Then, suddenly, a burst of husky voices sounded in the open-air hallway. A battering ram splintered his neighbor's door. Torres scuffled toward the sound, his mouth hanging open.
Federal agents in riot gear swarmed past.
"Are there terrorists in there?" Torres asked. An agent sent him back inside. The retiree watched through a crack in the blinds as the feds hauled out a cash-counting machine and computer gear.
It was May 7, 2008, just before 5 p.m. With military precision, agents at that moment were raiding five other homes across Miami-Dade. There was a red-tile-roofed house in Coral Gables, a one-story home in Pinecrest, and an apartment just south of Killian Parkway. A hydroponic marijuana grow house in West Kendall was also targeted. Cops even burst into Room 1508 at the National Hotel, a celebrity hangout at 17th Street and Collins Avenue in Miami Beach.
The lawmen confiscated more than a dozen computers and $422,000 in cash. They found evidence on the hard drives linking the computers to massive online thefts from huge companies such as T.J. Maxx, 7-Eleven, and Dave & Buster's. More than 170 million credit card numbers worth hundreds of millions of dollars had been stolen by a criminal ring stretching from the United States to Latvia, from Ukraine to Thailand.
It was the biggest identity theft case ever prosecuted. And at its heart were four gifted hackers born and raised in South Florida: Albert Gonzalez, AKA "soupnazi," had broken into NASA's systems as a teen and later worked undercover for the Secret Service; Jonathan James, known as "c0mrade" earned national fame at age 16 as the youngest hacker incarcerated; and James's best friend at Palmetto Senior High, Christopher Scott, was in custody too, as was Stephen Watt, AKA "Unix Terrorist," a blindingly smart, seven-foot-tall prodigy from Melbourne.
During trials and investigations that are still underway, extraordinary stories emerged of lavish, drugged-out parties and chartered cross-country flights on a whim. The fallout has included millions of cheated consumers and hundreds of millions in costs to businesses. For the gang, there were two-decade-long federal sentences, massive fines, and — for one member — a bullet through the head. With all its Miami-style excess, the case reeks of the cocaine cowboy days but with a sprig of new World Wide Web flavor.
"I think Albert and his crew got started like me, with hacking just for the thrill and the intellectual pursuit and basically thinking it was all a game," says Kevin Mitnick, the most wanted hacker in America before his 1995 arrest and now a security consultant. "But at some point in his life, Albert figured out he could make a lot of money hacking for profit. He liked that. And that's when everything changed."
Jonathan James and Albert Gonzalez grew up just 15 minutes apart in quiet, residential neighborhoods south of downtown Miami. Both showed an early genius for computers, and both were interrogated by the FBI in high school. The pair even seems to have joined the same online gang, the Keebler Elves.
Yet they likely didn't meet face-to-face until Gonzalez's senior year of high school in 1999.
Jonathan's dad, Bobby, is a computer programmer from outside Pensacola with a thick goatee, a twinge of a Panhandle accent, and a dry sense of humor. He moved to Miami in 1982 with his wife, Joanne Jurysta, a brunette with a dazzling smile.
Jonathan was born in 1983, the year the family settled into a ranch-style home on SW 72nd Court in a leafy enclave of Pinecrest. Three years later, they had a second son, Josh. Bobby had a good job programming for Miami-Dade County, and the boys were raised upper-middle class and Jewish, attending arguably the region's best private grade school, the pricey Temple Beth Am.
When Jonathan was 6, he began spending whole days on his dad's PC. By middle school, he had switched the family PC from Windows to Linux so he could have more control over the code.
Jonathan's parents were thrilled at his gifts but also wary of his disobedience. Once, when the boy was 13, his mother took away a computer after catching him online in the middle of the night. "He ran away from home and called to say that he wouldn't come back until he got his computer back," Bobby remembers. "We asked the police to trace the call, and he was at this Borders bookstore that was, like, four blocks away."
Later, Bobby tried more desperate measures — slicing the phone lines that ran through his son's bedroom to kill the Internet. Jonathan rebraided the filaments.
Albert Gonzalez's parents, meanwhile, were waging a similar battle a few miles north in a Spanish-tiled home at SW 32nd Street and 64th Avenue. Their son was almost two years older than Jonathan and born to Cuban immigrants. His mother, Maria, had won a visa lottery on the island in the early '70s and moved to South Florida. Around the same time, his father, Alberto Sr., built a raft with two friends and launched it into the Caribbean Sea.
