Inside the Biggest Sting Operation Ever (with Michael Bobbitt)

0:03Hello, and welcome to the 404 Media Podcast, where we bring you unparalleled access to hidden worlds both online and IRL. 404 Media is a journalist founded company and needs your support. To subscribe, go to 404media.co. As well as bonus content every single week, subscribers also get access to additional episodes where we respond to their best comments. And they get early access to our interview series too, like this episode. Gain access to that content at 404media.co. So today, I'm speaking with Mike Bobbitt, who was stationed in The Hague during the Anom operation. This was the largest sting operation ever.

0:49It is when the FBI secretly ran an encrypted phone company in order to wiretap the world, capture the communications of organized criminals. They basically ran a tech company for drug traffickers and hitmen. So there's a fair bit of context that you need before you go into this interview. Some of you may know this because you may have read my book, Dark Wire, that's all about this operation and Mike comes up in that book repeatedly, or maybe you're new to this world. But to step back for a minute, for years, criminals have used encrypted phones. Like it used to be pages, right? than burner phones or a payphone if you watch The Wire or something like that.

1:37That's just not how it works really now that we're well into the 21st century. Drug traffickers, hitmen, money launderers, they use these devices which send, well at first it was end-to-end encrypted emails, then it became instant messages and now actually a lot of them are based on the signal protocol. Often they'll have a camera removed, the microphone as well, the GPS functionality. And the idea is that this is a device I can securely communicate with my fellow drug traffickers to organize my shipments or my assassination attempts or whatever and reduce the attack surface. So if law enforcement do try to hack into it or do try to intercept my communications, there's much less material for them to get.

2:30So going back, I think in around 2008, there is a company called Phantom Secure. It is selling these sorts of devices on the BlackBerry handsets. The FBI starts investigating that company. It eventually shuts down Phantom Secure. And there's a vacuum after that, right? Because these drug traffickers, there were thousands of them on phantom secure they need to quickly find another provider now some of them probably went to sky which was this massively popular encrypted phone company as well but another player emerged so in the wake of the phantom secure shutdown somebody who sold phones to phantom and for sky actually, came to the FBI with this really extraordinary offer saying, hey, I'm making the next generation of encrypted phone and I want to offer it to the FBI for you to use your investigations.

3:32And of course, there was money involved, a promise to drop or a lower sentence of charges this person may or may not be facing now or in the future. There was a transaction there, obviously but this company was called Anom so the FBI took it rather than trying to place a backdoor into an existing phone company because they did try to do that phantom secure they were just going to run the tech company themselves you know actually fund it help it grow as much as they could they didn't want to entrapment they didn't want to sell the phones to specific people but they wanted it to spread organically so they put in a backdoor that collects all of the messages sent across the NOM and the videos and the photos and the GPS location as well.

4:19And things get going. A NOM starts in Australia. It's very small, very much word of mouth, you know, single digit devices to start and then dozens. And then it becomes more and more popular until eventually, you know, the Italian mafia are using it inside Australia. Biker gangs, like the Comacheros, are using it, these really hyper-violent gangs, Hell's Angels as well. So it starts there. And then eventually, because of the globalized nature of organized crime, the criminals using these phones, well, they need to get them over to Europe now, where their collaborators and their co-conspirators are.

4:58These people need to be able to communicate. You can only message someone on a NOM if you're also on a NOM. There's no cross-pollination between these phone networks. So a NOM with the FBI's backdoor starts to move to Europe. And that's where Mike, the person I'm speaking to in this interview, comes in. In his role, he was relaying intelligence between San Diego FBI, with that field office leading the Anom operation, and Dutch authorities. Then his role does get a lot more involved, as you'll hear, and he sort of walks us through the Anom operation from the time when a norm lands in Europe. If you do want the rest of the story, of course, check out my book, Dark Wire, and there's plenty of coverage on forward4media.co as well.

5:46I'll put some links below. But other than that, here's the interview. I hope you enjoy.

6:01Thank you so much for joining us. and you're going to tell us all about Anom. I really, really appreciate it. You're welcome. It's good to see you again, Joseph. Absolutely. So listeners have just heard me explain the beginning of Anom, you know, the FBI launching its own encrypted phone company or rather taking one over and then growing it through various means, how it started in Australia, then eventually it lands in Europe, and that's where you come into the story. And we will get to that. But to back up a little bit, But can you tell us how you got into the FBI and the sort of work you were doing for the Bureau before Operation Trojan Shield?

6:42Like, what were you doing in the FBI before that? Sure.

6:49Well, my story is, it starts when I'm in university and I really have no idea what I wanted to do. So I'd always been drawn to serve my country, but the military was not something I'd considered, even though my father had been in the army.

