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Three people were convicted of identity theft conspiracy that allegedly involved the hack of $400 million from FTX in November 2022 on the same day FTX filed for bankruptcy protection, the court said. Records show.
Robert Powell, the 26-year-old alleged ringleader of the SIM-card swapping group that siphoned crypto out of FTX’s virtual wallet, was ordered released on $10,000 bond after a detention hearing Friday in Chicago federal court. Was. Powell’s attorney, Gail Pisetzky, declined to comment.
The Illinois resident and the other two defendants, Carter Rohan, 24, and Emily Hernandez, 23, are charged with conspiracy to commit wire fraud and conspiracy to commit aggravated identity theft and access device fraud in a scheme that ran since March. from 2021 to last April, and included co-conspirators traveling to cellphone retail stores in more than 15 states.
All three were arrested in their respective states last week.
The indictment, unsealed in the U.S. District Court in Washington, D.C., says the trio shared the personal identifying information of more than 50 victims, created fake identification documents in the victims’ names, impersonated them, and then accessed their victims “through online, financial And reached out socially.” The media creates accounts for the purpose of stealing money and data.”
The indictment states that the scheme was based on deceiving phone companies into changing the Subscriber Identity Modules of cell phone customers to cellphones controlled by members of the conspiracy. This in turn allowed the conspirators to circumvent multifactor authentication protections on victims’ accounts, giving them access to the funds in those accounts.
Rohan, an Indianapolis resident, was ordered held without bail following his arrest. His detention hearing will be held later in Washington.
Hernandez, who lives in Fountain, Colorado, was released last week on $10,000 bond.
A spokeswoman for the U.S. attorney’s office in Washington, which is prosecuting the case, declined to comment.
The indictment does not identify FTX as the main victim of the conspiracy, but the details of the hack described in that charging document align with publicly known details about the theft from FTX, which was collapsing at the time of the attack.
A source familiar with the case confirmed that FTX was the victim mentioned in the indictment.
Former FTX chief Sam Bankman-Fried was convicted in November 2023 of conspiracy and wire fraud charges related to the theft of $10 billion or more from clients. He awaits sentencing in Manhattan federal court next month.
The new indictment related to the hack says that on November 11, 2022, the same day that FTX filed for bankruptcy protection, “Powell instructed his co-conspirators to SIM swap the cellular telephone account of an employee of the Victim Company.” Was instructed to.” -1,” or FTX.
Later that same day, an unidentified co-conspirator sent Hernandez a fraudulent identification document containing personally identifiable information about an FTX employee, “but with Hernandez’s photograph on it, which Hernandez had sent to a mobile phone service in Texas. Used to impersonate that person as a provider,” the indictment alleges.
The indictment says that after gaining access to an FTX employee’s AT&T account, the co-conspirators sent Powell authentication codes that were required to access the crypto company’s online accounts.
Later on November 11 and also the next day, “co-conspirators transferred more than $400 million in virtual currency [FTX’s] Walls of virtual currency in virtual currency wallets controlled by co-conspirators.
The indictment says that several weeks before the FTX hack, the scheme looted $293,000 in virtual currency from one victim, and a few days later, stole more than $1 million in crypto from another person.
A day after the FTX hack, conspirators stole approximately $590,000 in crypto from one person’s virtual wallet.
The arrests come three months after blockchain intelligence company Elliptic reported that 180,000 units of the cryptocurrency Ether were deactivated after they were stolen in the FTX hack, but were then converted to Bitcoin in late September. By that time Ether was worth $300 million.
Elliptic reported that the method of laundering the stolen crypto is in an effort to hide its origins and that an actor linked to Russia was behind the hack of FTX.
“Stolen assets can be traced through Chipmixer, significant sums of which were routed to funds of Russia-linked criminal groups, including ransomware gangs and darknet markets, before being sent to exchanges,” Elliptic said in a report in October. are added together.” “This points to collusion with some broker or other intermediary in Russia.”
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