A Drug Kingpin Ran His Empire from a Laptop, Then Snitched on His Own Assassins

Pain pills in the US. Meth from North Korea. Shipments of gold. Yachts full of cocaine. Contract killings. They all added up to a witness for the feds.
Paul Le Roux is a bad man.
Stock image via Getty. Social image of Paul Le Roux via Galeao Airport Security

Before he was an informant implicating former American soldiers in mercenary-style slayings on behalf of a global drug and gun empire he controlled, Paul Le Roux was a guy with a computer.

The South African national helped develop E4M—or "Encryption for the Masses"—in the 1990s, software that, along with the hard-disk encryption program TrueCrypt that followed, promised to make it easier for online sleuths to avoid detection from prying eyes, at least for a while. He used that anonymity to assemble what federal prosecutors have since described as a uniquely sprawling criminal empire, running the show from his laptop in the Philippines, and later in Brazil. Among other wares, he has admitted in court to selling drugs, guns, chemicals, missile technology, and murder-for-hire contracts. His network appears to have included contacts with Latin-American drug cartels, Chinese gangsters, guerrilla fighters, ex-European soldiers, Somali Warlords, and possibly even officials from rogue nations like Iran and North Korea.


But he was busted in a sting meth smuggling deal in Liberia in 2012, and Le Roux flipped in hopes of reducing his sentence. This past spring, he served as a key witness in a murder trial that convicted three of his own former henchmen in an assassination he ordered (the victim seemed to have stolen from him, he said), as the New York Times reported. His is a long, strange saga involving smuggled gold, car bombs, a yacht full of cocaine (and at least one dead body) crashing ashore, and plenty of murder for hire—one that, as VICE News reported, raised questions about just what kinds of characters the US government cooperates with to make cases stick, and at what cost.

In his forthcoming book, The Mastermind: Drugs. Empire. Murder. Betrayal, Evan Ratliff, who dug into the case in a series at the Atavist magazine, explores the incredible story of the programmer-turned-criminal supervillain. VICE talked to Ratliff about how what was, at its core, an illicit ecommerce empire actually operated, and what inspired Le Roux to cooperate with DEA agents and turn on some of the very same operators who once made his reign possible.

VICE: How did Le Roux first get your attention? Given the obsession Americans and basically everyone has with colorful criminals, it seems like he has largely fallen under the radar, even as he was a key witness in a recent murder case in New York.
Evan Ratliff: I first heard about things related to Le Roux back in 2013. That’s when they arrested Joseph Hunter, whose nickname is Rambo, for agreeing to [attempt to] kill a DEA agent. But at the time, Le Roux's name was still secret. They were still using Le Roux as an informant. He’d been arrested the year before. They did another bust of these guys who were selling meth out of North Korea. There were some signs that those two cases were connected, but it wasn't clear how.


It wasn't until 2014 that someone leaked Le Roux's name to the New York Times. I’d been following it a little bit and reporting [some] and that's when it was clear to me that Le Roux was the person that connected all these cases together. That's when I started really getting into it, partly because Le Roux was this programmer and I've always written about technology. This intersection of technology and crime [connected to] Le Roux kind of pushed all those buttons for me. From that point onward, I was basically a full time Le Roux chaser.

How did you actually report on this given the dangerous network of criminals in play on one hand and the steps they took to at least attempt to avoid detection on the other?
If you look online deep enough, there's actually a lot of online history for Le Roux, because he wrote a piece of encryption software [that was] itself pretty well known in the early 2000s and then it [evolved into] a very well known encryption program. You could find his companies and his web registrations online. He’d been based in the Philippines and my first big breakthrough was going to the Philippines and finding people who had worked for him. He ordered a number of murders in the Philippines and agents who were trying to solve those crimes were unable to do so.

[The trail] kept expanding outwards. I went to Israel. I went to Hong Kong. All these places where his empire had touched down. There were always people, sometimes dozens, sometimes hundreds of people who’d worked for him, because his organization was so large, including in the United States. There were doctors and pharmacists who’d worked for the network and they'd never even heard of Le Roux. I started trying to trace down every part, every little tentacle of his empire, and find someone who’d been at the center of it and get their story.


As you were researching and writing the book and going through this whole process, what surprised you the most about him? What sticks out about this character in your mind now?
He was a brilliant guy in many ways. The way he built his online network, where he made hundreds of millions selling pharmaceuticals, was actually all done out in the open. You hear about the dark web and people using cryptocurrency to buy drugs online and it sounds like something that someone needs special expertise to go in and do. The network that he created was actually fully in the open. You could just Google a painkiller and go to a website and buy it. A real doctor would write you a prescription and a real pharmacist would ship it to you. It was all in this legal gray area.
The way he did it was so clever that it was kind of like, it wasn't even in the shadows. It was just right there for them to find.

We still don't fully understand the size and scope of his operation, though, right?
In terms of size, they've had trouble estimating it, because I don't think he's been particularly forthcoming about how much money he made. He claims that he made $300 million over the course of his criminal career, which was 2004 to 2012. It's not even clear from his statements whether that's supposed to be profit or revenue, but in any case, there are US government estimates that he made as much as $200 to $250 million in one year, in terms of revenues, selling pharmaceuticals online.