Two days later, a U.S. submarine found the men in the Florida Straits and called a cutter to rescue them. Alberto Sr. lived in Chicago for a few years and then moved back to Miami to start a landscaping company. After he met Maria and the couple married in 1977, they bought the house in Southwest Miami-Dade.
Young Albert earned money during summers picking up grass clippings for his father's landscaping jobs. By age 8, he'd saved enough to buy a PC. He flashed his natural brilliance two years later when a computer came down with a virus. "It upset him that his computer wasn't working right," says Rene Palomino, a family friend who, like Alberto Sr., was a deacon at the Prince of Peace Lutheran Church, and who later represented Albert as a lawyer. "That's how his fascination with what a computer is and how it works really started."
Like Jonathan's parents, Alberto Sr. and Maria began to worry that their rail-thin, pale son spent too much time online. "He was fascinated by this new technology," his sister, Frances Gonzalez Lago, says in a letter filed in court. "He would sit at the computer for hours at a time. He went from being an extroverted and talkative kid to quiet, introverted, and obsessed."
But the Cuban immigrants also hoped their son's skills could land him a lucrative career. "His dad said, 'It's better than him getting high or running around with gangs,'" Palomino recalls.
That attitude didn't last long. When the boy was still in grade school, Alberto Sr. grew so worried about his son's disobedience that he talked some friends in the local police force into helping him stage a fake arrest to try to scare him straight.
It didn't work. Halfway through his freshman year at South Miami High, when Albert was 14, real FBI agents walked into principal Thomas Shaw's office and asked to speak to the gawky kid with short-cropped dark hair.
Albert, it turned out, had been using stolen credit card numbers to buy CDs, shoes, and videogames. He'd have them shipped to empty houses for sale and then pick up the goods late at night.
He'd also been hacking for fun. Once, he'd found his way into the government of India's main site, where he left offensive jokes: "Why are your women so ugly?" and "What's with the red dot?"
But that's not what alerted the FBI. In early 1995, Albert had hacked into NASA's servers, Palomino recalls: "[The FBI investigator] said, 'We have no interest in prosecuting a 14-year-old. But we need to know: How did he do it?'"
Later that month, Palomino, Albert, and Alberto Sr. gathered in the FBI's Miami office. An expert spoke with the boy for more than four hours. "Hours in, the guy pulls us into the hallway and says, 'This kid is amazing. He's running circles around me,'" Palomino recalls.
The feds agreed to not file charges if Albert's parents took away his computer for six months. The boy returned to South Miami High, stayed out of trouble, and graduated in 1999.
But Albert was already developing a split personality. In public, he seemed like a decent student and computer savant. In the privacy of his bedroom, online, he transformed into "soupnazi" — an aggressive, macho hacker.
The summer after he graduated from high school, "soupnazi" talked to ZDNet magazine and boasted about breaking into the National Oceanic and Atmospheric Administration's system for the Keebler Elves gang. "Defacing a site, to me, is showing the admins, the government... that we own them," he bragged.
Albert was never pegged for that crime.
Jonathan James wasn't so lucky. On January 26, 2000, just before 8 a.m., Bobby James got in his car to leave for his job at county hall. He noticed a Pinecrest Police cruiser in his neighbor's back yard but didn't think much of it.
Suddenly, the lights flicked on. Bobby pulled over. As an officer walked up, three dark-tinted Lincoln Continentals screeched to a halt. His stomach dropped. "What did Jonathan do now?" the father asked.
The past year had been difficult. Jonathan had been suspended from Palmetto Senior High, where he was a sophomore, after he was caught stealing computers from a lab. Then his mother, Joanne, had been diagnosed with late-stage breast cancer. She'd recently had a mastectomy.
As cops entered the house, Bobby grabbed the lead agent's arm. "Listen, the bedroom you want is the first one in the hallway," he said. "In the back bedroom, my wife is 21 days postmastectomy. She will not be happy to see you."
From Jonathan's bedroom, the agents took five computers, a cache of burned CDs, and — bizarrely — his Klingon-language dictionary. "They thought he'd used it as an encryption tool, I guess," Bobby says, laughing.
