34229412)

So your ingenious bank-robbery plan is to get a gun, run out with some cash and not get caught?

It's almost unbelievable that no-one's thought of that before.

Re:the long tradition of bigging up criminals (0)

Anonymous Coward | more than 3 years ago | (#34216246)

That's a little harsh. Nearly everyone especially techo-geeks exaggerate their accomplishments.

Re:the long tradition of bigging up criminals (1)

Nikker (749551) | more than 3 years ago | (#34216606)

Ha I just hacked the NSA,CIA,FBI and CSIS using RFC2594 with a DBSA(distribution of bird seed attack) and that was while I was posting to Slashdot, Twitter, Facebook and writing an advanced stock market algorithm in BrainFuck.

Re:the long tradition of bigging up criminals (1)

petes_PoV (912422) | more than 3 years ago | (#34217288)

True, but in the case of cyber-criminals, finding themselves described as brilliant or genius or whatever is more of an encouragement than a criticism. For example, the question "Which is the bigger insult - being called ugly or being called stupid?" Most geeks would say that stupidity was the bigger insult, whereas most ordinary people would go with ugly.

By exaggerating the very trait that cyber-criminals value in themselves (i.e. their intelligence, cunning, abilities etc.) all thepolice are doing is rewarding them - the jail term notwithstanding. Personally I think a bigger deterrent for cyber-criminals would be if the police publicly ridiculed their efforts and humiliated them. For example: "This was a particularly inept attack that had FAIL written all over it. My 6 year-old writes better hacks than these people and their idea was just so lame I can't believe anyone with more intelligence than a tomato plant would ever think they could get away with it.". However, that then begs the question: "well why did it take yo so long to catch them?" --- But we all know the answer to that one.

Re:the long tradition of bigging up criminals (1)

Bazouel (105242) | more than 3 years ago | (#34217776)

Is the article making the police forces look good ? Hardly. They caught the hackers by luck (thanks to the Russian CC reseller) and it is repeated many times that Gonzalez considered them ignorant and outwitted. The lyric description of the hackers lifestyle rather glorifies them and make them look like superstars, which we all know on slashdot is far from the reality.

idiot press (2, Insightful)

Anonymous Coward | more than 3 years ago | (#34215580)

If he was so poorly educated and not a particularly well-skilled hacker, and it still took the FBI so long to figure out it was him and bring a conviction, what are they doing against hackers who are actually good? How are they fairing against highly intelligent, well-organized, and well-funded teams of hackers being employed by other nations to the infiltrate US government, commercial, and industrial systems. We know those bad guys exist. Where are all the arrests and front-page stories?

Uneducated and under-resourced petty criminals like Gonzalez are the EASY fish. What is the FBI doing against the real bad guys? Unfortunately, our press is so lazy and dumb they cannot see the writing on the wall. The story of the decade and the one that will ultimately change the US forever. nope.....they're going to chase the Gonzalez story, because that's what the FBI gave them. Online fraud. A few hundred million? 1 Billion?

All while 100s of billions of dollars in research and development across every sector of our economy walks out the door. While every facet of our government is attacked daily. Great catch guys.

FBI has shutoff all non-terror resources basically (1)

HongPong (226840) | more than 3 years ago | (#34220708)

The thing is that the FBI has basically diverted all their white collar crime resources, and probably whatever might be used to track hacking / financial crime stuff, into stupid counter-terror campaigns. This whole mess is really a permutation of white-collar crime.

They haven't sent a single greater-than-pawn level obvious fraudulent white collar criminal to prison in like a decade. They catch a couple hackers running large creditcard schemes but they haven't done jack about the industrial espionage, which as you note is going 'all the while.'

I am mainly just sad that all this context is lost, the one primary thing feds are good at is 'making an example' and making sure that it appears to be a broad enough example that they are getting to the core of the matter.

What an idiot (-1, Troll)

Anonymous Coward | more than 3 years ago | (#34215646)

That Albert Gonzalez is a useless piece of shit. Stupid chicano, hope he is having he ass pwn3d every day in the showers.

Full article text (-1, Redundant)

Nero Nimbus (1104415) | more than 3 years ago | (#34215676)

November 10, 2010
The Great Cyberheist
One night in July 2003, a little before midnight, a plainclothes N.Y.P.D. detective, investigating a series of car thefts in upper Manhattan, followed a suspicious-looking young man with long, stringy hair and a nose ring into the A.T.M. lobby of a bank. Pretending to use one of the machines, the detective watched as the man pulled a debit card from his pocket and withdrew hundreds of dollars in cash. Then he pulled out another card and did the same thing. Then another, and another. The guy wasn't stealing cars, but the detective figured he was stealing something.

Indeed, the young man was in the act of "cashing out," as he would later admit. He had programmed a stack of blank debit cards with stolen card numbers and was withdrawing as much cash as he could from each account. He was doing this just before 12 a.m., because that's when daily withdrawal limits end, and a "casher" can double his take with another withdrawal a few minutes later. To throw off anyone who might later look at surveillance footage, the young man was wearing a woman's wig and a costume-jewelry nose ring. The detective asked his name, and though the man went by many aliases on the Internet -- sometimes he was cumbajohny, sometimes segvec, but his favorite was soupnazi -- he politely told the truth. "Albert Gonzalez," he said.

After Gonzalez was arrested, word quickly made its way to the New Jersey U.S. attorney's office in Newark, which, along with agents from the Secret Service's Electronic Crimes Task Force, had been investigating credit- and debit-card fraud involving cashers in the area, without much luck. Gonzalez was debriefed and soon found to be a rare catch. Not only did he have data on millions of card accounts stored on the computer back in his New Jersey apartment, but he also had a knack for patiently explaining his expertise in online card fraud. As one former Secret Service agent told me, Gonzalez was extremely intelligent. "He knew computers. He knew fraud. He was good."

