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In general, stories related to the so-called ‘dark web’ don’t end well.

That’s the case with SpaceX engineer James Roland Jones of Hermosa Beach, California, who yesterday pleaded guilty to conspiracy to commit securities fraud related to insider tips on the dark web.

According to the Department of Justice, Jones operated under the username ‘MillionaireMike’, and was attempting to both buy and sell purported insider trading tips.

Reuters reports that he faces a maximum penalty of five years in federal prison, and his guilty plea comes as part of a settlement with the Securities and Exchange Commission (SEC):

According to the agencies, from 2016 until at least 2017, Jones conspired with another unnamed person to access various dark web marketplaces, including a website claiming to be an insider trading forum, in search of material, non-public information to use for his own securities trading…

Jones also devised a scheme to sell what he falsely claimed were insider tips on the dark web, the agencies said. Several users paying in bitcoin purchased these tips and ultimately traded based on the information Jones provided, they said.

The jig was up when he bought insider information from an undercover FBI agent in April 2017, and then told the same agent that he had information not available to the public about another company.

In total, Jones was paid around $27 000 in Bitcoin.

This case will have a number of illegal traders sweating bullets, given that it’s the first in which the SEC has brought an enforcement action alleging securities violations on the dark web.

Here’s Forbes:

“This case shows that the SEC can and will pursue securities law violators wherever they operate, even on the dark web,” David Peavler, director of the SEC’s Fort Worth Regional Office, said in a statement.

“We have committed staff and technology to pierce the cloak of anonymity these wrongdoers try to throw over their crimes.”

It appears that the net is tightening.

I don’t pretend to know much about how the dark web operates, but there may be some folks frantically erasing hard drives across the US.

Elon Musk has yet to tweet about the news, but he did share this meme, related to his NFT song:

pic.twitter.com/Ngk8SJvDUW

— Elon Musk (@elonmusk) March 19, 2021

That’s one of the world’s richest humans.

[sources:reuters&forbes]