In a significant move against illicit online marketplaces, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned Behrouz Parsarad, the Iranian administrator of Nemesis, a darknet marketplace linked to the sale of fentanyl and other illicit substances.
This action follows an extensive international law enforcement operation that dismantled the platform in March 2024.
Nemesis had established itself as a central hub for cybercriminals and narcotics traffickers, facilitating the exchange of nearly $30 million worth of illegal goods between 2021 and 2024.
The designation of Parsarad marks OFAC’s first action as a member of the FBI-led Joint Criminal Opioid and Darknet Enforcement (JCODE) Team.
According to OFAC, Parsarad managed Nemesis and sought to re-establish a similar marketplace following its takedown.
The sanctions target Parsarad’s financial infrastructure, including 44 Bitcoin (BTC) addresses and five Monero addresses used for transactions on Nemesis and other darknet platforms.
Source: Chainalysis
Nemesis: A Haven for Illicit Trade and Cybercrime
Nemesis, founded in 2021, operated as an encrypted marketplace providing a safe haven for criminals to conduct anonymous transactions.
The platform’s primary function was to facilitate the sale of fentanyl, synthetic opioids, and other narcotics. However, its operations extended far beyond drug trafficking.
Nemesis also served as a marketplace for fraudulent identification documents and hacking services, enabling cybercriminals to gain unauthorized access to online accounts and communications.
Parsarad, as the sole administrator, wielded full control over the marketplace and its associated cryptocurrency wallets.
OFAC reports that he profited substantially from transaction fees, accumulating millions of dollars over the platform’s operational period.
Additionally, Nemesis was designed with built-in money laundering mechanisms that helped obscure the illicit origins of its users’ funds.
This functionality made it particularly difficult for law enforcement agencies to track and disrupt its financial flows.
Despite the marketplace’s takedown in March 2024, which was coordinated by U.S., German, and Lithuanian authorities, Parsarad has allegedly attempted to re-establish a successor darknet platform.
The Financial Implications and Wider Sanctions Impact
The designation of Parsarad under Executive Order (E.O.) 14059, which targets narcotics proliferators, carries severe financial consequences.
All property and assets linked to Parsarad within the United States or under the control of U.S. persons have been frozen. Additionally, any entities owned by Parsarad 50% or more are automatically subject to the same restrictions.
These sanctions extend beyond U.S. borders, with financial institutions and businesses worldwide penalized for conducting transactions with Parsarad.
Non-U.S. individuals and entities that facilitate transactions involving his cryptocurrency addresses may also be at risk of enforcement actions.
Notably, OFAC’s action against Parsarad aligns with previous designations targeting Genesis Market in April 2023 and Hydra Market in April 2022.
These efforts form part of a broader initiative to dismantle the financial infrastructure of darknet marketplaces that facilitate illicit activities, including drug trafficking and cybercrime.
The Treasury Department has emphasized that its ultimate goal is not merely punitive but to drive behavioral change among sanctioned individuals.
However, given Parsarad’s apparent attempts to re-establish operations, the likelihood of voluntary compliance remains slim.
This latest development is similar to the ongoing legal actions against Tornado Cash, to which the Ethereum Foundation recently donated $1.25M to support the legal defense of its developer, Alexey Pertsev.
Pertsev was convicted in May 2024 for laundering $1.2 billion through Tornado Cash, a platform that authorities claim facilitated over $7 billion in illicit transactions, including funds tied to North Korea’s Lazarus Group.
While privacy advocates insist he was merely developing open-source software, the enforcement agencies didn’t see it that way and are still in the legal battle.
For now, law enforcement agencies and financial regulators will continue monitoring darknet marketplaces and their financial networks, ensuring that those who engage in illicit trade are held accountable. Also, the ruling on Pertsev might set a precedent for regulating open-source software.
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