Gonzalez, law-enforcement officials would discover, was more than just a casher. He was a moderator and rising star on, an archetypal criminal cyberbazaar that sprang up during the Internet-commerce boom in the early 2000s. Its users trafficked in databases of stolen card accounts and devices like magnetic strip-encoders and card-embossers; they posted tips on vulnerable banks and stores and effective e-mail scams. Created by a part-time student in Arizona and a former mortgage broker in New Jersey, Shadowcrew had hundreds of members across the United States, Europe and Asia. It was, as one federal prosecutor put it to me, "an eBay, and MySpace for cybercrime."

After a couple of interviews, Gonzalez agreed to help the government so he could avoid prosecution. "I was 22 years old and scared," he'd tell me later. "When you have a Secret Service agent in your apartment telling you you'll go away for 20 years, you'll do anything."

He was also good-natured and helpful. "He was very respectable, very nice, very calm, very well spoken," says the Secret Service agent who would come to know Gonzalez best, Agent Michael (a nickname derived from his real name). "In the beginning, he was quiet and reserved, but then he started opening up. He started to trust us."

The agents won his trust in part by paying for his living expenses while they brought him to their side and by waiting for Gonzalez to work through his withdrawal. An intermittent drug addict, Gonzalez had been taking cocaine and modafinil, an antinarcoleptic, to keep awake during his long hours at the computer. To decompress, he liked Ecstasy and ketamine. At first, a different agent told me, "he was extremely thin; he smoked a lot, his clothes were disheveled. Over time, he gained weight, started cutting his hair shorter and shaving every day. It was having a good effect on his health." The agent went on to say: "He could be very disarming, if you let your guard down. I was well aware that I was dealing with a master of social engineering and deception. But I never got the impression he was trying to deceive us."

Gonzalez's gift for deception, however, is precisely what made him one of the most valuable cybercrime informants the government has ever had. After his help enabled officials to indict more than a dozen members of Shadowcrew, Gonzalez's minders at the Secret Service urged him to move back to his hometown, Miami, for his own safety. (It was not hard for Shadowcrew users to figure out that the one significant figure among their ranks who hadn't been arrested was probably the unnamed informant in court documents.) After aiding another investigation, he became a paid informant in the Secret Service field office in Miami in early 2006. Agent Michael was transferred to Miami, and he worked with Gonzalez on a series of investigations on which Gonzalez did such a good job that the agency asked him to speak at seminars and conferences. "I shook the hand of the head of the Secret Service," Gonzalez told me. "I gave a presentation to him." As far as the agency knew, that's all he was doing. "It seemed he was trying to do the right thing," Agent Michael said.

He wasn't. Over the course of several years, during much of which he worked for the government, Gonzalez and his crew of hackers and other affiliates gained access to roughly 180 million payment-card accounts from the customer databases of some of the most well known corporations in America: OfficeMax, BJ's Wholesale Club, Dave & Buster's restaurants, the T. J. Maxx and Marshalls clothing chains. They hacked into Target, Barnes & Noble, JCPenney, Sports Authority, Boston Market and 7-Eleven's bank-machine network. In the words of the chief prosecutor in Gonzalez's case, "The sheer extent of the human victimization caused by Gonzalez and his organization is unparalleled."

At his sentencing hearing in March, where he received two concurrent 20-year terms, the longest sentence ever handed down to an American for computer crimes, the judge said, "What I found most devastating was the fact that you two-timed the government agency that you were cooperating with, and you were essentially like a double agent."

IN APRIL, I visited Gonzalez at the Wyatt Detention Center in Central Falls, R.I., situated by a river and a pleasant place as jails go. Once muscular and tan, Gonzalez, who turned 27 and 28 behind bars, was pallid and thin. His khaki uniform hung on him baggily, and his eyes were bloodshot behind wire-rim glasses. Occasionally a mischievous smile played on his face; otherwise, he looked through the wire-glass partition with a sympathetic but inscrutably intense stare.

He didn't want to talk about his crimes at first, so in a soft voice he told me about his ex-girlfriend, who had stopped visiting him ("I can't blame her"), about what he'd been reading ("Stalingrad," by Antony Beevor; "Into Thin Air," by Jon Krakauer; essays by Ralph Waldo Emerson), about his thoughts on recent high-profile computer breaches in the news. The public's ignorance about his chosen criminal field baffled him. He had become a fan of National Public Radio at Wyatt, and had recently listened to a discussion of hackers on "Fresh Air." ("Terry Gross is a great host," he wrote me earlier in a letter, but "these authors and co-authors can't possibly be making decent earnings. Are they?") He talked about his childhood and family. His father, Alberto Sr., is a landscaper who as a young man left Cuba on a raft and was picked up by a Coast Guard cutter in the Florida straits. He and Albert share a birthday with Gonzalez's 5-year-old nephew, "whom I love more than anyone in this world," Gonzalez said. His nephew's mother, Maria, Gonzalez's sister and only sibling, "always learned by listening to our parents' advice." He didn't.

Gonzalez bought his first PC, with his own money, when he was 12. He took an interest in computer security after it was infected with a downloaded virus. "We had to call the technician who sold it to us, and he came over," he said in one letter. "I had all these questions for him: 'How do I defend myself from this? Why would someone do this?' " He got over his indignation easily enough, and by the time he was 14 had hacked into NASA, which resulted in a visit by F.B.I. agents to his South Miami high school. Undeterred, Gonzalez formed a cooperative of "black hats" -- curiosity-driven hackers with an antiauthoritarian bent -- and acquired a reputation. He gave an interview to the online magazine ZDNet under his new screen name, soupnazi: "Defacing a site to me is showing the admins [and] government . . . that go to the site that we own them," he said. On the side he was also purchasing clothing and CDs online with stolen credit-card numbers. He ordered the merchandise delivered to empty houses in Miami, and then had a friend drive him to pick it up during lunch period.

By the time he dropped out of Miami Dade College during his freshman year, Gonzalez had taught himself, by reading software manuals, how to hack into Internet service providers for free broadband. He discovered he could go further than that and co-opted the log-ins and passwords of managers and executives. "On their computers would always be a huge stash of good information, network diagrams, write ups," he said, audibly enthralled at the memory. "I would learn about the system architecture. It was as if I was an employee."

