Crypto catfishers ditch fake exchanges for approval phishing scams

December 14, 2023 Coin Telegraph

IRS lists 4 crypto crimes among its top cases in 2023

December 12, 2023 Coin Telegraph

The cases included investigations into the Silk Road marketplace, OneCoin, Oyster Protocol founder “Bruno Block,” and a money laundering scheme using Bitcoin kiosks.

The criminal investigation unit of the United States Internal Revenue Service (IRS) has listed four crypto-related cases among the top ten of its “most prominent and high-profile investigations” in 2023.

In a Dec. 11 notice, the IRS unit said there were four significant cases in 2023 involving the seizure of cryptocurrency, fraudulent practices, money laundering and other schemes. Coming in at its third most high-profile investigation in the past year was OneCoin co-founder Karl Sebastian Greenwood, who was sentenced to 20 years in prison in September for his role in marketing and selling a fraudulent crypto asset.

Other cases included Ian Freeman, a New Hampshire resident sentenced to 8 years in prison for operating a money laundering scheme using Bitcoin (BTC) kiosks and failing to pay taxes from 2016 to 2019. The government body was also behind an investigation of Oyster Protocol founder Amir Elmaani, also known as “Bruno Block,” for tax evasion related to minting and selling Pearl tokens.

Hong Kong regulator blocks access to two crypto entities, warning of fraud

December 6, 2023 Coin Telegraph

US senators drill into FTC’s work to track AI attacks on older citizens

December 6, 2023 Coin Telegraph

Coin Telegraph

The senators asked the FTC chair four questions about AI scam data collection practices to find out if the commission can identify AI-powered scams and address them accordingly.

Four United States senators have written to Federal Trade Commission (FTC) Chair Lina Khan requesting information on efforts taken by the FTC to track the use of artificial intelligence (AI) in scamming older Americans.

In the letter addressed to Khan, U.S.

Underlining the importance of understanding the extent of the threat in order to counter it, they stated:

“We ask that FTC share how it is working to gather data on the use of AI in scams and ensure it is accurately reflected in its Consumer Sentinel Network (Sentinel) database.”

Consumer Sentinel is the FTC’s investigative cyber tool used by federal, state or local law enforcement agencies, which includes reports about various scams.

The senators wanted to know if the FTC has the capacity to identify AI-powered scams and tag them accordingly in Sentinel.

The lawmakers also requested a breakdown of Sentinel’s data to identify the popularity and success rates of each type of scam.

Casey is also the chairman of the Senate Special Committee on Aging, which studies issues related to older Americans.

Australia tries again to combat ‘future sectors’ crypto scams

November 30, 2023 Coin Telegraph

Australia

The “Proposed Scams Code Framework” consultation paper aims to delegate clear roles and responsibilities to government and private entities when combatting scams.

A consultation paper on a new framework for addressing consumer and business scams proposed by Australia’s Department of the Treasury considers applying sector-specific codes and standards to banking and cryptocurrency scams, among others.

The paper adds to the efforts of the Australian Competition and Consumer Commission (ACCC) to combat scams via the annual Scams Awareness Week initiative. It also reveals Australia’s plan to assign mandatory industry codes to each different type of scam.

The “Proposed Scams Code Framework” consultation paper — announced on Nov. 30 by Assistant Treasurer Stephen Jones and the Minister for Communications Michelle Rowland — aims to delegate clear roles and responsibilities to government and private entities when combatting scams. “This includes ensuring that key sectors in the scams ecosystem have measures in place to prevent, detect, disrupt, and respond to scams, including sharing scam intelligence across and between sectors,” the Treasury clarified.

*Scams code framework proposed by the Australian Treasury. Source: treasury.gov.au*

The framework proposes three broad categories for assigning codes and standards, covering what they see as the areas most targeted by scammers: banks, telecommunications providers and digital communications platforms. It also mentions a “future sectors” category, which would tackle cryptocurrencies, nonfungible tokens (NFT) and related trading platforms and marketplaces.

The Treasury highlighted that Australian consumers and businesses lost at least $3.1 billion to scams in 2022 — an 80% increase from 2021. While the Australian government recently introduced several initiatives to address scams, existing attempts have proved ineffective.

The new mandatory industry codes will outline the responsibilities of the private sector concerning scam activity. Currently, the National Anti-Scam Centre (NASC), led by the ACCC, the Australian Securities and Investments Commission, the Australian Communications and Media Authority, and specialist support services are working together to combat scams in Australia.

The Treasury will collect comments on the consultation until Jan. 29, 2024.

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Hong Kong authorities say 145 victims and $18.9M lost in Hounax scam

November 28, 2023 Coin Telegraph

Hong Kong authorities say 145 victims and .9M lost in Hounax scam

Coin Telegraph

Authorities in Hong Kong confirmed there were 145 affected users scammed on the unlicensed crypto exchange Hounax, resulting in $18.9 million in lost funds.

Hong Kong authorities reported on Nov. 27 that 145 users were affected in a scam by the unlicensed cryptocurrency exchange Hounax, resulting in a loss of 148 million HKD ($18.9 million), according to local media Shenzhen Commercial News.

