The Digital Black Market and Identity Data: An Overview

The Digital Black Market and Identity Data

The term “black market” evokes images of shady deals and nefarious activities, but the reality is that it is a multi-billion-dollar industry in identity data. With technology advancing at an unprecedented rate, so have criminals.

From harvesting personal information from breached databases to selling stolen credit cards online, the black market for identity data remains very active today, illustrating both the risks of having our personal information stored on digital networks as well as how much value this information holds even outside its intended usage.

In this blog post, we’ll explore what exactly makes up the black market for identity data, where it exists, and how individuals can protect themselves against any potential losses or damage arising from black market identity theft.

Black Market Identity Theft

Get to Know the Mysterious World of the Dark Web

So…what exactly is the dark web?

The dark web is a clandestine network of websites that are accessible only through specialized software and operate on an encrypted network. Its use of anonymity makes it a favored platform for criminal activities, such as the illicit trade of drugs, weapons, and stolen personal information on black market websites.

The surface web, the deep web, and the dark web are the three main layers that make up the World Wide Web. You are most likely on the surface web when you conduct searches, read articles about growing lemons from websites, or shop for wedding accessories online. This area of the internet is well known to many people.

You can access the deep web by logging into your email. Password-protected data is stored in this section of the website. The deep web contains all of your email, financial information, and online health records. The deep web, also referred to as the hidden web, is about 400 times larger than the surface web.

The deep web includes the dark web. Additionally, the dark web is invisible to regular web browsers, unlike the other layers of the internet. The dark web can only be accessed by users with specialized hardware or software. Users on the dark web are anonymous, and neither their behavior nor their IP addresses are monitored.

Over 2.5 million people per day have been using the dark web in 2023. However, from mid-April 2023 onward, there was a steady rise in daily users, who averaged about 2.7 million. To access and use the dark web, users need to possess a particular set of technological abilities and knowledge.

Is the Dark Web Illegal?

Although the dark web is frequently linked to illegal activities, some trustworthy companies and organizations do use it. To send and receive messages secretly, dark web technology was developed by U.S. military researchers.

To keep sources’ or whistleblowers’ identities secret, some journalists use the dark web. Additionally, news organizations use it to open up access to journalism in locations where it is blocked.

The dark web, however, should not be used by individuals who are not knowledgeable of the technology and risks associated with it because it is not a secure environment. The dark web’s ability to provide anonymity can attract criminals and hackers who want to take advantage of unsuspecting people.

Due to the anonymity of its users, the dark web is also utilized by criminals as an online marketplace for illicit operations like the sale of stolen data.

How Does the Black Market Work?

How Does the Black Market Work?

In today’s digital age, personal data is a valuable commodity, and the black market for this information is a serious worry for both individuals and corporations.

The dark web offers a marketplace for buying and selling private data, but it’s also a location where users may hide their identities and their transactions. It is difficult to put an end to fraudulent operations or repair the harm done to customers because of a lack of control and common security measures.

Cybercriminals use a variety of techniques to steal personal information, such as malware, phishing schemes, and confidence tricks, via emails, social media platforms, and digital accounts. Cybercriminals may occasionally use sophisticated hacks to access corporate databases.

Once they have access to personal information, criminals may use it for their own gain or sell it on the dark web. Cybercriminals can operate freely and generate money from the black market for personal data on the dark web due to their anonymity and lack of oversight.

The Stages of the Digital Black Market

Stage 1: Malware creation to undermine internet security for users

Every virus, worm, bot, and other piece of malware is created by a specific company. The leaders of criminal organizations coordinate with programmers to develop malware, hackers to infiltrate networks, or other con artists to develop spam and phishing attacks. Windows users and online users who have been conned when looking up specific information, conducting banking transactions, or using networking are frequently the victims.

Stage 2: Involve promoting illegal products on the internet

Like legitimate commodity markets, the black market on the internet is extremely competitive. Cybercriminals must market their commodities to other criminals to be profitable. They design promotions, displays, service warranties, and even discounts for large purchases, all of which are advertised on secret forums and occasionally on social media.

Stage 3: The selling process

The offer of one cybercriminal piques the interest of another. Negotiations with the customer or vendor take place over private chat or email using generic addresses. Existing underground internet businesses are used to distribute the products. The method of payment is chosen, and it should always be one that is accepted by all parties. Contact customer care if the product isn’t working; for instance, if a credit card number isn’t legitimate, they’ll replace it with one that is.

Stage 4: Money laundering

This stage relates to online criminals who use bank transfers to steal money from victims’ bank accounts. This is dirty money, and it needs to be cleaned before it can be used on genuine markets. At this point, new victims enter the picture: money mules who were seduced by online scammers with false employment promises. They are given large rewards only for locating stolen money in their bank accounts and moving it to foreign accounts owned by cybercriminals. Both the physical and online security of these victims are at danger.

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What Sort of Information is Available on the Dark Web?

Personal information such as the following is commonly bought and sold on the dark web:

  • Counterfeit money
  • Drugs, including prescription drugs and illegal drugs
  • Fake diplomas
  • Fake IDs
  • Guns and other weapons
  • Information regarding bank accounts, credit cards, and debit cards
  • Passwords for subscription services and social media accounts
  • Personally identifiable information, such as one’s name, date of birth, SSN, or driver’s license number
  • Pirated software and media
  • Phone numbers
  • Malware
  • Medical records

Each piece of private data carries a price. For as little as $1, a social security number can be acquired, which can then be used to create a synthetic identity. Banking information, debit cards, and credit cards could sell for up to $110. For non-financial institutions, usernames and passwords cost $1, whereas login credentials for online payment systems might cost anywhere between $20 and $200.