Gonzalez's closest friend, Stephen Watt, who is now serving a two-year prison sentence for coding a software program that helped Gonzalez steal card data, describes Gonzalez as having "a Sherlock Holmes quality to him that is bounded only by his formal education." Like the other hackers who would go on to form the inner circle of Gonzalez's criminal organization, Watt met Gonzalez when both were teenagers, on EFnet, an Internet relay chat network frequented by black hats. Watt and Gonzalez interacted strictly online for a year, though each lived in South Florida. Once they began spending time together, in Florida and New York, Watt, who is 27, noticed that Gonzalez's talents as an online criminal carried over into his life away from the computer. "He could spot wedding rings at 50 yards. He could spot a Patek Philippe at 50 yards. He would have been a world-class interrogator. He was very good at figuring out when people were lying."

Like many hackers, Gonzalez moved easily between the licit and illicit sides of computer security. Before his first arrest, in the A.T.M. lobby, Gonzalez made his way from Miami to the Northeast after he hacked into a New Jersey-based Internet company and then persuaded it to hire him to its security team. The transition from fraudster to informant was not too different.

After he agreed in 2003 to become an informant, Gonzalez helped the Justice Department and the Secret Service build, over the course of a year, an ingenious trap for Shadowcrew. Called Operation Firewall, it was run out of a makeshift office in an Army repair garage in Jersey City. Gonzalez was its linchpin. Through him, the government came to, in hacker lingo, own Shadowcrew, as undercover buyers infiltrated the network and traced its users around the world; eventually, officials even managed to transfer the site onto a server controlled by the Secret Service. Meanwhile, Gonzalez patiently worked his way up the Shadowcrew ranks. He persuaded its users to communicate through a virtual private network, or VPN, a secure channel that sends encrypted messages between computers, that he introduced onto the site. This VPN, designed by the Secret Service, came with a special feature: a court-ordered wiretap.

Gonzalez worked alongside the agents, sometimes all day and into the night, for months on end. Most called him Albert. A couple of them who especially liked him called him Soup, after his old screen-name soupnazi. "Spending this much time with an informant this deeply into a cybercrime conspiracy -- it was a totally new experience for all of us," one Justice Department prosecutor says. "It was kind of a bonding experience. He and the agents developed over time a very close bond. They worked well together."

On Oct. 26, 2004, Gonzalez was taken to Washington and installed in the Operation Firewall command center at Secret Service headquarters. He corralled the Shadowcrew targets into a chat session. At 9 p.m., agents began knocking down doors. By midnight, 28 people across eight states and six countries had been arrested, most of them mere feet from their computers. Nineteen were eventually indicted. It was by some estimates the most successful cybercrime case the government had ever carried out.

"I did find the investigation exciting," Gonzalez told me of turning against Shadowcrew. "The intellectual element. Unmasking them, figuring out their identities. Looking back, it was kind of easy, though. When someone trusts you, they let their guard down."

He did say, however, that he "actually had a bad conscience" about it. "I had a moral dilemma, unlike most informants." On another occasion, when he was discussing the same subject, Gonzalez wrote to me in a letter, "This distinction is very important . . . my loyalty has always been to the black-hat community."

Those captured by the government with his help are less interested in this distinction. "Shadowcrew was not a forum of thugs," a member who occasionally laundered money for Gonzalez told me. This casher served two years in prison thanks to Operation Firewall. "He was a coward who betrayed us all, and I suppose if you believe in karma, he got what he deserved in the end."

Before being arrested, Gonzalez had actually vouched for this casher to the higher-ups at Shadowcrew. He had gone out of his way to help many members, according to the federal prosecutor in New Jersey, Scott Christie, who worked with him on Operation Firewall. Christie says that based on their exchanges when Gonzalez was being recruited as an informant, Gonzalez seemed to be "less interested in money than in building up Shadowcrew." He "gave back to the members in the way of education and personal benefit. Unlike other cybercriminals, he wasn't just out for gain."

Indeed, no one I spoke with compared him to a gangster or a mercenary -- preferred honorifics among hackers -- but several likened him to a brilliant executive. "In the U.S., we have two kinds of powerful, successful business leaders. We have people like Bill Gates and Steve Jobs, who are the most sophisticated of electronic technicians and programmers," says Steve Heymann, the Massachusetts assistant U.S. attorney who, in the spring of 2010, secured a combined 38 years of prison time for Gonzalez and his co-conspirators for their corporate breaches. "Then we have others, like the C.E.O.'s of AT&T or General Electric, who are extremely good in their area but also know when to go to others for expertise and how to build powerful organizations by using those others. Gonzalez fits into that second category."

BY THE TIME Gonzalez returned to Miami after Operation Firewall, in late 2004, he was already exploring the vulnerability of corporate wireless networks. Just as data security had been an afterthought for many businesses in their rush to get online in the 1990s, creating opportunities for the likes of Shadowcrew, many firms had taken no precautions as they eagerly adopted WiFi in the early 2000s. Gonzalez was especially intrigued by the possibilities of a technique known as "war driving": hackers would sit in cars or vans in the parking lots of big-box stores with laptops and high-power radio antennae and burrow through companies' vulnerable WiFi networks. Adepts could get into a billion-dollar multinational's servers in minutes.

Gonzalez reconnected with an old friend from EFnet, Christopher Scott, who was willing to do grunt work. Scott began cruising the commercial stretches of Route 1 in Miami, looking for war-driving targets. His experiments at BJ's Wholesale Club and DSW met with success. He stole about 400,000 card accounts from the former, a million from the latter. He described the breaches and passed card numbers to Gonzalez.