7:08And between that and the fact that I became bored very easily and I knew I needed something with a lot of variety. So the idea of being a special agent with the FBI was introduced to me and I began to pursue it. And that led to a change in my field of study to become a CPA. I worked for Deloitte for just three years. And then I was fortunate enough that the FBI started hiring again during that period. And I was able to join. That was in 1998. Sure. So what sort of places and investigations are you doing at the start? Like what do they give to a new agent in 1998? It's funny you ask that. At the time, it was still the war on drugs was still really moving.

8:02So a lot of agents from my new agents class were going to the southern border. And so I went to Houston. And it was really a fantastic time. And I was fortunate to join the squad. DS6 was the name of the squad. And we were, to say we were a young squad was an understatement. We had one journeyman investigator. He, I think, only had five years in the FBI. Everybody else had three years or less. We were a squad of 12. I think there were three or four other probationary agents like myself. if my training agent had just gotten off probation months before. And I really had no context for what we were doing.

8:48We were addressing some of the most prolific Colombian cartels and Mexican cartels. I really had no appreciation. I didn't know what the Gulf cartel was and was fortunate to join two other case agents that were working the Gulf cartel and ended up dismantling the Gulf Cartel, and then had the opportunity to work on some Colombian terrorist organizations myself, following on from some really talented investigators that had started the case previous. As a young agent, really no appreciation for what I was dropped into. Had the opportunity to go overseas, worked in Budapest, Hungary, working Russian organized crime for quite a while, then moved to Thailand after six years, spent two years in Thailand, Then found my way to Denver and worked cyber intrusions, corruption, gangs, hate crimes, and a variety of other violations.

9:49And then at the very end, my family and I, we decided it might be nice to try to go overseas again. I had about 18 years in the FBI at that point and found ourselves fortunate once again. And we're in the Netherlands working with the Dutch National Police and Europol. yeah that makes sense how exactly do you end up at the hague just does just like the role come up and you can apply for it or it's offered to you like like how does that work exactly good question um the fbi has a large presence overseas uh we have representatives in every country or representing the FBI in every country for all criminal violations, national security matters, counterterrorism matters.

10:36But the numbers tend to be fairly low. So it's a very competitive position to obtain. And so I really count myself fortunate to have had the opportunity to go overseas again to the Netherlands and find myself in the Hagen. So this was a position I applied for and then was given. It was a specific position sponsored by the Criminal Investigative Division of the FBI and for the specific purpose of working organized crime that would be dark web matters, encrypted communications, some of your traditional oligarchs, things like that. Yeah, and of course, encrypted communications becomes very, very relevant a short while later.

11:24and I mean we'll get to that just before that you you become a legal attache right that's what the the title of this role is can you describe what exactly the the point of that position is like as you say the FBI is all over the world it has outposts and offices globally what is the purpose and the role of a legal attache sure that's a good question so the legal attache um who actually would have been my boss. I was an assistant to the legal attache. The legal attache is the FBI director's representative to that country. So they represent the entire FBI. They're the voice of the FBI to manage all the FBI's work with that country.

12:12So working very closely with the domestic security services, foreign intelligence services, and obviously law enforcement in that country yeah so you become you enter that role and you're in the netherlands um and you're how long are you doing work there before a nom comes up is it like a couple of years something like that it's a couple weeks actually so but i didn't know i didn't know it was a so in my in my hand off with my predecessor uh he's taking me to meetings and he says you need to come meet this unit of the Dutch National Police, we've been passing them some intelligence from FBI San Diego.

12:59It's a fairly sensitive operation related to organized crime, and that process should continue. And so it was just in the first couple of weeks with no context, no idea where the information is coming from, just that the FBI is passing intelligence to the specific unit of the Dutch national police. Yeah, so they haven't told you yet that there's this phone company called Anom and the FBI is secretly running it. When do they tell you that? And sort of what was your reaction to learning that this wasn't just an ordinary operation, this was, oh, the FBI is running a tech company, basically? It was actually quite a bit later.

13:39You may or may not know, but the FBI takes information security pretty seriously. So there are things, even though you have the highest level clearances, if you don't have a need to know, even within a specific investigation, you won't be privy to that information. So I knew FBI San Diego was collecting intelligence. I didn't know how. At first, I suspected it was through a human source. As I passed more and more information to the Dutch and that information began to broaden. It became apparent to me that it was a technical collection, but I didn't know anything more than that. And I didn't ask.

14:19So it wasn't until quite a bit later, a couple months later, where more and more was being passed and it became clear to me that they were collecting from telephones. But even then, and I didn't know the nature of the telephones. I had never heard the name Anam. And then obviously, once we started to push into expanding with our Dutch partners and then push into Europol, that's when things became more clear. So you're getting this information, as you say, at the start. It's like, huh, maybe that's a human source. Then there's a lot of it. So it would be a rarely prolific human source to provide all this information.

