OP 06 September, 2022 - 03:10 PM
Source: https://www.law360.com/articles/1517347/...tion-fight
Law360, London (August 2, 2022, 4:15 PM BST)
- A London court has rejected the U.S. government's attempt to keep the founder of online cybercrime marketplace **DeadForums** in prison while he awaits an extradition hearing, finding Tuesday that he was unlikely to flee to his native Portugal while out on bail.
Diogo Santos Coelho, who grew up in the U.K. before moving back to Portugal, has "substantial" ties to his family and local community and stringent bail conditions that make him a low flight risk, the High Court ruled.
Judge Stephen Morris said that 22-year-old Coelho, who is accused of running the marketplace where cybercriminals buy and sell hacked data, was not arrested until he flew into Britain in January to visit his dying mother.
"I am satisfied that [Coelho] does have community ties which are of substance in this country," said Judge Morris. "Those ties are both to his ailing mother, who appears to be on the last days of her life that he came to visit despite the U.S. authorities' interest in him … and also with his two half-sisters."
Judge Morris rejected the U.S. government's request to keep Coelho in prison, as it appealed the decision by Westminster Magistrates' Court to grant him conditional bail on Friday. Coelho is wanted on charges of conspiracy to commit access device fraud, committing access device fraud and aggravated community theft.
Counsel for the U.S. government, Reka Hollos, told the court that Coelho was "the controller and chief administrator" of **DeadForums** between 2015 and his arrest, profiting by $215,000 in the process. He is alleged to have acted as a "middleman" for buyers and sellers of illegal information including data breaches and stolen identities.
Hollos argued that Coelho could use resources such as cryptocurrency that prosecutors are not aware of if he seeks to escape to Portugal, which extradites its own citizens only under limited circumstances.
"There is the risk the extradition will be frustrated," Hollos told the court.
Anthony Vaughan, representing Coelho, emphasized that his client had waited in prison for six months for his family to come up with the £30,000 ($36,600) in security that will have to be paid to the court before he is released.
"He doesn't have a lot of money hidden away to present a flight risk," Vaughan added.
Vaughan rejected the argument by the U.S. that Coelho would escape prosecution if he fled to his native country. Even if he was not extradited he could still face legal proceedings in Portugal, where most of the alleged offending occurred, Vaughan added.
"The reality is there are strong ties between the U.S. government and the Portuguese government in anti-money laundering, anti-fraud, anti-online criminal activities areas," Vaughan said.
**DeadForums** allegedly peddled hundreds of databases with more than 10 billion hacked records, including bank routing numbers, credit card information, Social Security numbers and website login credentials.
Cybercriminals bought the data with Bitcoin and through PayPal, prosecutors said. **DeadForums** also offered a tiered membership system, including a top-tier "God" status that allowed users access to additional features and data, according to court filings.
The US government was represented by Reka Hollos of Three Raymond Buildings.
Coelho was represented by Anthony Vaughan of Doughty Street Chambers.
The case is The Government Of The United States of America v. Coelho, case number CO-2748-2022, at the High Court of England and Wales.
-Additional reporting by Rachel Sharf. Editing by Ed Harris.
Law360, London (August 2, 2022, 4:15 PM BST)
- A London court has rejected the U.S. government's attempt to keep the founder of online cybercrime marketplace **DeadForums** in prison while he awaits an extradition hearing, finding Tuesday that he was unlikely to flee to his native Portugal while out on bail.
Diogo Santos Coelho, who grew up in the U.K. before moving back to Portugal, has "substantial" ties to his family and local community and stringent bail conditions that make him a low flight risk, the High Court ruled.
Judge Stephen Morris said that 22-year-old Coelho, who is accused of running the marketplace where cybercriminals buy and sell hacked data, was not arrested until he flew into Britain in January to visit his dying mother.
"I am satisfied that [Coelho] does have community ties which are of substance in this country," said Judge Morris. "Those ties are both to his ailing mother, who appears to be on the last days of her life that he came to visit despite the U.S. authorities' interest in him … and also with his two half-sisters."
Judge Morris rejected the U.S. government's request to keep Coelho in prison, as it appealed the decision by Westminster Magistrates' Court to grant him conditional bail on Friday. Coelho is wanted on charges of conspiracy to commit access device fraud, committing access device fraud and aggravated community theft.
Counsel for the U.S. government, Reka Hollos, told the court that Coelho was "the controller and chief administrator" of **DeadForums** between 2015 and his arrest, profiting by $215,000 in the process. He is alleged to have acted as a "middleman" for buyers and sellers of illegal information including data breaches and stolen identities.
Hollos argued that Coelho could use resources such as cryptocurrency that prosecutors are not aware of if he seeks to escape to Portugal, which extradites its own citizens only under limited circumstances.
"There is the risk the extradition will be frustrated," Hollos told the court.
Anthony Vaughan, representing Coelho, emphasized that his client had waited in prison for six months for his family to come up with the £30,000 ($36,600) in security that will have to be paid to the court before he is released.
"He doesn't have a lot of money hidden away to present a flight risk," Vaughan added.
Vaughan rejected the argument by the U.S. that Coelho would escape prosecution if he fled to his native country. Even if he was not extradited he could still face legal proceedings in Portugal, where most of the alleged offending occurred, Vaughan added.
"The reality is there are strong ties between the U.S. government and the Portuguese government in anti-money laundering, anti-fraud, anti-online criminal activities areas," Vaughan said.
**DeadForums** allegedly peddled hundreds of databases with more than 10 billion hacked records, including bank routing numbers, credit card information, Social Security numbers and website login credentials.
Cybercriminals bought the data with Bitcoin and through PayPal, prosecutors said. **DeadForums** also offered a tiered membership system, including a top-tier "God" status that allowed users access to additional features and data, according to court filings.
The US government was represented by Reka Hollos of Three Raymond Buildings.
Coelho was represented by Anthony Vaughan of Doughty Street Chambers.
The case is The Government Of The United States of America v. Coelho, case number CO-2748-2022, at the High Court of England and Wales.
-Additional reporting by Rachel Sharf. Editing by Ed Harris.