The following summer, Scott parked outside a pair of Marshalls stores. He enlisted the help of Jonathan James, a minor celebrity among Miami black hats for being the first American juvenile ever incarcerated for computer crimes. (At 15, he hacked into the Department of Defense; he lived under house arrest for six months.) Scott cracked the Marshalls WiFi network, and he and James started navigating the system: they co-opted log-ins and passwords and got Gonzalez into the network; they made their way into the corporate servers at the Framingham, Mass., headquarters of Marshalls' parent company, TJX; they located the servers that housed old card transactions from stores. Scott set up a VPN -- the system Gonzalez and the Secret Service used to ensnare Shadowcrew -- so they could move in and out of TJX and install software without detection. When Gonzalez found that so many of the card numbers they were getting were expired, he had Stephen Watt develop a "sniffer" program to seek out, capture and store recent transactions. Once the collection of data reached a certain size, the program was designed to automatically close, then encrypt, compress and forward the card data to Gonzalez's computer, just as you might send someone an e-mail with a zip file attached. Steadily, patiently, they siphoned the material from the TJX servers. "The experienced ones take their time and slowly bleed the data out," a Secret Service analyst says.

By the end of 2006, Gonzalez, Scott and James had information linked to more than 40 million cards. It wasn't a novel caper, but they executed it better than anyone else had. Using similar methods, they hacked into OfficeMax, Barnes & Noble, Target, Sports Authority and Boston Market, and probably many other companies that never detected a breach or notified the authorities. Scott bought a six-foot-tall radio antenna, and he and James rented hotel rooms near stores for the tougher jobs. In many cases, the data were simply there for the taking, unencrypted, unprotected.

"For a long time, probably too long a time, computer security was something that was just dollars and cents off the bottom line -- it doesn't bring in money," Heymann told me when I asked why war-driving hackers were able to steal data so easily. "At the same time, in these cases, companies were beginning to warehouse vast amounts of information" far more swiftly than they were coming to understand the vulnerabilities of their systems. A result was what he called "a primeval muck that creates a period when dramatic, costly attacks can get at vast amounts of resources."

At the same time that Gonzalez was stealing all this bank-card data, he was assembling an international syndicate. His favored fence was a Ukrainian, Maksym Yastremskiy, who would sell sets of card numbers to buyers across the Americas, Europe and Asia and split the proceeds with him. Gonzalez hired another EFnet friend, Jonathan Williams, to cash out at A.T.M.'s across the country, and a friend of Watt's in New York would pick up the shipments of cash in bulk sent by Williams and Yastremskiy. Watt's friend would then wire the money to Miami or send it to a post-office box there set up by James through a proxy. Gonzalez established dummy companies in Europe, and to collect payment and launder money he opened e-gold and WebMoney accounts, which were not strictly regulated (e-gold has since gone out of business). He also rented servers in Latvia, Ukraine, the Netherlands and elsewhere to store the card data and the software he was using for the breaches. Finally, he joined up with two Eastern European hackers who were onto something visionary. Known to him only by their screen names, Annex and Grig, they were colluding to break into American card-payment processors -- the very cash arteries of the retail economy.

"I've been asking myself, why did I do it?" Gonzalez told me over the phone from prison recently. "At first I did it for monetary reasons. The service's salary wasn't enough, and I needed the money. By then I'd already created the snowball and had to keep doing it. I wanted to quit but couldn't." He claims his intentions were partly admirable. He genuinely wanted to help out Patrick Toey, a close friend and hacker who would later do much of the more sophisticated legwork involved in Gonzalez's hacking into corporate networks. Unlike Gonzalez and Watt, Toey, who is 25, had a rough upbringing. After dropping out of high school, he supported his mother and his younger brother and sister by hacking. Gonzalez invited Toey to live in his condominium in Miami, rent-free. Gonzalez owned it, but he enjoyed living at home with his parents more. He says he loved his mother's cooking and playing with his nephew, and he could more easily launder money through his parents' home-equity line of credit that way.

Gonzalez relished the intellectual challenges of cybercrime too. He is not a gifted programmer -- according to Watt and Toey, in fact, he can barely write simple code -- but by all accounts he can understand systems and fillet them with singular grace. I often got the impression that this was computer crime's main appeal for Gonzalez.

But he also liked stealing. "Whatever morality I should have been feeling was trumped by the thrill," he told me. And he liked spending. Partly but not entirely in jest, he took to referring to his scheme as Operation Get Rich or Die Tryin', after the 50 Cent album and movie. Gonzalez would not discuss with me just how rich he got, but he certainly was seeing profits in the millions of dollars. Little of that found its way to Toey, however, and probably none to Watt. For himself, Gonzalez bought, in addition to the condo, a new BMW 330i. He often stayed in luxury hotel suites in Miami on a whim. He took frequent trips to New York, where he and Watt -- who worked by day in the I.T. department of Morgan Stanley and later developed securities-trading software and moonlighted as a nightclub promoter -- spent thousands on hotels, restaurants, clubs and drugs. Lots of drugs. "I don't know when he slept," Agent Michael says, referring to Gonzalez's lifestyle during the time they worked together.

It seems clear now that Gonzalez didn't mind betraying people. What would come to anger the Secret Service most is that he used information from their investigations to enrich himself. "He would be working for the service during the day, and then come home and talk to me, and I'd be selling dumps for him," Toey told me, referring to databases of stolen card information. Gonzalez sold dumps to hackers who he knew were under investigation, in effect setting them up. In the case of one Miami suspect being investigated by the service, Toey told me: "We basically ripped [him] off and sold him databases that were all dead and expired. They came from a company where a breach was being investigated by the service. He got caught with the database, and it looked like he'd done it." Toey and Gonzalez then split the profits. (Gonzalez confirmed this account of events.)

When I asked Toey how he felt about using information from government investigations to betray other hackers, including black hats, he said: "I didn't like it at all that he did it. But at the same time, I don't know any of those people." He added, "More money for us."

Agent Michael investigated the Miami suspect, but he did not know until I told him that Gonzalez had set the man up. "It doesn't surprise me," he said. "Looking back, we knew what he wanted us to know. . . . He was leading a double life within a double life."

BY THE SPRING of 2007, Gonzalez was tired of working for the Secret Service. "He wasn't showing up on time," according to Agent Michael, who began talking with other agents about cutting Gonzalez loose. "He didn't want to be there." He was also tired of war driving. He wanted a new challenge. He found one in a promising technique called SQL injection.

