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Two Russians who stole $16M cryptocurrency via phishing charged by the DOJ

The U.S. Department of Justice has filed charges against two Russian nationals who stole $16.8 million of cryptocurrency by phishing.

Image by Ricardo Goncalves from Pixabay

Thu, 17 Sep 2020, 14:25 pm UTC

Two Russians are facing charges for stealing $16.8 million in cryptocurrency via phishing. The hackers were able to pull off their multi-year operations by creating fake websites of three crypto exchanges.

On Wednesday, September 16, 2020, the U.S. Department of Justice filed charges against two Russian nationals for phishing, according to ZDNet. The duo was able to steal 16.8 million from their operation, which started sometime in June 2017.

The Russian duo, identified as Danil Potekhin and Dmitrii Karasavidi, made fake websites for Binance, Gemini, and Poloniex cryptocurrency exchanges. They then collected the account credentials of the users who were lured into the clone sites.

Potekhin and Karasavidi then used the stolen login credentials obtained from the fake websites to access the accounts of the victims.

Court documents reveal that the phishing operation was able to victimize 142 Binance users, 42 users at Gemini, and 313 Poloniex users. The suspects stole Bitcoin (BTC) and Ether (ETH) from the compromised accounts. The total value of stolen cryptocurrencies stolen is estimated to be at $16,876,000.

The Russian nationals set up intermediary accounts at different crypto exchanges to transfer the stolen funds. Using fake identities, they opened accounts with Binance, Bittrex, Gemini and Poloniex. . T

The DOJ also accused the duo of engaging in market manipulation. “Using digital currency in one victim Poloniex account, they placed an order to purchase approximately 8,000 GAS, thereby immediately increasing the market price of GAS from approximately $18 to $2,400,” the indictment noted, according to KrebsonSecurity.com.

The suspects then exchanged the inflated GAS tokens into other cryptocurrencies such as Bitcoin and Ether. “The defendants and their co-conspirators then quickly converted the digital currency in their fictitious accounts from GAS to Bitcoin and other digital currencies, causing the value of GAS to plummet,” the complaint said.

“Before the Eight Fictitious Poloniex Accounts were frozen, POTEKHIN and others transferred approximately 759 ETH to nine digital currency addresses,” the DOJ said in the complaint. “Through a sophisticated and layered manner, the ETH from these nine digital currency addresses was sent through multiple intermediary accounts, before ultimately being deposited into a Bitfinex account controlled by Karasavidi.”

David Anderson, US Attorney for the Northern District of California, said that the Russians could be facing up to 59 years of jail time. However, the two remain at large.

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  • Robert
  • 2020.09.18 23:10:10
I know about stolen Bitcoins a little too much and this is because I have been tricked into investing in a Bitcoin company that turned out to be a scam, so I had my bitcoins stolen.

The digital and virtual nature of the cryptocurrency makes it hard to trace hence it is a nightmare when you get swindled of your coins. Losing my 9 BTC to fraudsters last year was agonizing and tortuous as I did not know where to turn. I gave up hope, beat myself up for being dumb but about the evil nature of the criminal fraudsters. I was licking my figurative wounds with a lot of “what ifs”, wishing to turn back the hands of time when I stumbled upon ASSETRESCUE01 @GMAILCOM

To be fair, I did not take them seriously at first but I decided to give it a shot as I literally had nothing to lose at the point. Recovering lost cryptocurrency is near impossible but by reporting the situation to ASSETRESCUE01 @GMAILCOM , you give yourself a fighting chance at recovering what was lost. They have the technology to do the near impossible. You can simply send an email or WhatsApp on +1 206 745-0108
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