Two suspects have been arrested in connection with a massive $243 million cryptocurrency heist linked to a Genesis creditor, the U.S. Department of Justice announced on Thursday. The theft, which occurred on August 19, involved a sophisticated social engineering scam that targeted a victim of the now-defunct trading firm Genesis.
The victim was contacted by a spoofed number posing as a member of Google support, leading them to reset their Gemini two-factor authentication settings and send funds to a compromised wallet. The stolen $243 million was then split across multiple wallets and sent to more than 15 exchanges, according to blockchain sleuth ZachXBT.
Following an investigation, authorities identified Malone Lam, 20, a Singapore citizen residing in Miami and Los Angeles, and Jeandiel Serrano, 21, of Los Angeles, as the alleged perpetrators. Both suspects were arrested on Wednesday night and charged with conspiring to steal and launder the stolen cryptocurrency. They were scheduled to appear in federal courts in California and Florida on Thursday.
The stolen funds reportedly flowed into luxury goods brokers, where they were used to purchase high-end cars, watches, jewelry, and designer clothing. Investigators were able to freeze more than $9 million of the stolen funds, with $500,000 already returned to the victim. The culprits were identified after accidentally sharing an address used for luxury clothing purchases.
The Miami and Los Angeles police departments did not respond to requests for comment regarding the arrests.
Genesis Creditor Falls Victim to Social Engineering Scam
The $243 million heist targeted a creditor of Genesis, a defunct trading firm that has been embroiled in controversy since its closure. The victim was lured into the scam through a phone call from a spoofed number claiming to be from Google support. This tactic is known as social engineering, where attackers manipulate individuals into divulging sensitive information or performing actions that benefit the attackers.
In this case, the victim was convinced to reset their Gemini two-factor authentication settings, allowing the thieves to gain access to the compromised wallet where the funds were stored. The stolen cryptocurrency was then split across multiple wallets and transferred to various exchanges in an attempt to obscure its origins.
Arrests Made in Connection to the Heist
Malone Lam and Jeandiel Serrano were identified as the individuals responsible for the $243 million cryptocurrency heist. Lam, a Singapore citizen living in the United States, and Serrano, a resident of Los Angeles, were arrested and charged with conspiracy to steal and launder the stolen funds.
The suspects were apprehended on Wednesday night and were set to appear in separate federal courts in California and Florida on Thursday. Authorities were able to trace a portion of the stolen funds to luxury goods brokers, where they were used to purchase high-end items such as cars, watches, and designer clothing.
Investigation Leads to Recovery of Stolen Funds
Thanks to the efforts of investigators, including ZachXBT, more than $9 million of the stolen funds have been frozen, with $500,000 already returned to the victim. By analyzing transaction data and following the money trail, authorities were able to identify the suspects and prevent further dispersal of the stolen cryptocurrency.
The stolen funds were used to purchase luxury items, which inadvertently led to the culprits being identified. This swift action by law enforcement and blockchain experts highlights the importance of collaboration in combatting cryptocurrency-related crimes.
Overall, the arrests of Lam and Serrano represent a significant step towards justice for the victim of the $243 million cryptocurrency heist. The recovery of a portion of the stolen funds and the identification of the suspects demonstrate the effectiveness of investigative efforts in the cryptocurrency space.