Here's a summary of interesting developments in intellectual property, technology, social media, and Internet law for the week ending May 10, 2019.

Social Media As An Evidence Tool: Uncovering Fraud With Social Media Technology

Unknowingly, the children of wealthy parents have been unwittingly providing evidence against their parents through social media platforms when posting photographs of their luxurious lifestyles online.  It has not been uncommon for some of the super-wealthy and affluent to attempt to hide assets from taxation and government scrutiny by bookkeeping trickery or simply moving assets overseas.  While some families choose to significantly underreport their earnings or assets in order to avoid paying high amounts of taxes, their lies have become increasingly exposed through social media as an evidence tool.  

Fraud Investigators Increasingly Look to Social Media for Uncovering Evidence of Fraud

Fraud investigators report they have been able to use social media technology as evidence to prove the hiding of assets.  While many perpetrators (i.e., parents) are not themselves on social media platforms, their children often post daily, or even hourly, on platforms such as Instagram, Facebook, and Twitter.  These posts that often include photographs of extravagant vacation resorts, expensive cars, or even stacks of cash can now be used as evidence against people intending to hide such wealth.

Recent studies in the field revealed utilizing social media as an evidence tool now comprises up to 75 percent of evidence used in such litigation cases.  For example, in one debt recovery case where a man claimed to have no assets for repayment had his lies revealed when one of his children posted a photograph of the family’s $22 million yacht while vacationing in the Bahamas.

Geolocation Technology in Social Media Acts As Tool For Evidence Discovery

In many of these cases, investigators also use the geolocation of where the posts to social media were made to help build their cases.  Investigators have been able to find significant amounts of unreported assets and money by cross-referencing social media posts with land registries overseas.  With such specific evidence turned over to the courts, these assets that previously were often concealed overseas can now often be found with specificity.

Investigators have also been able to use such posts to build up profiles on not only the intended targets but on their associates as well.  More specifically, because the like-minded perpetrators often run in the same social circles, investigators have been able to use social network posts to catch associates or build parallel profiles on targets that have been under the same scrutiny. 

Social Media As An Evidence Tool To Catch Hackers

Investigators have also been able to use social media posts to track down hackers of social media accounts and protect or recover the assets of those being hacked.  Information disseminated in social media can often leave hints for hackers to strike. Wealthy families that have fallen victim to hackers being able to guess or crack passwords to their social media accounts have also been able to use investigators to track down hackers based on fake social media posts.    

How Will Innovations in Social Media Technology Influence Evidence Gathering for Fraud?

As technology continues to evolve and new innovations are created in how information is dispersed in social media, we can expect that investigators will be able to use such social media tools as evidence with increasing efficiency and speed.  Intellectual property attorneys also often use social media to identify, track down, and or prove IP infringement. 

Read the full article here.

The Digital Black Market and Dropgangs: The Evolution With Technology

In today’s age of Internet and innovation, it comes as no surprise that new technologies are also being used for more nefarious reasons.  For example, with the rapid innovation of wireless technologies, mobile applications, and the Internet of Things, experts have now also seen the reemergence of the digital black market.

What is the Digital Black Market?

While the black market has always existed on the Internet in some form or fashion, the most infamous presence of the black market on the Internet was what many referred to as the “dark web” or “dark net,” which usually meant a website hosted on untraceable and anonymous networks like Tor or l2P.  This digital black market would offer digital access and allow digital purchasing of illicit products and services that many would not dare to attempt to procure in the real world.  The dark web offered for sale both goods and services that would include, for example, stolen and pirated software, pornography, drugs, pharmaceutical pills, false identification papers, and even firearms or assault weapons.

While the dark web websites were usually quite basic and fundamental in appearance, they all still had the requisite functionality important to any Internet web-market portal such as infrastructure that supported private communications, buyer/seller reputation tracking, and sophisticated escrow services for payment, and forums in which both merchants and buyers could contact and communicate with each other.  At the same time, having such a centralized web portal often made these black markets the target of sting operations and law enforcement takedowns.

How Tech and Crypto Helped Revamp the Digital Black Market

With the explosion of cryptocurrency and mobile applications, however, the digital black market has reinvented itself.  Now, merchants are able to use more decentralized technology to operate invite-only transactions through mobile messaging programs like Telegram.  If the buyer becomes a repeat customer, they can be given different and unique messaging contacts that are different for each purchase and never tied to shared, permanent channels, which make these transactions much less vulnerable to law enforcement takedowns.

Find the full article here.

Click to read the previous Weekly IP Buzz.

For more posts, see our Intellectual Property Law Blog.

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Darin M. Klemchuk is founder of Klemchuk LLP, a litigation, intellectual property, and transactional law firm located in Dallas, Texas. He also co-founded Project K, a charitable movement devoted to changing the world one random act of kindness at a time, and publishes Thriving Attorney, a blog dedicated to exploring the business of the practice of law, productivity and performance for attorneys, and other topics such as law firm leadership and management, law firm culture, and business development for attorneys.

Click to learn more about Darin M. Klemchuk's law practice as an intellectual property lawyer.