Tis the season for online holiday shopping, but tread carefully. While Internet shopping is often more convenient than visiting traditional stores, anonymous website hosts and illegal online marketplaces also make it more dangerous.
In 2013, federal law enforcement took down the Silk Road, an online black marketplace (used primarily to purchase and sell illegal drugs) that allowed users to browse anonymously. Silk Road 2.0 launched on November 6, 2013, but one year later, it, too, was shuttered. Bitcoin exchanges were popular during the Silk Road’s heyday. In fact, authorities seized millions of dollars’ worth of Bitcoins from the black market.
What Is a Bitcoin?
Bitcoin is a digital currency. In other words, Bitcoin is an online version of money. A computer algorithm creates Bitcoins – unique pieces of digital property that can be transferred between people without using banks as middlemen. Because each Bitcoin is unique, users cannot spend the same Bitcoin twice. Each Bitcoin also has a unique identifying web address (which includes a public address and private keys), which makes the Bitcoin “a token of value” as well as “a method for transferring that value.”
When you buy a Bitcoin, that purchase is recorded in a public blockchain that is maintained by a global network of computers. Unlike paper currency, there is no central regulating authority or specific issuing country. But Bitcoins, like paper money, can be stored in a wallet–in this case, a digital wallet. However, keep in mind that your digital wallet can be hacked, which means you could lose access to your Bitcoins.
Bitcoins are not illegal in the United States, but they are often associated with illegal activity. Bitcoin exchanges are difficult to trace, which is why they were popular on the Silk Road. Although some merchants accept Bitcoins as payment, be wary of consumer fraud and deceptive business practices.
The Consumer Fraud and Deceptive Business Practices Act
Even though the Silk Road is no longer active, there are other illegal online forums in existence. Moreover, there are online retailers that try to take advantage of unsuspecting consumers by offering deals that are too good to be true and partaking in other unlawful business practices. Illinois law protects consumers, whether they shop in person or online. The Consumer Fraud and Deceptive Business Practices Act (CFDBPA) covers a wide range of retail practices and prohibits:
- Deception, fraud, false pretenses or false promises used to sell merchandise;
- A misrepresentation or concealment of a material fact* when consumers rely on that misrepresentation or concealment; and
- Any unfair business practices.
*A “material fact” concerns information that a person would rely upon in order to make a decision.
Internet Offenses
Some people also like to “fence” stolen items on sites like Craigslist or eBay. A person commits electronic fencing when he knowingly sells stolen property on the Internet. (Note that this does not apply to people who unknowingly purchase stolen property online.) Two other examples of similar Internet offenses are:
- Online sale of stolen property – A person commits this offense when he uses the Internet with the intent to sell stolen property; and
- Online theft by deception – A person commits this offense when he knowingly uses the Internet to purchase (or attempt to purchase) property using a fictitious or stolen form of payment.
Commission of any one of these offenses is a Class 4 felony if the full retail value of the stolen property or the property obtained by deception does not exceed $300. If the full retail value exceeds $300, the offender can be charged with a Class 2 felony. A Class 4 felony carries a $25,000 fine and one to three years imprisonment, while a Class 2 felony carries a $25,000 fine and three to seven years imprisonment.
Consumer fraud is a serious offense with serious consequences. If you are facing charges under the CFDBPA, contact one of our Schaumburg criminal defense attorneys today. The law office of Glasgow & Olsson can assist those in the city of Chicago and the surrounding suburban areas.