Six fraudsters, including five men and a woman, were arrested by the UK’s South West Regional Cyber Crime Unit (SW RCCU) for domain-spoofing a popular cryptocurrency exchange and defrauding at least 4,000 victims in 12 countries out of cryptocurrency valuing over 24 million euros.
The arrests took place in a joint operation involving the UK’s South West Regional Cyber Crime Unit (SW RCCU), the Dutch police, Europol, Eurojust and the UK’s National Crime Agency (NCA). The operation was initiated in February 2018 after British authorities established that the fraudsters behind the cryptocurrency theft were based in the Netherlands.
Fraudsters domain-spoofed a popular cryptocurrency exchange
"The investigation relates to typosquatting, where a well-known online cryptocurrency exchange was ‘spoofed’ – or recreated to imitate the genuine site - to gain access to victims’ Bitcoin wallets, stealing their funds and login details. The theft, which targeted users’ Bitcoin tokens, is believed to have affected at least 4 000 victims in 12 countries, with the numbers continuing to grow," said Europol in a press release.
"The investigation has grown from a single report of £17k worth of bitcoin stolen from a Wiltshire-based victim to a current estimate of more than four thousand victims in at least 12 countries. We expect that number to grow," said Detective Inspector Louise Boyce from the SW RCCU.
"As part of today’s operation, we’ve seized a large number of devices, equipment and valuable assets with huge support from our colleagues in Avon and Somerset Police, Wiltshire Police, Tarian and the South East ROCU. Devon and Cornwall and the Metropolitan Police also provided vital help in the form of their two cyber dogs, who played key roles in searching suspects’ homes," Boyce added.
According to SW RCCU, the six people accused of stealing more than £22 million worth of cryptocurrency were arrested at their homes in Charlcombe and Lower Weston in Bath, Staverton in Wiltshire, and Amsterdam and Rotterdam in the Netherlands.
Cryptocurrency exchanges becoming popular targets for hackers
Earlier this year, the UK’s South East Regional Organised Crime Unit (SEROCU) had also arrested a 36-year-old hacker from Oxford in a joint operation with the National Crime Agency (NCA), Europol, and the Hessen State Police in Germany for stealing 10 million in IOTA cryptocurrency from 85 victims since January last year.
The hacker, whose identity was not revealed, installed a malicious seed-generator in the official IOTA cryptocurrency website to defraud visitors to the website and used freshly-generated 81-digit seeds to gain access to the victims' wallets before transferring their money to other wallets created with fake IDs.
The theft of cryptocurrency from exchanges has been quite rampant in the recent past, with cryptocurrency exchanges around the world reported losses of tens of millions to fraudsters. In September last year, hackers stole about $60 million in cryptocurrency from Japanese cryptocurrency firm Tech Bureau Corp by taking advantage of "lack of proper safeguards for client assets and basic anti-money laundering measures".