US and Dutch Authorities Take Down Crypto-Fueled Fake ID Marketplace

Dutch and American law enforcement have shuttered online fake ID marketplace VerifTools, which sold counterfeit documentation for as little as $9 in cryptocurrency.

According to a press release published Thursday, Dutch cybercrime police gained control of two physical data servers in Amsterdam, while also seizing control of 21 virtual servers.

They worked in collaboration with the FBI, which seized two domains used by the VerifTools marketplace, as well as a promotional blog.

Both the FBI and the Identity Fraud and Documents Centre of Expertise in the Netherlands had conducted investigations into VerifTools, with the FBI determining that the marketplace had generated around $6.4 million in revenues.

Similarly, Dutch authorities estimate that Veriftools had an annual turnover of roughly €1.3 million (about $1.5 million), making it one of the largest providers of fraudulent identity documents internationally. 

The marketplace reportedly worked by requiring users to upload a passport photo and enter false data, which the site’s operators then used to generate a false ID. FBI agents were able to order fake driving licenses for the state of New Mexico, paying for the counterfeit IDs using crypto—though specific coins were not identified.

Once delivered, fake IDs are often used to bypass KYC safeguards or commit fraud, with police in Wales encountering the VerifTools marketplace in the process of a fraud investigation.

The VerifTools URL now leads browsers to a splash page, which announces that the website has been seized by Dutch and American law enforcement agencies.

“The removal of this marketplace is a major step in protecting the public from fraud and identity theft crime,” said Philip Russell, Acting Special Agent in Charge of the FBI Albuquerque Division. “Together with our partners, we will continue to target and dismantle the platforms that criminals depend on, no matter where they operate.”

In their press release, Dutch police report that they will continue to investigate the data found on the seized servers, which it will use in an effort to locate VerifTools’ administrators.

According to experts, the production and distribution of fake IDs has not only become big business, but is growing rapidly.

“Pinning down exact figures is difficult given the illegal nature of the trade, but most estimates place the global fake ID market somewhere in the billions of dollars,” said Kartik Venkatesh, global head of innovation at identity technology firm GBG.

Venkatesh told Decrypt that today’s fake IDs are far more sophisticated than the “crude” knockoffs of past decades, using industrial-level machinery and micrometer-thick lamination.

“Many include holograms, polycarbonate layers, barcodes that scan correctly, and UV-reactive ink, making them nearly indistinguishable from genuine documents without specialist equipment,” he explained.

And what has driven this leap in quality is increased demand, which has provided the conditions for a “thriving” illegal market of tools and technologies, which also includes AI-generated IDs.

“Production is now slick and international, with websites resembling professional ecommerce stores,” he said. “Buyers upload details, pay in cryptocurrency, and receive fakes hidden inside everyday items.”

In fact, Venkatesh reports that some sellers even offer return policies, guarantees, and guidance on how to use the IDs convincingly.

From his vantage point, the solution to the growth in fake ID marketplaces is to invest in sophisticated ID verification systems, which are already helping some businesses and authorities detect counterfeits.

“By layering document analysis, facial biometrics, liveness detection and behavioral signals,” he said, “they can spot inconsistencies invisible to human inspection.”

He also suggests that digital IDs may have a role to play longer-term, since their cryptographic design makes them harder to forge, while they can be instantly verified with issuing authorities.

However, while they also allow for selective disclosure, Venkatesh warned that digital identities will attract their own forms of abuse. He noted “synthetic IDs stitched together from real and fake data and deepfake biometrics designed to trick liveness checks, to credential theft if someone’s phone or ID wallet is compromised.” 

Because of this, he argued that the future will reside in “balance” and layered checks. 

“Digital IDs can raise the bar for fraudsters,” he said, “but only when paired with multi-layered verification that can adapt to new attack vectors.”