Like Albert, Jonathan had hacked into NASA's computers. But the younger hacker had gone a step further. He had intercepted more than 3,000 emails and stolen data from 13 computers. The boy had even downloaded the program that controlled the climate on the International Space Station.
On March 20, Jonathan admitted he'd hacked the government and he belonged to the Keebler Elves. Prosecutors weren't satisfied. They were angry he'd told other hackers about his bust, which meant he couldn't be used in a sting. In September 2000, at age 16, he was sentenced to six months in a juvenile facility and probation until he was 21.
Jonathan wasn't contrite. The day after his sentencing, he called the Miami Herald to brag. He sent a photo of himself in dark shades and black clothes, strutting like Neo from The Matrix, his favorite movie.
He said he'd hacked BellSouth, the Miami-Dade public school system, and many others. "All the girls thought it was cool," Jonathan told the newspaper.
His hacking, he said, had helped the government by showing weaknesses in the system. Jonathan's dad felt impressed, even if warning bells were ringing.
"He really didn't feel that he'd done any malicious damage," Bobby says of his son. "But in hindsight, he was already showing some sociopathic tendencies. He truly felt that rules were meant for everyone but him."
In early 2007, Albert sat at a desk dwarfed by a towering mound of wrinkled cash. Hundreds of thousands of dollars in $20 bills were heaped in unruly piles as he chatted online with friend Stephen Watt.
Albert laughed as his automatic counting machine choked on the cash. "I'm trying to manually count over $340,000," Albert wrote to his buddy. "My f'n money counter just broke, 340,000, and it's all in 20s. ROFL!"
His grand criminal enterprise — which he called "operation get rich or die tryin" — had already brought regular payments of $10,000 or more from Eastern Europe, laundered through Latvian banks and then delivered by courier to drop boxes in South Florida.
In just a few years, he had evolved from hacking for fun to masterminding a series of massive online heists, to some extent with the help of Jonathan. Also involved were two of their friends from South Florida hacking circles, Stephen Watt and Chris Scott.
Albert had met Stephen when both were high school hackers. The seven-footer from Melbourne — a savant who graduated at age 16 from Melbourne Catholic High — had won admirers online by founding a hacking cartel called Project Mayhem. Chris, Jonathan's best friend at Palmetto Senior, was an overweight social misfit with a gift for computers. The four friends, according to Chris's mom, probably encountered one another at meetings of an underground hacker magazine called 2600 in 1999, when Albert was a high school senior.
Now, years later, the four had combined to hack into databases of some of the largest U.S. retailers and lifted millions of credit card numbers. They then manufactured cards using some of the stolen data. "These guys all started like me, hacking just to see what happens at first when you're still a kid," says E. J. Hilbert, a former FBI undercover agent who worked several cases connected to Albert's criminal ring. "Then you have to show off just to show what you can do. Finally, you... steal... That's when things really get serious."
But there was something the gang didn't know about their leader, Albert Gonzalez.
It had all begun after the handsome young Cuban with lively eyes and a buzzcut graduated from South Miami High in 1999. He enrolled in classes at Miami Dade College but soon dropped out to move to New York for a programming job with FortuneCity, a dot-com start-up. When the site went belly-up a year later, Albert found work with European engineering giant Siemens. A few months later, though, Siemens closed Albert's office and asked him to relocate to Pennsylvania.
He refused. Palomino says Albert had by then developed a drug habit — pot, cocaine, and amphetamines. He hooked up with a group of hackers that ran a site called ShadowCrew (slogan: "For Those Who Wish to Play in the Shadows!"). Their message board offered hackers a place to discuss topics such as "recreational pharmacy" and "physical ops." Mostly, though, it was a safe haven to buy and sell stolen credit cards.
By 2002, Albert had become one of the site's administrators, operating under the name "cumbajohny." Soon ShadowCrew had garnered more than 4,000 subscribers who traded more than a million stolen cards. But then the operation imploded.
In late 2003, Albert walked up to an ATM on a quiet New Jersey side street to test fraudulent cards. Local detectives happened to be staking out a grand theft auto ring nearby. They watched the then-23-year-old, who sported long, scraggly hair and a scruffy beard, feeding card after card into the machine. After stopping him, they discovered more than 75 cards in his pockets.