The way it worked was he’d recruit a pharmacist in Oshkosh, Wisconsin. This is a small pharmacist who owns his own place and he's trying to compete against CVS and these big drug stores. He’s losing money, so he gets an unsolicited recruitment saying, “Hey, You can make a couple dollars a prescription filling these online prescriptions for us and we're a legitimate company." So he signs up and then a doctor in Pennsylvania goes on a message board and it's like, "Work from home. You can prescribe drugs for $2 or $3 a prescription and make money on the side." [The doctor] signs up.

He was operating from the Philippines, but everything inside the network, the actual shipment of the drug, was all happening with legitimate organizations, doctors, and pharmacists in the United States. He was out of reach of American authorities and was manipulating the system here to make hundreds of millions of dollars. At its height, in 2008 and 2009, he started making his transition to other types of global crime. He basically built his own cartel where he was doing arms and drug dealing on a large scale. He was laundering money across Africa and Hong Kong. That's when violence started seeping into the organization.

"He almost never went anywhere himself to conduct these transactions."

How do you explain his remaining a ghost for so long, though? What made him uniquely able to evade detection? His tech wasn't that sophisticated, was it?
At the very beginning, he would put his name on stuff. But then as time went on, he started creating more layers between him and what was happening online. There were some incredibly brilliant technical things that he did. Websites that sell pharmaceuticals against the regulations of various countries often get shut down. Le Roux developed his own domain registrar, which meant that if a website got shut down, he could just generate another domain address on his own. He didn't have to go buy it from GoDaddy or Network Solutions. He could just generate them by the thousands. It took the authorities a while to realize that the organization was just him.


[Authorities] would send letters saying, "Hey, could you please shut this guy down? He's doing something illegal." It would get ignored because Le Roux was able to create these various layers and he became more invisible over time. He’d written his own encryption software and owned his own encrypted email server. [Law enforcement] could get a subpoena or search warrant to search email, but they couldn't get inside his server. There were all these technical ways that he was able to insulate himself. He bought people from top to bottom in the Philippines and knew when US agents came into the country.

He was basically doing all this kind of stuff from his laptop, rather than in the field, so to speak, right?
He owned all these properties in Manila. Sometimes he'd be on a yacht with his laptop. He had an old beat up Microsoft laptop that he’d outfitted with his own encryption and he’d just sit at home and [steer] all of these various arms of his operation. He worked most of the day and almost never slept. [If] he wanted to get into the cocaine trade, he’d find one of his employees who knew somebody and he’d send them to Peru. If they called and said, "It looks like we've got a deal,” Le Roux [would] wire a million dollars to show that he was for real and then the deal was on. He almost never went anywhere himself to conduct these transactions. He only did it if he absolutely had to.


We know he eventually got busted in what appeared to be a meth deal in Liberia. How do you explain his downfall and his willingness to flip, though, and what's his endgame really look like, given that his own case is still playing out?
Le Roux was finally arrested [when] they lured him to Liberia for a big deal. It was a sting operation, but they claimed that there was a deal with a Colombian drug cartel. He was arrested there with the help of an informant who’d worked for him and went back to work for him on behalf of the DEA. At first he tried to bribe his way out of it, but he flipped on the plane back from Liberia to the United States. He [told them], "I'll cooperate. I don't want to spend the rest of my life in prison. What do you want to know?"

They brought him to Manhattan initially, and formalized an agreement with his appointed lawyer that day. His cooperation basically amounted to helping them capture first some of the mercenary guys who had worked for him, namely Joseph Hunter and another guy named Tim Vamvakias. They also recruited new guys into their hit team, with Le Roux promising them new deals and new targets. Two Germans and a Pole, ex-military-types, were recruited by Joseph Hunter after Le Roux was arrested. They also got caught up in the sting operation.

He [also set up] five characters that were connected to the North Korean meth operation, including the middle man to the Triads. There was a lot of promise when he first flipped that he would help them get inside Korea, to get to the heart of where this meth was coming from and that he would help them get into Iran, because he’d been conducting weapons deals with Iran. He had a weapons deal on the table with Iran when he was arrested. Ultimately, my sources have indicated to me that neither of those approaches ever worked out. In other words, they didn't really get much from him when it came to North Korea and Iran.

So, did the feds screw up here in letting him cop a plea on drug charges and not the more violent stuff?
The question is, what was his cooperation worth it? He pleaded to the meth charge and a few other charges, bribing a government official, engaging in arms sale to Iran, which is a crime in the United States. But he was able to tell them about the murders [he ordered] under the cooperation agreement without being specifically charged with those murders, along with a host of other crimes that he could talk freely about. He helped them catch people that worked below him.

There's a date for sentencing set in March. I'm not sure it's going to hold, but he will probably be sentenced sometime in the first half of this year it looks like. It's a big question what he might get. He could get anything from ten to life. He's served almost seven now. He could get ten and be out [soon.] They could go below the guidelines and give him time served for his cooperation. He could also get 20 or 30 years, if the judge really takes into account his violent past, even if he's not specifically charged with those murders.

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This interview has been lightly edited and condensed for clarity. Learn more about Ratliff's book here.

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