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Sex, Drugs, and the Biggest Cybercrime of All Time

The fast times & hard fall of three teenage friends with a knack for illegal code

Stephen Watt (left) and Albert Gonzalez in the hot tub at the Hotel Rivington after their joint birthday party at Sky Studios.
Courtesy of Stephen Watt
June 10, 2010

They'd been high all weekend long — on Ecstasy, coke, mushrooms and acid — so there seemed little harm in doing one last bump of Special K while they packed up to leave their $5,000-a-night duplex in South Beach. For the past three days, the three friends had barely bothered leaving their hotel, as a dozen club kids in town for Winter Music Conference, the annual festival that draws DJs and ravers from all over the world, flocked to their luxury suite to partake of the drug smorgasbord laid out on the coffee table. But even stoned on industrial-grade horse tranquilizers, Albert Gonzalez remained focused on business — checking his laptop constantly, keeping tabs on the rogue operators he employed in Turkey and Latvia and China, pushing, haranguing, issuing orders into his cellphone in a steady voice. "Let's see if this Russian asshole has what I need," he'd say calmly. Then he would help himself to glass plates of powder, each thoughtfully cut into letters for easy identification: "E" for Ecstasy, "C" for coke.

Photos: Inside the Wild Lifestyle of the Hackers Who Pulled Off History's Greatest Cybercrime

Albert's two friends were in no shape to think about work. Stephen Watt, a freakishly tall bodybuilder, was planted on the big leather sofa, immobile as the hotel suite's potted palm. Only 23, Watt was the group's coding genius, who until recently had been employed in the IT department at Morgan Stanley, the giant Wall Street investment bank. Patrick Toey, 22, Albert's most loyal foot soldier, was lazing around the suite, staring at the Miami seascape through the two-story picture windows, letting his thoughts drift.

"Listen, I need you to do this now," Albert was saying in a firm voice as he set his laptop on the desk in the master bedroom upstairs. For weeks, he had been badgering Stephen, known in hacker circles as the "Unix Terrorist," to refine a crucial bit of code for him. They were in the midst of pulling off the biggest cybercrime ever perpetrated: hacking into the databases of some 250 companies — including Barnes & Noble, OfficeMax, 7-Eleven, Boston Market, Sports Authority and DSW — and stealing 170 million credit-card numbers. But unless Albert could get Stephen to focus, the whole thing was in danger of falling apart.

"Now that I've got you here, I need you to do it, or it's never gonna happen," Albert urged. The whites of his brown eyes had gone veiny from the K, but he was still the ringleader, still in control.

Stephen somehow managed to climb the suite's glassed-in staircase and sit down in front of the laptop, but nothing he saw on the screen made any sense — his brain was scrambled beyond comprehension. "Dude," he wailed, "I can't fucking read!"

Albert didn't miss a beat. "Patrick, what about you?" he called out. "You sober enough to do this?"

Patrick moved toward the desk as if underwater. "Uh, this is going to be difficult," he said. "But at least I can read."

The American Wikileaks Hacker

Stephen pitched over onto the master bed, where, eyes closed, he groggily dictated code to Patrick, who laboriously typed it out, letter by letter. The task at hand seemed impossible, given their chemical impairment, but Stephen was notorious among hackers for his ability to dash off intricate code that could blast through even the most secure computer networks. Finally, after 10 minutes of following Stephen's directions, Patrick hit the "return" button and declared the program functional. "Thank God," Albert pronounced, his eyes widening with relief and excitement. Together, the three friends had just succeeded at putting some finishing touches on a vast criminal enterprise, one that U.S. Attorney General Michael Mukasey would call "the single largest and most complex identity-theft case ever charged in this country."

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