15:05That sort of theory goes out the window. But you and the Dutch authorities start acting on this information. The way we've spoken about it before is that you would get these phone calls from your colleagues at FBI San Diego, and they would relay some sort of piece of information. Maybe there's a drug shipment going on. Maybe there's some sort of threat to life. I mean, in some cases, even the kidnapping, right? Can you walk us through what you were doing there? You would get the phone call or receive the information some other way. What happened then when you got the information? Sure. So I moved from passing information just on one particular cell, one particular, I'm sorry, we have a name for them.

15:53And it's just a syndicate. Syndicate. Thank you so much, Joseph. I'm glad you remember the case better than I do. I was only passing information on one particular syndicate when it became clear that there were additional syndicates that the Dutch needed this intelligence on. And they continued to go to that same unit. And so in this process, not only did I get access to Ola, I bought myself and started to search some of these syndicates that related to the Netherlands. but obviously FBI San Diego continued. They were calling me, as you say, and saying, by the way, there is a drug shipment coming in.

16:33Two days from now, it will arrive into the Netherlands. Can you please work with the Dutch and see if they can action it and do it in a way that will preserve the integrity of the collection platform? So this is when I was beginning to learn what Anam really was, how it had been pushed out, the vastness of it. And so that was part of the work is sort of making sure that drug shipments enforcement action was occurring in a safe manner, in a secure manner, to serve our Dutch colleagues as well as continue the integrity of the platform. Sometimes this became more challenging as, as you say, there were threats to life.

17:18This was one of the primary responsibilities of the FBI to review all the information that was coming in and ensure that a norm was not being used to facilitate somebody being killed. But those would come to me at all times, day or night. I would reach out to a specific point of contact within the Dutch. We would work out how this would unfold. He would contact the tactical units that would actually unless we would agree on what information would be passed, what wouldn't be passed, what the nature of their tactical operation would include as not to, well, say, to keep our subjects off the path of where they may be getting compromised and help them to think maybe somebody turned us in, maybe there's a snitch someplace, perhaps there's a camera outside.

18:13I don't know what it is, but we don't want them to think that it's their encrypted communication platform. Yeah, there's a few different tensions there where even though you've got the information and maybe at this point or later on, you personally know it's a nom. Maybe even the Dutch officials that you're communicating with know as well. but say the SWAT team on the ground or whatever, they're probably not going to know it's a norm because you don't want that information to leak out, right? That's one way it could potentially leak out is, you know, through lower ranking people, just potentially, right?

18:51The other tension is that if you move too aggressively and too quickly on like a certain shipment or or some sort of other activity going on, it could become very obvious that it's the phones that have been compromised. How did you deal with that tension of, well, let's not go too hard, but we still want to do our jobs as well? How did you deal with that? Well, first of all, the Dutch are incredible professionals in this field. They had a lot of experience with encrypted communications in the past. They have a lot of experience with handling large drug trafficking networks in the past. And then on top of it, I would say the unit that I was dealing with was perhaps the best of the best.

19:42I mean, they really were professional, not only in their capabilities, but in their collaboration. And so we had a level of understanding that once they came to understand, and I sat down with the leader of that unit, I told him exactly what this was. the degree of partnership that we wanted, the access we wanted them to have through FBI San Diego and Ola Ibot, they wanted the platform to stay strong for as long as possible as well. They could see the value in this. And so we just had a natural, strong partnership there. And with that motivation to work together to find solutions. So you pull as many tools out of your toolbox as you can.

20:27When you send that tactical team out there, obviously they need to be safe. They need all the details that they could possibly have, but you provide instructions and you say, hey, lead them to believe that maybe there was a tracker on the car. Make it look like you pulled a tracker off the car. And now they think that's where this is coming from. Or maybe plant the notion that somebody's brother or family member may have called the police and accidentally said something. So you use different techniques and they seem very simple, but you lay them, you layer them together so that you can plant doubt in their head.

21:05They already want to believe that this platform is, um, not able to be compromised. And so they're, they're already going that way. Um, there were times where you would ask them to take additional steps. So you might know the load is coming in, say, through a Dutch port, but it's headed to Poland or it's headed to Germany. And we would ask the Dutch, can you not take it off here? Because that's where the devices are. Can you work with the Germans and let it transit all the way into that particular town, that target town in Germany, and then take it off there? Because they'll never then connect that seizure back to the group that has the encrypted devices.