There are other types of information that might sell for hundreds or even thousands of dollars, like:

  • Diplomas
  • Passports
  • Medical documentation

You can be sure that even seemingly insignificant amounts of data soon add up when they are obtained because of a significant data breach or a successful phishing attempt.

Prices fluctuate like they do in every market, so criminals wait for the right time to sell your data; it can even be years before they do anything with the information they stole. As a result, an issue might not become apparent until much later than the initial event.

What Causes Personal Data to Wind Up on the Dark Web?

If someone discovers your personal information on the dark web, it may indicate that they obtained it against your will.

Criminals use a variety of methods to steal personal data. Some people attempt account hacking or use malware to collect credentials. Others try to obtain information by using SIM swaps and phishing scams.

Scams are not all high tech, though. Some thieves would even search through the trash for papers that contained personal information.

The Perils of Utilizing Stolen Identity Data

Criminals can utilize personal information they have obtained through hacking, phishing scams, or data breaches to engage in several different types of identity theft, including:

  • A new credit card account is opened
  • Applying for government benefits
  • Bank transfers and transactions that are fraudulent
  • Obtaining mortgages and loans
  • Submitting false tax returns

For both the victim and the person using the stolen information, exploiting identity data might have serious repercussions. Financial loss, harm to one’s credit score, as well as a great deal of stress and frustration as they try to fix the problem, can all be experienced by identity theft victims.

>> Read more. Learn the differences between identity theft vs identity fraud.

Lifelong Impacts

Once the relationship between a customer and a business has been repaired, the costs of data breaches continue. Instead, stolen data is permanently accessible on the dark web and can be bought, sold, or used in various ways. Following the theft of an identity database, it is utilized for:

  • Creating fake identities and using deep fakes in identity fraud
  • Compromising email accounts
  • Rerouting mail to fake addresses
  • A credit card account is opened in the victim’s identity
  • Using a fake persona to make purchases online
  • Submitting applications for student loans, state benefits, auto loans, and mortgages
  • Using fictitious documents to gain access to online banking

How to Prevent Yourself from Experiencing Identity Theft

There are many techniques to prevent identity fraud that businesses and individuals can use. Some of the best methods include:

  • Keep your social security number privateYour social security number is the ultimate key to your personal information. Safeguard it at all costs. Question the necessity and security measures of any request for your number. Leave your card at home. Safely store or shred any documents that contain your social security number.
  • Set a credit freezeTo prevent the opening of new credit files, you can freeze your credit with each of the three major credit agencies (Equifax, Experian, and TransUnion). Freezing your credit is the strongest defense against identity thieves using your data to open new accounts. You can unfreeze it if you need to start a new account, and doing so is also free.
  • Passwords should be strong, and authentication should be includedCreate and save complicated, one-of-a-kind passwords for your accounts using a password manager. Use unique accounts only. An authenticator app can help you minimize your risk. Be careful what you publish on social media to avoid disclosing important information or revealing how you typically respond to security concerns. This is one of the biggest ecommerce identity fraud risks.
  • Watch out for phishing and spoofingBeware of scams! Scammers are getting clever, making calls and emails seem legit to trick you into giving up personal information. Don’t fall for it. Take control. Instead of answering, proactively reach out to businesses or government agencies through an official and reliable source. And be cautious of attachments; they could be hiding dangerous malware.
  • Take advantage of alertsStay informed about your account activities with convenient notifications. Sign up to receive alerts via text or email whenever transactions occur on your credit cards, or withdrawals and deposits are made on your financial accounts.
  • Utilize a digital walletUse a digital wallet, an app that contains safe, digital copies of your credit and debit cards, while making online or in-person purchases. It can be used at a suitable checkout terminal or when shopping online. The tokenization and encryption of transactions make them more secure. Additionally, there are less health hazards with contactless transactions.
  • Pay attention to financial and medical statementsRead account statements carefully. Verify that you can identify every transaction. Remember the due dates, and if you don’t receive an unexpected charge, contact the appropriate party to check. To prevent health care fraud, review the “explanation of benefits” statements to ensure you comprehend the services offered.Check all your monthly account, credit card, and other bill statements for any purchases that don’t seem right. Or, even better, create an account on the secure website of the business and check your account there every few days.
  • Shred! Shred! Shred!Some thieves have been known to search dumpsters and trash cans for your financial information. Use a crosscut shredder to destroy financial documents once you are done with them. You might also keep an eye out for local shredding events.

The Protection Offered by Identity Verification Services

The irony of identity theft and financial crimes is that most PII losses happen because of businesses’ poor internal security policies, which act as a backdoor for criminals. While phishing or data breach assaults cannot entirely be prevented, businesses can stop identity thieves by using automated identity verification tools.

These tools are used during the first phase of customer onboarding and are powered by AI technology. When a victim’s bank account or patient health portal is attempted to be accessed by an identity thief, for example, AI models effectively detect discrepancies in the information to identify phony or counterfeit identities.

Additionally, biometric facial recognition technologies can be used to offer remote identity verification via face scans. These techniques not only stop identity fraud during the initial account opening process, but they also enable businesses to adhere to the mandatory KYC laws and requirements.

Businesses can strengthen security with 2-factor authentication to prevent customer accounts from being taken over by thieves. In this manner, the 2FA code given to the victim’s mobile device is rendered unavailable if an account has been entered into by a criminal.


Customers and businesses alike are faced with a choice: either reject the idea of supplying identity information online and forego convenient digital services in light of the burgeoning black market for identity data or protect the data by utilizing cutting-edge solutions. One practical approach for combating identity fraud and ensuring the ultimate preservation of millions of customer records online is AI identity verification.

Want to learn more about our identity verification software? Contact us to schedule a consultation and witness a demo firsthand!

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