SQL (usually pronounced "sequel") stands for Structured Query Language, the programming language that enables most commercial Web sites to interact with their associated databases. When you log on to the Web site of a clothing store to buy a sweater, for example, the site sends your commands in SQL back to the databases where the images and descriptions of clothing are stored. The requested information is returned in SQL, and then translated into words, so you can find the sweater you want. But there is a vulnerability here: such databases in a company's servers often exist in proximity to other all-too-accessible databases with more sensitive information -- like your credit-card number.

SQL is the lingua franca of online commerce. A hacker who learns to manipulate it can penetrate a company with frightening dependability. And he doesn't need to be anywhere near a store or a company's headquarters to do so. Since SQL injections go through a Web site, they can be done from anywhere.

Gonzalez urged Watt and Toey to experiment with SQL. Watt wasn't interested. "I had objections to what he was doing on a moral level -- and on top of that, I took an intellectual exception," Watt says. "If Albert said we were going to go after the Church of Scientology or Blackwater, I would have dove in headfirst." Toey, however, said he felt he owed Gonzalez. He began poking around on the sites of businesses that seemed vulnerable -- or for which he had a philosophical distaste. "I just didn't like what they did," he said of the clothing chain Forever 21. The clothes were poorly made, he said, and the employees poorly paid. "It's just everything I hate about this country in one store."

Under the assault of Toey's expertise and contempt, Forever 21 didn't stand a chance. "I went to their Web site, and I looked at their shopping-cart software, and within five minutes, I found a problem," he said, with his customary concision. "Within 10 minutes we were on their computers and were able to execute commands freely. From there we leveraged access until we were the domain administrators. Then I passed it over to Albert."

What came next was the truly inspired step. Gonzalez focused on TJX in part because it stored old transactions, but he found that many of the cards were expired. He needed a way to get to cards right after customers used them. It was possible, he learned, to breach the point-of-sale terminals at stores, the machines on checkout counters through which you swipe your card at the supermarket, the gas station, the department store -- just about anywhere you buy something.

Gonzalez and Toey took reconnaissance trips to stores around Miami to look at the brands and makes of their terminals. He downloaded schematics and software manuals. Earlier, Jonathan Williams visited an OfficeMax near Los Angeles, loosened a terminal at a checkout counter and walked out of the store with it. Hackers working with an Estonian contact of Gonzalez's hacked into the Maryland-based Micros Systems, the largest maker of point-of-sale systems, and stole software and a list of employee log-ins and passwords, which they sent to Gonzalez.

Now once Toey got him into a system, Gonzalez no longer had to sift through databases for the valuable stuff. Instead, he could go straight to the servers that processed the cards coming from the terminals, in the milliseconds before that information was sent to banks for approval. He tried this on JCPenney, the clothing chain Wet Seal and the Hannaford Brothers grocery chain, in the last instance compromising more than four million cards. His Estonian contact used the technique on Dave & Buster's. "Every time a card was swiped, it would be logged into our file," Toey says. "There was nothing anyone could do about it."

When they pieced together how Gonzalez organized these heists later, federal prosecutors had to admire his ingenuity. "It's like driving to the building next to the bank to tunnel into the bank," Seth Kosto, an assistant U.S. attorney in New Jersey who worked on the case, told me. When I asked how Gonzalez rated among criminal hackers, he replied: "As a leader? Unparalleled. Unparalleled in his ability to coordinate contacts and continents and expertise. Unparalleled in that he didn't just get a hack done -- he got a hack done, he got the exfiltration of the data done, he got the laundering of the funds done. He was a five-tool player."

Gonzalez and Toey were returning from a trip to Toys "R" Us to check out its terminals one afternoon in the spring of 2008 when a sports car with tinted windows pulled up behind them at a red light. Gonzalez became suspicious and turned into a bus lane. The sports car followed. When the light turned green, Gonzalez didn't move. The car didn't move. After waiting for minutes, in a static game of chicken, car horns blaring, Gonzalez suddenly accelerated into oncoming traffic before doing a U-turn and turning into an alley. The pursuing car flew by, Gonzalez pulled out behind him, sped up alongside the car and peered inside. Gonzalez and Toey made out a police light on the dashboard. It was a surveillance car.

Gonzalez had by that point stopped working as an informant, according to the service. Instructions had come down to the Miami field office to start tailing him. Maybe the most valuable cybercrime informant it had ever employed, the key to Operation Firewall, was now being investigated. And the Secret Service wasn't alone: the F.B.I. was looking into a wireless intrusion at Target's headquarters that originated at one of its Miami stores. The store, the bureau discovered, was in the line of sight of Gonzalez's condo, in ideal range for a war-driving antenna.

But Gonzalez wasn't worried. He was certain he'd covered all his tracks.

KIM PERETTI KNOWS Gonzalez as well as almost anyone in the government. She has worked with him. She has also prosecuted him -- though Peretti does not come across as a federal prosecutor. Younger in appearance than her 40 years, she grew up in Wisconsin and is girlish, even bubbly, in person, apt to express frustration with phrases like "Oh, sugar!" Peretti was hired to the Justice Department's Computer Crime and Intellectual Property Section shortly after 9/11. Peretti made a point of getting to know the agents in the Secret Service's Electronic Crimes Task Force because she knew that they were, like her, eager to make a name in going after cybercriminals. She lobbied to be assigned to Operation Firewall, and in 2003 she was.

When I met Peretti at a restaurant near her new office in McLean, Va. -- she left the government in May to take a job at PriceWaterhouseCoopers -- she was wearing a blue skirt suit and designer glasses. "She's got the whole Sarah Palin eyewear thing going on," Gonzalez had written to me in a letter, by way of explaining that it wasn't at all unpleasant being investigated by her. But their relationship goes back further than that. Much of what Peretti knows about cybercrime she learned from working with Gonzalez.

"Albert was an educator," she said, describing their experience on Operation Firewall. "We in law enforcement had never encountered anything like" him. "We had to learn the language, we had to learn the characters, their goals, their techniques. Albert taught us all of that." They worked as well together as any investigative team she has been a part of, she said.