On Nov. 25, local police held an initial press conference to inform the Hounax platform of the reports. The Hong Kong Securities Regulatory Commission (SFC) said that as of the 27th, they received 18 complaints about exchange regarding amounts ranging from 12,000 HKD to 10 million HDK ($1,539- $1.2 million).

According to local police, Hounax claimed to be a licensed platform that cooperated in line with legal financial institutions, although on Nov. 1 the SFC listed it as a suspicious platform and cautioned users over its risks.

Hounax allegedly recruited local customers via claims it was founded by the original Coinbase technical team, it had a license from Canadian authorities, and it was considering investments from big names like Sequoia Capital and IDG Capital.

The chief inspector of the Commercial Crime Investigation Section of the Hong Kong Police, Ke Yongn, said the platform also utilized social media to attract victims. However, according to the report, the official Facebook page of the platform is no longer online.

The SFC currently lists nine suspicious crypto investment platforms, including Hounax, JPEX, Hong Kong Digital Research Institute, BitCuped, FUBT, futubit/futu-pro, EFSPD, OSL trading, and arrano.network.

This incident follows a major scandal with the JPEX exchange in Hong Kong earlier this year. Local authorities received more than 2,000 complaints from JPEX users and eventually reported around $180 million in losses. Sixty-six individuals have been arrested in relation to the scandal so far.

These events have caused local regulators in Hong Kong to tighten crypto regulation to avoid another industry catastrophe. However, regulators have said the country’s one-year grace period for crypto exchanges won’t change.

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Asked to get a banana, a BAYC owner narrowly avoids a fake Forbes scam

November 27, 2023 Coin Telegraph

BAYC

Scammers posing as Forbes journalists have been targeting BAYC holders to set up interviews and distract them while they attempt to steal their apes.

A Bored Ape Yacht Club (BAYC) owner says he has managed to avoid a potentially “dreadful day” after being asked to retrieve a banana for a photo from someone they initially believed was interviewing them for Forbes.

On Nov. 27, NFT collector ‘Crumz’ detailed his run-in with a scammer posing as a Forbes journalist.

He reported that someone pretending to be Robert LaFanco — a real Forbes editor, contacted him by direct message from an impersonator account with the offer of an interview for a new article about BAYCs.

SCAM ALERT!!
I just spent the last 2hours on Zoom with '@Forbes' it was pretty sophisticated and well thought out because I'm usually on high alert but luckily I wasn't caught. Here's what they did. 1/8
— Crumz (@crumz10) November 26, 2023

During the interview, the scammer prompted Crumz to click a "button" to allow access to record the interview. Crumz said he complied with the so-called journalists despite certain red flags, including their use of a non-premium Zoom account and wanting to use a separate recorder bot to record his screen.

“I had to press a button to allow access to record,” he said before adding, “I didn’t think much of it first but at the end, he asks me to say something that resembles my ape and he suggests a banana.”

'Crumz' said he later realized this was a distraction attempt to take him away from his computer during which the attacker would take control of his computer to steal his assets.

‘Crumz’ said instead of getting the banana, he waited by his computer and sure enough, the scammers started to control his screen.

"I mute my screen and there's no video and just waited by the screen and sure enough they started to control my screen, I stopped them when they went on delegate.cash."

8/8
Hopefully I'm safe now. Don't think they can still control my computer when I turn it back on.
Please be safe out there, it could've been a dreadful day today
— Crumz (@crumz10) November 26, 2023

Crypto casino Rollbit partner ‘@3orovik’ echoed the warning to his 140,000 X followers on Nov. 27.

He also fingered a spurious account named ‘Robert LaFranco’ whose profile claims he is a Forbes assistant managing editor. “During this interview, he attempts to trick you to gain access to your PC and steal your expensive NFTs,” he warned.

⚠️ WATCH OUT ⚠️

A fake Forbes journalist is reaching out to BAYC holders for a fake interview

During this interview he attempts to trick you to gain access to your PC and steal your expensive NFTs

It’s very unlikely Forbes would reach out pic.twitter.com/ViYrT0mk1l
— borovik.eth (@3orovik) November 27, 2023

Meanwhile, BAYC community member Laura Rod also reported being contacted by the bogus Forbes editor.

Earlier this month blockchain security firm Slowmist detailed a number of scams in which victims lost crypto assets to fake journalists.

It reported that, after scheduling an interview, the attacker would guide victims to join the interview on Telegram, providing an interview outline, conducting a two-hour interview, and then providing the malicious link to consent to publication.

In October, a Friend.tech user reported being duped by a fake Bloomberg journalist, who lured them into clicking a link for a “consent form” which instead resulted in a drained Friend.tech account.

Meanwhile, several industry observers have noted that scammers on X (Twitter) often have a BAYC profile picture which is something to look out for.

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Nansen phishing emails flood crypto investors’ inboxes

November 24, 2023 Coin Telegraph

Coin Telegraph

On Sept. 22, one of Nansen’s third-party vendors suffered a security breach, which exposed the email addresses of 7% of the system’s users.