They passed Albert onto the Secret Service, which decided to use him to bring down the ShadowCrew.
Yet again, Albert seems to have set up a two-faced personality. For the federal agents, he played the part of a repentant hacker — sparing no effort to bring down his criminal coconspirators and pleading he'd joined them only out of curiosity.
But online, as investigators would learn years later, Albert was still "soupnazi," the kid who couldn't stop hacking for fun, for profit, and for the sheer joy of breaking the rules.
Days after his arrest at the ATM, "cumbajohny" was back at work at ShadowCrew. He encouraged site members to log into a secure network to sell the cards, supposedly for their privacy — but really so he could feed their identities to the feds.
On October 26, 2004, Albert organized an online meeting of top users. By the end of the day, "Operation Firewall" had ensnared 28 ShadowCrew members. The feds turned up more than 1.7 million stolen card numbers.
And Albert had found a new career. The Secret Service agreed to pay him $75,000 annually as a hacker/consultant. "He was doing what he loves to do," Palomino says. "And he was doing it legally with the government's consent."
Back in Miami, Jonathan James was struggling to readjust to life after serving six months of house arrest for hacking NASA.
At least one computer company offered employment afterward. But Jonathan wasn't interested. "That would have required actually, you know, showing up for work," Bobby says.
Soon after, the boy violated his probation by smoking pot. That earned him a four-month term in a Liberty City halfway house.
On February 10, 2002, breast cancer killed Joanne James. Jonathan, always moody, became depressed. In late March 2002, after violating probation again, he was sentenced to a six months at Three Springs, a youth facility outside Tuskegee, Alabama, where he was kept away from newspapers, books, and computers. The 19-year-old clashed regularly with guards. He was one of two white inmates in the facility, his dad says.
On New Year's Eve 2003, he was walking home from a party when a cop stopped him, suspecting he might have drugs. He didn't, but a speeding ticket had lapsed while he was in the halfway house, and he was booked overnight into Miami-Dade County Jail.
When Bobby picked him up at 10 the next morning, the young man said, "Dad, I'm never going to jail again. Never."
After his prison term, Jonathan grew closer to Chris Scott, who had earned a GED after dropping out of Palmetto Senior High. The pair drank, played Ping-Pong, and hacked. They also stayed in touch with Albert, who had bought a $118,500 condo off Bird Road.
Albert had already re-entered the world of illegal hacking — even as he infiltrated online gangs for the Secret Service. It wasn't long before he talked the two friends into helping him.
Their first big hack for Albert came in 2003, when Chris helped him break through an unprotected wireless system at BJ's Wholesale Club.
The next year, according to one federal indictment, Chris and "J.J." — probably Jonathan James — began "wardriving," as hackers call it, up and down U.S. 1 in Kendall. They looked for big companies' wireless systems on the thoroughfare and then hacked in to steal credit card data. On one of these tours, they hacked the OfficeMax on SW 109th Street.
Albert, meanwhile, recruited an itinerant hacker named Damon Patrick Toey to move into his condo. Damon had begun stealing credit cards online as an 18-year-old in Virginia, where he lived with ten other relatives in a tiny apartment. His mother was absent, "out partying every night and drinking," according to court documents. Albert offered Damon free room and board in exchange for help stealing data; his attorney later said the younger man was a virtual slave, trapped in the condo with no car or money.
By 2007, Albert, Chris, Jonathan, and Damon — with the help of a "sniffer" program, written by Stephen, that found weaknesses in security systems — had hacked a staggering array of companies: TJX Companies, which owns the T.J. Maxx and Marshalls chains; Dave & Buster's; Sports Authority; Citibank; a corporate payroll company called Heartland Payment Systems; and others. They worked with two mysterious, powerful hackers in Russia who helped direct them to targets.
After the gang members stole customers' credit card numbers, they had two options. With some of the data, they made fake cards and used them to withdraw cash from ATMs in Miami and elsewhere.
But the vast majority were fenced online. To sell the cards, Albert had hooked up with a 25-year-old Ukrainian named Maksym Yastremskiy, known online as "maksik." Maksym bought cards in bulk and then laundered Albert's payments through a site called eGold before depositing money into Latvian bank accounts.