When we met, Peretti brought with her a poster-size screen shot of Shadowcrew's homepage as it appeared the day after the raids. Secret Service technicians had defaced it with a photograph of a shirtless, tattooed tough slouching in a jail cell. The text said, "Contact your local United States Secret Service field office . . . before we contact you!"

By the time she was 35, thanks to Operation Firewall and Gonzalez, Peretti was the Justice Department's chief prosecutor of cybercrime in Washington. But in 2005, even as she was litigating the Shadowcrew case, she encountered a new cybercrime wave unlike anything that had come before. "The service keeps calling me, saying, 'We've got another company that contacted us,' " she said. "The volume was getting bigger and bigger. There was just an explosion."

In the days before Christmas 2006, the Justice Department and Stephen Heymann, the assistant U.S. attorney in Massachusetts, received a series of frantic calls from TJX's attorneys. The company had been contacted by a credit-card company, because a rapidly growing number of cards used at Marshalls and T. J. Maxx stores seemed to have been stolen. TJX had examined its Framingham, Mass., servers, and what it found was catastrophic. According to its own account, for about a year and a half, cards for "somewhere between approximately half to substantially all of the transactions at U.S., Puerto Rican and Canadian stores" were believed stolen. It was the biggest theft of card data in U.S. history, and there wasn't a lead in sight.

"At that point we had quite literally the entire world as possible suspects," Heymann told me in May, when we met in his office in the federal court building overlooking Boston Harbor. With his father, Philip, a deputy attorney general in the Clinton administration, Heymann teaches courses on criminal law at Harvard Law School. He had been deputy chief of the Massachusetts U.S. attorney's criminal division and then set up one of the first computer-crime units in the country, so he was well versed in the comparative challenges. "If you've got a murder scene, there's blood, there's fingerprints. If you have a hacker going into a company, the critical information can be lost the moment the connection is broken. The size of the networks might be so large and so confusing that they're very hard to understand and search. The people involved may only be known by screen names. Figuring that out is very different from figuring out who Tony the Squirrel is," he said. Heymann had never seen anything like the TJX breach.

Then, in 2007, attorneys for Dave & Buster's called the Secret Service. That company, too, had been breached, but this was different. The thieves had managed to access its point-of-sale system. By that summer, Peretti and Heymann had huge amounts of data, lots of potential leads and no clue as to whom they were chasing. "For the first six to nine months, it was tiring, exhaustive, thorough," Heymann told me. "I'd like to tell you it was also brilliant and incisive and led to the key lead, but it wasn't." They were in desperate need of a break.

They finally got one, courtesy of Peretti's old friends at the Secret Service. For two years, it turned out, an undercover agent in its San Diego office had been buying card dumps from Maksym Yastremskiy, Gonzalez's fence. The agent traveled to Thailand and Dubai to meet with the Ukrainian, and in Dubai he furtively copied the hard drive in Yastremskiy's laptop. Technicians at the Secret Service combed through it and discovered, to their joy, that Yastremskiy was a meticulous record keeper. He had saved and catalogued all of his customer lists and instant messages for years. In the logs, they found a chat partner who appeared to be Yastremskiy's biggest provider of stolen card data. But all they had for the person was an I.M. registration number -- no personal information.

In July 2007, Yastremskiy was arrested in a nightclub in Turkey, and the Secret Service turned up a useful lead. The anonymous provider had asked Yastremskiy to arrange a fake passport. One of the provider's cashers had been arrested, and he wanted to get his man out of the United States. The only problem: he didn't say where the casher had been arrested.

So agents phoned every police station and district attorney's office around the country that had made a similar arrest or brought a similar case. After weeks of these calls, their search led them to a prison cell in North Carolina, where Jonathan Williams was being held. He had been arrested with $200,000 in cash -- much of which had been intended for Gonzalez -- and 80 blank debit cards; the local authorities hadn't linked him to a larger criminal group, and they couldn't have known about Gonzalez. The Secret Service agents plugged in a thumb drive in Williams's possession at the time of his arrest and found a file that contained a photograph of Gonzalez, a credit report on him and the address of Gonzalez's sister, Maria, in Miami. (He was also arrested with a Glock 9-millimeter pistol and two barrels for the gun, one threaded to fit a silencer.) The file was "a safety precaution, in case [Gonzalez] tried to inform on me," Williams told me from prison in June. Officials then traced packages Williams had sent to the post-office box in Miami. This led the Secret Service to Jonathan James. They pulled James's police records and found that in 2005 he was arrested by a Palmetto Bay, Fla., police officer who found him in the parking lot of a retail store in the middle of the night. The officer didn't know why James and his companion, a man named Christopher Scott, were sitting in a car with laptops and a giant radio antenna, but she suspected they weren't playing World of Warcraft.

The real eureka moment came when Secret Service technicians finally got the I.M. registration information for whoever was providing Yastremskiy with bank-card data. There was no address or name, but there was an e-mail address: It was a dead giveaway to anyone who knew Gonzalez. Peretti remembers vividly the afternoon in December 2007 when agents called her and told her to come to their office. They sat her down and showed her the e-mail address. "And they looked at me," Peretti said. "They've got 10 agents looking at me. Three minutes passed by, I was sitting there like a dull person. And then I was like, 'Oh, my God!' "

Gonzalez knew the Secret Service was investigating Yastremskiy, but he continued to move databases through him. When I asked Gonzalez why, he said, "I never thought he would leave Ukraine." The country has no extradition policy with the U.S. But Yastremskiy did leave. "It wasn't until he got busted," Gonzalez told me, that he realized his mistake.

Operation Get Rich or Die Tryin' unraveled fast. Christopher Scott's home and Gonzalez's condo were raided simultaneously. Agents seized Scott, along with nine computers and 78 marijuana plants; in Gonzalez's place they found various designer drugs and a half-asleep Patrick Toey. Toey was flown to Boston to testify before a grand jury. He directed Heymann and Peretti to the e-gold and WebMoney accounts and to servers located abroad. The servers eventually led them to Watt, who returned to his Greenwich Village apartment to find agents and a battering ram awaiting him. The Gonzalezes' home was raided, but Albert was not there.

