DOJ Charges Three in SIM-Swap Scam Linked to $400M FTX Hack

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Key Takeaways:

  • DOJ Charges Trio in SIM-Swap Scheme Potentially Linked to $400M FTX Crypto Heist
  • Federal authorities charge three individuals, dispelling initial suspicions of an inside job.

The United States Department of Justice (DOJ) has initiated legal proceedings against Robert Powell, Carter Rohn, and Emily Hernandez for their involvement in a SIM-swapping scam that unfolded in November 2022.

 The charges encompass fraud and identity theft, marking a significant step in combating cybercrime in the digital age.

These individuals stand accused of orchestrating a series of SIM-swap attacks, a sophisticated scheme aimed at fraudulently obtaining access to individuals’ online accounts by tricking mobile carriers into transferring their phone numbers to SIM cards controlled by the attackers. 

This nefarious tactic not only grants unauthorized access to personal information but also compromises two-factor authentication codes used for heightened login security.

According to the indictment, Powell, Rohn, and Hernandez obtained personal data from approximately 50 individuals, subsequently leveraging this information to manipulate service providers into transferring victims’ details to their own devices. Armed with access to authentication codes for financial accounts and cryptocurrency wallets, the trio executed unauthorized transactions and illicitly transferred over $400 million in digital assets.

Of notable concern is Hernandez’s use of a fake ID belonging to an FTX employee to impersonate them at AT&T, thus gaining access to their account and obtaining verification codes for accessing FTX‘s crypto wallets. 

Blockchain security firm Elliptic has highlighted the strong likelihood of FTX being the “Victim Company-1” mentioned in the indictment, citing multiple unauthorized transactions totalling around $400 million shortly after the exchange filed for bankruptcy in November 2022.

This development emerges amid a concerning rise in SIM-swap attacks targeting prominent entities within the cryptocurrency space. Threat actors exploit compromised accounts to launch phishing campaigns, exacerbating the vulnerability of digital assets and online security.

ZachXBT, a blockchain investigator, lamented the persistence of SIM-swapping and phishing incidents, emphasizing the ongoing threat posed to individuals and organizations alike, with millions of dollars at stake.

Furthermore, the recent sim-swap incident involving the U.S. Securities and Exchange Commission (SEC) underscores the pervasive nature of cyber threats, highlighting the imperative for robust security measures to safeguard against unauthorized access and fraudulent activities in the digital realm.

As the DOJ continues its pursuit of justice in this case, it underscores the critical need for vigilance and proactive measures to mitigate the risks associated with cybercrime, particularly within the burgeoning cryptocurrency ecosystem.

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Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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