As a seasoned crypto investor hailing from the bustling streets of Mumbai, I’ve witnessed the rapid growth and transformation of the digital currency landscape. However, stories like that of Chirag Tomar serve as stark reminders of the dark side of this promising world.
31-year-old Chirag Tomar, an Indian national, received a five-year sentence in a federal penitentiary due to his involvement in a large-scale scam related to cryptocurrencies. This scheme swindled over 20 million dollars from hundreds of victims.
U.S. District Judge Kenneth D. Bell handed down the sentence, which also included two years of supervised release.
Scammers Imitate Coinbase to Steal Millions
As a researcher, I’ve uncovered that we allegedly carried out our scheme by mimicking the genuine platform of Coinbase, a well-known cryptocurrency exchange, through a deceptive site known as “spoofing.” This spoofed site was used to manipulate market prices, which is a key aspect of the fraudulent activities.
Starting in June 2021, the group created a deceitful replica of the legitimate trading platform, Pro.Coinbase.com, using a false website address, CoinbasePro.com. Unsuspecting users who tried to access their Coinbase accounts were lured into disclosing their login details by this disguise.
One strategy employed was posing as Coinbase customer support agents and tricking victims into sharing their two-factor authentication (2FA) codes. Alternatively, scammers directed these people to download remote desktop software, thereby providing the scammers with complete access to their computer systems.
Tomar exploited fraudulently obtained documents to gain entry to numerous victim’s accounts and transfer money into accounts he managed. He subsequently switched the cryptocurrency into various digital assets, shifting them between different wallets to conceal the transactions. Over time, these funds were transformed into cash and dispersed among the criminal network.
In simpler terms, the 31-year-old spent the stolen cash on an extravagant lifestyle. This included buying expensive timepieces from brands like Audemars Piguet, luxurious cars such as Lamborghinis and Porsches, and visiting exotic locations such as Dubai and Thailand.
$240,000 Theft and Arrest
The plan affected individuals globally, even those residing in North Carolina’s Western District. In February 2022, a local resident tried to log into their Coinbase account via a phony website. This deceptive site immediately indicated that the account was locked and urged them to contact a number given to connect with an imposter Coinbase representative.
As a researcher, I found myself deceived by the individual claiming to represent a trusted entity. This false representative tricked me into disclosing my Two-Factor Authentication details, which unfortunately provided unauthorized access to my legitimate Coinbase account. Utilizing this information, cunning criminals managed to swipe approximately $240,000 worth of cryptocurrency from the attached wallet.
Previously, similar occurrences have taken place. Last year, law enforcement agencies accused Soufiance Oulahya of swindling $450,000 worth of cryptocurrencies and NFTs from a resident of Manhattan by manipulating the OpenSea platform.
After a spoofing attack led to the hijacking of its DNS, Convex Finance was forced to introduce two new URLs as substitutes. This incident, in which users unwittingly approved malicious contracts, underscores the need for caution. Upon confirming the hijack, Convex disclosed that five wallets had been compromised, but all verified contracts remained secure.
The danger extends beyond cryptocurrencies. In 2020, JP Morgan was penalized approximately $1 billion by U.S. authorities due to their spoofing activities in metals futures and Treasury securities. This penalty came after they were implicated in the FinCEN files for suspected money laundering of up to $2 trillion in alleged “dirty money”.
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2024-10-19 01:44