Peretti knew that if they didn't find him soon, he would disappear. "Albert had said during Firewall how afraid he was of spending any time in prison," she said. "I knew he'd be gone the next day."

They found him at 7 in the morning on May 7, 2008, when agents rushed into his suite at the National Hotel in Miami Beach. With him were a Croatian woman, two laptops and $22,000. Over time, he started talking. Months later, he led Secret Service agents to a barrel containing $1.2 million buried in his parents' backyard. Attorney General Michael Mukasey himself held a news conference in August 2008 to announce the indictment. "So far as we know, this is the single largest and most complex identity-theft case ever charged in this country," he told reporters. Gonzalez's attorney assured him the government's case was weak. Electronic evidence often didn't hold up, he said.

That was before attorneys for Heartland Payment Systems Inc., in Princeton, N.J., called Peretti in early January 2009. One of the largest card-payment processors in the country, Heartland, which services about a quarter of a million businesses, had been hacked. But not just hacked -- owned in a way no company had ever been owned. As Peretti would soon learn from Gonzalez, he had helped the two Eastern European hackers, Annex and Grig, slip into Heartland via SQL injection. By the time Heartland realized something was wrong, the heist was too immense to be believed: data from 130 million transactions had been exposed. Indictments were brought against Gonzalez in New Jersey, New York and Massachusetts (where the cases were eventually consolidated). At a loss for anything else to say, Gonzalez's attorney told a reporter: "He's really not a bad guy. He just got way in over his head."

On May 18, 2008, Jonathan James shot himself in the head. He left a suicide note saying he was convinced the government would try to pin Gonzalez's crimes on him because of the notoriety James had gained as a teenage hacker.

AT HIS SENTENCING in March, Gonzalez, who pleaded guilty to all charges, sat almost motionless. As far as I saw, he didn't once look back at the gallery in the federal courtroom in Boston, where his mother sat stoically while his father wept into a handkerchief as Gonzalez's sister consoled him. Nor did he glance at Heymann, as he told the court that Gonzalez had committed the worst computer crimes ever prosecuted; nor at Peretti, nor his old colleagues from the Secret Service, who also sat in the gallery. Gonzalez just leaned forward and peered straight ahead at the judge, as though -- the set of his head was unmistakable -- staring intensely at a computer.

He spoke just once, a few sentences at the end. "I blame nobody but myself," he said. "I'm guilty of not only exploiting computer networks but exploiting personal relationships, particularly one that I had with a certain government agency who believed in me. This agency not only believed in me but gave me a second start in life, and I completely threw that away." Accounting for time served and good behavior, Gonzalez is expected to get out of prison in 2025.

In May, Toey began a five-year sentence, and Scott started a seven-year sentence. Yastremskiy was given 30 years in a Turkish prison, a fate apparently so grim he's lobbying to be extradited to the U.S. so he can be imprisoned here. Watt, who maintains that he was never fully aware of what Gonzalez wanted to use his software for, and who refused to give information on Gonzalez to the grand jury or prosecutors, was sentenced to two years.

According to Attorney General Eric Holder, who last month presented an award to Peretti and the prosecutors and Secret Service agents who brought Gonzalez down, Gonzalez cost TJX, Heartland and the other victimized companies more than $400 million in reimbursements and forensic and legal fees. At last count, at least 500 banks were affected by the Heartland breach. But the extent of the damage is unknown. "The majority of the stuff I hacked was never brought into public light," Toey told me. One of the imprisoned hackers told me there "were major chains and big hacks that would dwarf TJX. I'm just waiting for them to indict us for the rest of them." Online fraud is still rampant in the United States, but statistics show a major drop in 2009 from previous years, when Gonzalez was active.

The company line at the Justice Department and the Secret Service is that informants go bad all the time, and that there was nothing special about Gonzalez's case. As Peretti put it, "You certainly feel anger" -- but "you're not doing your job if you fall into the trap of thinking the criminal you're working with is your best friend." The agent in charge of the Criminal Investigative Division at the Secret Service told me: "It's unfortunate. We try to take measures. But it does happen. You need to deal with criminals to get other criminals. Albert was a criminal."

Heymann lauds how the Secret Service handled things. "When you find out one of your informants has committed a crime," he said, "you can hide the fact, which unfortunately does happen from time to time. You can play it down -- soft-pedal it, try to make it go away. Or you can do what I think the Secret Service very impressively did here, which is to go full bore." He said that after Gonzalez became a suspect, "the size of the investigation, the amount of assets, all increased significantly. That reflects enormous integrity."

But Gonzalez did have friends in the government, and there is no question some of them feel deeply betrayed. Agent Michael was the most candid with me about this: "I put a lot of time and effort into trying to keep him on the straight and narrow and show him what his worth could be outside of that world, keep him part of the team. And he knows that, and he knew what good he could have done with his talent." He continued, "We work with a million informants, but for me it was really tough with him."

After his sentencing, Gonzalez was transferred from Wyatt to the Metropolitan Detention Center in Brooklyn (before ultimately ending up in a prison in Michigan). Situated between a loud stretch of the Brooklyn-Queens Expressway and Gowanus Bay, M.D.C. is brutal, even for a prison. Populated by hardened offenders, it is among the last places a nonviolent government informant would want to be. "The place is terrible," Agent Michael said. "But you know what? When you burn both ends of the candle, that's what you get." Even Gonzalez was impressed by the government's indifference to his comfort. He says he always knew it would stick it to him somehow, "but I never thought it would be this badly."

"I've been asking myself a lot why didn't I ever feel this way while I was doing it," Gonzalez told me, when I spoke with him in June. An inmate at M.D.C. who didn't like informants had recently threatened to kill him, he said. It was his 29th birthday, and the 5th birthday of his nephew. Gonzalez's sister wanted to bring her son to New York to visit, but Gonzalez told her not to. "I didn't want him to get scared, seeing me in here," he told me. Instead, Gonzalez was spending the day reading a biography of Warren Buffett.