21:51and with these partnerships um it was just amazing and these professionals are able to do that sometimes you can't and and i think you wrote about it in the book joseph where you get a call hey there's a lab and it's sitting right next to um a kid's daycare and it's just do what you got to do you know you you make it you make it as a um as safe as you can as quickly as you can and you hope the platform can endure that and obviously we did so yeah um yeah there are a few examples in this overarching story in the book where authorities just had to act basically there wasn't really um maybe the time or the space to well let's let let's let this drug shipment go slightly and then other authorities can get it as you say if there's a lab above a daycare or whatever authorities are going to want to act.

22:45And, you know, just to stress, like, letting drugs walk, that's the phrase, right? Obviously made famous by shows like The Wire and that sort of thing. I mean, I remember speaking to some of, you know, your colleagues in San Diego, and they understood that's a controversial practice, ordinarily. Now we're doing it on an international scale, and it paid off in many respects, right? You know, tons of drugs seized, all of that. But it's not a decision that should be taken lightly. I don't think people took it lightly either, right? It's just like very complicated decisions going on that people had to deal with every single day.

23:24Can you briefly describe, I mean, I'm not expecting you to remember maybe the names of specific criminals or anything. I mean, I could. Maybe I'll get into that later but what sort of tier of criminal are we talking about that was using an arm are these like low level guys are they pretty high level like what was your impression of the sorts of criminals that were using this up um that's a great question and um the answer to the question also highlighted, it really turned the light, I should say, on the vastness of the number of criminals in this category. We assumed, and when I say we, this was long before I was involved, the case agents in San Diego and all their partners early on assumed, based off of previous platforms that we would only have the highest level of criminal groups.

24:26Obviously, there would be users that were using the encrypted devices that were mules, that were just transporting money and things like that. But because of the cost of the device, because as you know, you couldn't just run down to Best Buy and pick them up. You had to buy them from a criminal group, and those groups were at high levels. you only had the highest level of criminals utilizing these networks. And so we assumed there would be X number of groups that would use them. We had no idea just how many high-level criminal groups were out there. And I think all our partner countries were shocked by that.

25:11And it goes to show that they need communication devices desperately. they need means to to to plan and execute their their drug trafficking murder for hire money laundering corruption everything that we found yeah um i think it was an official uh euro poll i spoke to about it who said you know they had some sort of understanding of the criminal the organized criminal underworld and it was x number billion dollars or whatever and then when a norm happened and then the Relators investigations into EncroChat and Sky as well, which were in a way all part of a single overarching campaign to undermine the encrypted phone industry for criminals.

25:56When those were done, this official said, well, it basically tripled our estimate of actually how big the criminal underworld was. So it's not even just revealing specific criminals, is revealing, oh, this is the actual scale of what we're dealing with here. Do you agree with that? Is that kind of what you were seeing as well? Yeah, there's no question. I mean, the math had to change because no one expected those numbers to show up. And we were not seeing one kilo, two kilo. We were seeing 1 ,000 kilos, 5 ,000 kilos, 2 ,000 kilos. The numbers were amazing. The number of attempted murders were amazing.

26:44I mean, we didn't expect to see that level of criminality. Yeah. And Andrew Young, who was at one point the lead prosecutor on this case before he left the DOJ, He was also, you know, blown away by the public corruption, which you don't really ever see that because they're people in positions of power, in positions of authority, who are abusing and exploiting that position. So they pretty rarely get caught. But Anom, EncroChat, that sort of thing, it revealed that capacity as well. So you're getting all these tips. You're acting on them. eventually, as you say, the Dutch are actually given direct access to Holeribot as well.

27:34But that can only go so far as well. Eventually, Europol, as a much larger organization, becomes involved. Can you just walk us through how that comes about, Europol's involvement and why bring them in? Why do this very complicated and very large collaborative effort? But as you may know, FBI San Diego's original plan was to bring all these partner countries from all the relationships that they intended to capitalize on from the different legal attitudes around the world, these trusted partners. They wanted to bring them all to San Diego. And there was this little thing called COVID. And it messed that up as well.

28:24and really had a big impact. And so at the time, we weren't able to bring those partners into the United States. It just wasn't going to be possible. And so FBI San Diego, they thought, well, maybe it's easier if most of our partners are European partners and we can travel within Europe. What if we take them to one central place? So we proposed as a group different locations. And then they came to me and said, Mike, it just makes sense. Could we set up something, some sort of group at Europol where we could bring all the partners together? And I don't remember how many there were at the time, about half as many as we ended with.

29:15And frankly, it sounded like an awful lot of work to me. And, uh, I was not interested. I also knew this would be difficult because, um, Europol is a place where you go to share information and you do it in an open fashion. Um, it, it is, it is about bringing together as many people as possible and getting things action quickly. But what we needed in this case was a very surgical, close-hold way to share very specific information among a very small group. And we needed to do it in a way where perhaps specific people from a partner country were there receiving information, but even their Europol representative didn't know.