In chats, Albert marveled at media coverage of his crimes. "I'm surprised [this latest theft] wasn't on the news, every hack i've made is on the news heh," he typed.
With his profits, Albert soon moved with his girlfriend into the swanky National Hotel, leaving Damon to toil in the shabby condo. He leased a 2006 BMW 300i and threw a $75,000 birthday party for himself. He made plans to invest in Stephen's dream project: a New York rock club.
Jonathan James wasn't living that life. He and his brother Josh lived rent-free at their childhood home, which their mother had left them when she died. Their dad had moved into his own apartment in South Beach. If his son was profiting from Albert's crimes, Bobby didn't see much evidence. "Jonathan took living with no cash to a new extreme," he says. "He was even scarfing wireless Internet from the neighbors."
On July 25, 2007, a team of Secret Service agents huddled inside a posh resort in Kemer, a seaside town in southwestern Turkey. Across the hall, Turkish secret agents slipped into a luxury suite and grabbed a Lamborghini laptop.
The laptop's owner, the Ukrainian Maksym Yastremskiy, was dancing at a nightclub nearby.
The Turks handed over the machine, and the U.S. agents began downloading data. When they finished, they put the computer back in Maksym's room and slipped out of the resort.
The agents had waited years for the hacker to travel to a friendly country where they could carry out this operation; in Ukraine, he was protected by corrupt officials. Turkish police arrested Maksym the next day. By July 30, he had provided his passwords and given investigators full access to his computer. Still, it wasn't easy to pin down his accomplices. Albert's team used secure communication networks that gave users long numerical IDs, not easier-to-identify nicknames.
"We had this evidence of these strings of numbers being connected to a crime," lead prosecutor Kim Peretti said in a recent interview with BankInfoSecurity.com. "But connecting the numbers to a person was really difficult."
Detectives focused on Maksym's chats with one American — 201679996 — who had sold him millions of stolen credit card numbers. They spent the next few months studying the data with experts at Carnegie Mellon University. By late 2007, they had linked the numbers to a Russian email address with a startling name: email@example.com.
Alarm bells rang across the Secret Service. Was their prize informant playing them? Then investigators found a chat in which 201679996 referred to himself as "segvec" — another nickname Albert had used in his ShadowCrew days. That sealed it.
The Secret Service immediately began investigating Albert. Soon they arrested an Estonian hacker and accessed two Latvian servers where they found more than 40 million unsold credit card numbers linked to the break-ins at U.S. companies.
After Maksym's arrest, Albert probably considered running. But he made no move to erase his links to the Ukrainian hacker. "I would have wiped all my drives clean, shredded all my paper, taken any evidence there was out of my possession," former hacker Mitnick says. "Then all you have is the logs, and they can't conclusively link that to you. I don't get it."
For months, Albert holed up in the National Hotel. He had cash — more than $400,000 on hand and another $1.1 million buried in plastic tubs in his parents' back yard.
On May 7, 2008, eight months after Maksym's arrest, the feds made their move, raiding Chris Scott's and Jonathan James's homes, Jonathan's girlfriend's apartment, and Albert's hotel room, condo, and parents' home.
They arrested Albert and Chris the same day. Damon was soon in custody too. Stephen Watt's role in the crime wasn't determined until August.
Jonathan wasn't arrested during the raids. For almost two weeks, he tried to understand why the FBI had targeted him again. Then, on May 18, a federal indictment against Albert Gonzalez was posted online. Jonathan read it and was shocked: Albert had been working for the feds since 2003.
Jonathan leaped to a quick — and tragically mistaken — conclusion: Albert had offered up Chris Scott to get out of the latest charges, and Chris, inevitably, would give prosecutors an even bigger morsel: Jonathan James, the young hacker they'd already sent to the slammer once before.
Jonathan grabbed a sheet of lined notebook paper and wrote in uneven but unrushed cursive strokes. "Story Time," he penned at the top.
"When I Googled 'cumbajohny,' what I saw blew my mind. Albert had been working with the feds since 2003. That means that for five years, he had been having people like Chris hack credit cards for him while he made money selling them over the Internet and then at the same time has his buyers arrested to please the feds," he wrote. "Talk about entrapment!"
Jonathan continued, "I honestly, honestly had nothing to do with [the TJX break-in]. Unfortunately, I don't picture the feds caring all too much.