Numerous users of the crypto analytics platform Nansen have received phishing emails from scammers pitching an “exclusive opportunity” to participate in the fictitious “Nansen Airdrop.”

On Nov. 23, crypto community members on X (formerly Twitter) flagged an ongoing phishing campaign targeting Nansen users. The scammers are impersonating Nansen and sending fake invitations to an exclusive airdrop event.

Cointelegraph confirmed the hack from crypto investigator Officer’s Notes (Officercia), who initially warned the community about the ongoing attack. He suspects that user data from a previous third-party database leak is being used to target Nansen users.

On Sept. 22, one of Nansen’s third-party vendors suffered a security breach, which affected nearly 7% of the system’s users. The users affected by the breach reportedly had their email addresses exposed, along with some password hashes, and several had their blockchain addresses compromised. At the time, Nansen claimed it would identify and inform those affected and ask them all to change their passwords. It also clarified that wallet funds were unaffected by the event.

*Nansen phishing email. Source: @offiercia (X)*

The screenshot of the Nansen phishing email shared with Cointelegraph shows the sender was “mail@networkforgood.com,” an email address completely unrelated to the original analytics platform.

It said that for the next 48 hours, users could claim a guaranteed allocated amount of fake NANSEN tokens. The scammers attached a link to the email, which would redirect users to a potentially rigged website.

Officercia advises reporting suspected phishing links to databases such as chainabuse.com, cryptoscamdb.org and phishtank.org, which help the internet community reduce the success rates of such attacks.

Nansen has not responded to Cointelegraph’s request for comment.

Even more crypto investors are potential phishing targets after user data from TrueCoin and FTX bankruptcy claims, among others, was leaked recently.

This is just someone scraping our public API that shows the association between public wallet addresses and public Twitter usernames.

It’s like saying someone hacked you by looking at your public Twitter feed.

Irresponsible reporting from @TheBlock_ and @vishal4c https://t.co/GIXOWazqBk
— friend.tech (@friendtech) August 21, 2023

However, Friend.tech recently denied claims that its database of over 100,000 users was leaked. “It’s like saying someone hacked you by looking at your public Twitter feed,” explained the Friend.tech team, clarifying that the information came from scraping its public API.

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Tether freezes $225M USDT linked to romance scammers amid DOJ investigation

November 20, 2023 Coin Telegraph

Tether freezes 5M USDT linked to romance scammers amid DOJ investigation

Coin Telegraph

The stablecoin issuer reported the illicit funds had been used by a Southeast Asia-based crime syndicate responsible for a “pig butchering” romance scam.

Stablecoin issuer Tether froze roughly $225 million worth of USDT tokens as part of an investigation into a Southeast Asia human trafficking syndicate launched by the United States Department of Justice (DOJ).

In a Nov. 20 announcement, Tether said it had worked with the DOJ and crypto exchange OKX to freeze $225 million USDT in “external self-custodied wallets.” The firm reported the illicit funds had been used by a crime syndicate responsible for a “pig butchering” romance scam — a technique in which bad actors attempt to develop an online relationship with unsuspecting individuals, often convincing them to invest in legitimate businesses before conning them.

According to Tether, the freezing of the USDT followed a “months-long investigative effort” into the location of the funds between the firm, OKX, DOJ, and U.S. law enforcement agencies. The stablecoin issuer said it would work with U.S. authorities to unfreeze any “lawful” wallets that may have been seized as part of the effort.

“Through proactive engagement with global law enforcement agencies and our commitment to transparency, Tether aims to set a new standard for safety within the crypto space,” said Tether CEO Paolo Ardoino. “Our recent collaboration with the Department of Justice underscores our dedication to fostering a secure environment. We believe in leveraging technology and relationships, such as our collaboration with OKX, to proactively address illicit activities and uphold the highest standards of integrity in the industry.”

Impressive work by @Tether_to and @okx teams, alongside with Law Enforcement to stop bad guys https://t.co/P0U8ydP91x
— Paolo Ardoino (@paoloardoino) November 20, 2023

Tether has previously worked with global law enforcement agencies to freeze assets allegedly linked to criminal syndicates, such as when the firm coordinated with Israel’s National Bureau for Counter Terror Financing to freeze roughly $873,000 worth of USDT used for funding terrorist activities in Israel and Ukraine. The latest $225-million freeze appeared to be the largest in Tether’s history.

Unlike many cryptocurrencies like Bitcoin (BTC), which has the ability to be held outside the control of anyone but the individual with the private keys, stablecoins like USDT are more likely to be issued by a single authority. As a result, the issuers sometimes have the capability of freezing funds and halting transactions in response to requests from law enforcement.

However, crypto moving through exchanges is sometimes subject to the same treatment. In August 2022, Binance said it had restricted account access to $1 million in crypto for a Tezos tool contributor following a request from authorities and similarly froze accounts linked to Hamas militants in October 2023 in response to Israeli law enforcement.

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