I asked him how he felt when he thought about people like Agent Michael and Peretti. "They're part of the betrayals," he said.

During the legal proceedings, the court ordered Gonzalez to undergo a psychological evaluation. "He identified with his computer," the report reads. "It is hard, if not impossible, even at the present for Mr. Gonzalez to conceptualize human growth, development and evolution, other than in the language of building a machine."

As we spoke, Gonzalez recalled how he first became obsessed with computers as a child. "I remember so many times having arguments with my mother when she'd try to take the computer power cord from me, or she'd find me up at 6 a.m. on the computer when I had to be at school at 7:30. Or when I'd be out with [my girlfriend] and not paying any attention to her because I'd be thinking about what I could do online."

He reflected on his days with Shadowcrew, and on his decision to help the government. "I should have just done my time in 2003," he said. "I should have manned up and did it. I would be getting out about now."

James Verini is a writer in New York. This is his first article for the magazine.

Re:Full article text (1)

Nero Nimbus (1104415) | more than 3 years ago | (#34222504)

Hah, this got modded down? The NY Times article is paywalled off, and nobody else posted it, so I fail to see how the fact that I potentially saved a bunch of people from going to bugmenot to grab a username/password for is redundant.

Oh, wait. This is Slashdot. Nobody reads the articles, and very few even read the summaries. My bad. In Soviet Russia, etc, etc.

a promising technique called SQL injection ?? (1, Funny)

Anonymous Coward | more than 3 years ago | (#34215826)

"BY THE SPRING of 2007, Gonzalez .. was also tired of war driving. He wanted a new challenge. He found one in a promising technique called SQL injection ..

When you log on to the Web site of a clothing store to buy a sweater, for example, the site sends your commands in SQL back to the databases where the images and descriptions of clothing are stored. The requested information is returned in SQL, and then translated into words, so you can find the sweater you want ..

SQL is the lingua franca of online commerce. A hacker who learns to manipulate it can penetrate a company with frightening dependability. And he doesn't need to be anywhere near a store or a company's headquarters to do so. Since SQL injections go through a Web site, they can be done from anywhere
" .. link []

Fuck him, I hope he dies in prison (0)

Anonymous Coward | more than 3 years ago | (#34216216)

He is a thief, and thieves are parasites
who should be exterminated.

Of course, I'd be willing to settle for all of his fingers being cut off
and both of his eyes being removed.

Re:Fuck him, I hope he dies in prison (0, Flamebait)

FuckingNickName (1362625) | more than 3 years ago | (#34216488)

Property is theft, etc. But since you bring up a method of your most rowdy puppet state (not Israel - way too smart to be puppets)...

I can't make up my mind whether it is Americans or Saudi Arabians who are more convinced of the impossibility of a flaw in their belief systems and the resultant society created. Although I have always got better discussions from adherents to conservative Islam than from arch-capitalists, probably because only the former understand what fundamental faith-based assumptions they are making.

The Great Cyberheist (1)

ray-solomon (835248) | more than 3 years ago | (#34216524)

"The Great Cyberheist", based on a true story. I see a future movie being made soon.

People Don't Want To Understand Cybercrime (4, Insightful)

Black Gold Alchemist (1747136) | more than 3 years ago | (#34216778)

People think cybercrime is about misbegotten geniuses launch attacks using incomprehensible methods. They think cyberwar is about vast arrays of foreign hackers breaking into our high tech military systems and stealing our secrets. However, that's not what cybercrime and cyberwarfare are about. Cybercrime and cyberwarfare are about people bruteforcing some bigshot's low strength password. It's about some stupid spyware program exploiting some obvious old bug in windows and emailing your credit card to the former USSR. It's about your grandma downloading a set of "kitty" icons and infecting her computer with a botnet virus. It's about some small-time hacker calling up one secretary and getting the CEO's username, and then calling another and getting the CEO's password. These problems can't be solved by advanced security systems. They have to be solved by people. It's kind of like trying to fight cave-dwelling terrorists with a high-tech stealth bomber.

Fair is fair -- ? (0)

Anonymous Coward | more than 3 years ago | (#34218530)

I see the "$400 million" price tag and the righteous furor with which they necessarily prosecuted this guy and I have to wonder: when will someone be prosecuted for the trillions of dollars lost and the countless lives sacrificed for the Iraqi war over pretend WMDs? Why is it right to prosecute this kid and "not so much" to investigate those who pillaged our Treasury in the name of "national security"?

Off-topic, maybe - but probably just as important, if not more so. The Feds are holding this kid out as an example, but completely ignoring those who did even worse things.

From an Insider (0)

Anonymous Coward | more than 3 years ago | (#34219320)

Funny how "Eckis" ratted him out, especially considering how many people he stepped on for the USSS.
I wonder how the #phrack high council feels :)

Oh BTW back in 2002-2003 the source of all his data was from Phishing. He is the stereotypical Script Kiddie.

Did anyone else.. (1)

Lanteran (1883836) | more than 3 years ago | (#34220024)

when I read that last bit about him being expected to get out of prison in 2025, I had the mental image of Simon Phoenix hacking into the public terminal in demolition man....

Why hide? (1)

hesaigo999ca (786966) | more than 3 years ago | (#34231076)

>Another claims there 'were major chains and big hacks that would dwarf TJX. I'm just waiting for them to indict us for the rest of them
This leads me to believe the rumors that we are never really told what is going on behind the scenes of these fraud cases by the banks themselves, so how are we to know what is what, and if the banks are doing an adequate job ? Maybe some regulations for this specifics might be in order?

Why is this guy the only criminal in jail (0)

Anonymous Coward | more than 3 years ago | (#34233220)

The companies knew of the risk of this but their officers made the decision that leaving it open to facilitate other processes rather than securing their systems. They saved hundreds of thousands of dollars by not securing this hole and utilizing it for their other business processes. This decision should be criminal negligence.

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