"So despite the fact that [Chris] and Albert are the most destructive, dangerous hackers the feds have ever caught, they'll let them off easy because I'm a juicier target."
A few minutes later, Jonathan picked up a handgun and sat on the floor in the corner of his bathroom. He signed the letter: "Remember, it's not whether you win or lose, it's whether I win or lose, and sitting in jail for 20, 10, or even 5 years for a crime I didn't commit is not me winning. I die free."
Jonathan nestled the gun against his head, just over his right ear, aimed upward and to the left, and pulled the trigger.
Albert Gonzalez stood before a judge in a Boston courthouse on March 25. Maria and Alberto Sr. cried audibly in the front row. He wore olive-green prison garb and spoke in an even tone. "I stand before you humbled by these past 22 months," he said. "I'm guilty not only of exploiting computer networks, but of exploiting personal relationships."
It was the last day in a 22-month legal process — one of three criminal cases Albert faced in Massachusetts, New Jersey, and New York for the thefts he orchestrated in "operation get rich or die tryin." He faced 15 to 25 years in federal prison, and he pleaded with the judge for mercy.
He'd betrayed the Secret Service and cost U.S. companies and credit card users big money. TJX alone lost 46.5 million credit card numbers and spent more than $132 million paying back customers, fixing security flaws, and defending itself in lawsuits. Banks, retailers, and payroll companies racked up "hundreds of millions" in expenses, prosecutors said.
"He knowingly victimized a group of people whose population exceeded that of many major cities and some states," prosecutors wrote in a sentencing memo.
But Albert pleaded with the judge that he didn't do it out of avarice.
"I didn't throw it away because of egotism or greed," he said. "I threw it away because of my inability to stop my pursuit of curiosity and my addiction."
The month before, a psychologist named Barry Roth had testified that Albert might suffer from Asperger's disorder, which is similar to autism. He noted the hacker was "possessed by a twisted genius."
Palomino, in part, blames the Secret Service for not monitoring Albert more closely. "Sending him home with a laptop would be like a DEA agent sending a cokehead informant home with a kilo for the weekend and expecting him to come back with the whole thing on Monday," he says. "The guy had an addiction."
But the prosecution's psychologist, Mark J. Mills, argued that Internet addiction isn't recognized by mainstream medicine and that Albert clearly knew what he was doing when he stole.
The truth, perhaps, lies somewhere in the middle. Going back to his earliest days as a hacker, it's clear that Albert never really stopped breaking the law online — he just got better at pretending that he had reformed himself. And if his hacking was rooted in intellectual curiosity, by the end it was also driven by naked greed.
This past March 25, U.S. District Judge Patti B. Saris sentenced Albert to 20 years in prison, much of it to be served in isolation because of his role as an informant. He was also ordered to repay $69,143,862.80. Another restitution hearing is set for June. It was the stiffest sentence ever handed down to a cybercriminal.
Chris Scott received a seven-year federal sentence. Stephen Watt got two years and was required to pay $171.5 million in restitution. Damon Toey earned five years in prison. Yastremskiy was hit with a 30-year prison sentence by Turkish courts.
Prosecutors say two Russian criminals, identified only as "Hacker 1" and "Hacker 2," played a key role in all the thefts. They remain at large.
After Jonathan's death, Bobby James moved back into the Pinecrest home with his other son, Josh.
The house, still cluttered with Jonathan's books and videogames, has the air of a bachelor pad. The brick-lined pool out back is half-full of tea-colored storm water.
Bobby says he still struggles with Jonathan's suicide. He brushes his teeth every morning in the same bathroom where his son died. "I just try to remember the good times we've had in this house," he says.
He is still not sure how much of a role Jonathan played in Albert's scheme. He believes his son's claim that he didn't participate in the huge TJX break-in. "But I do believe that he was doing other illegal stuff for Albert," he says.
Bobby also tries to keep a sense of humor about his boy's brilliant and troubled life. He and Josh sometimes laugh about how confused Jonathan was when federal agents took his Klingon dictionary. They chuckle about the time he was desperate enough for cash to eat a whole jalapeño for $20.
A few weeks ago, Bobby printed simple white business cards with Jonathan's name, his date of birth and date of death, and this simple inscription:
"Google 'c0mrade hacker.' (Please Remember Me)."