It seemed like a perfectly believable story: two teenagers in Canada posed as members of the Coinbase support team and scammed an American out of $4.2 million. Bitcoin And Ethereum. Sam Bankman-Fried, 30, founder and CEO of the now-bankrupt FTX exchange, is accused of defrauding clients of billions of dollars. Why couldn’t the teenagers pull off a little heist?
After seeing an email containing a press release about the alleged arrest of the teenagers, a reporter from the Canadian Broadcast Company, one of Canada’s leading news outlets, led the history, according to a member of the Hamilton Police Department familiar with the matter. (However, it remains to be determined whether this email is the ultimate source of the story.) Police in Hamilton, a small town near the New York border, reportedly teamed up with the FBI and the US Secret Service Electronic Crimes Task Force. to identify the two 17-year-olds, who went by the names “Felon” and “Gaze”.
News of the arrest of the teenagers, who according to reports used part of their $4.2 million in stolen crypto to buy the coveted username @zombie on Instagram, then spread across crypto editionseven landing in Decrypt. However, the whole story – from the teens’ alleged burglary to their arrest – is a sham, according to the same Hamilton Police Department source.
The department is still investigating the origins of the hoax and said it plans to issue a statement debunking the story soon, the source said. Fortune. The FBI did not immediately respond to a request for comment.
“Coinbase has extensive security resources dedicated to educating customers about preventing phishing attacks and scams,” an exchange spokesperson said in a statement. “We are working with international law enforcement to ensure that anyone who defrauds Coinbase customers is prosecuted to the fullest extent of the law.”
While several publications were tricked into publishing a grim story of another crypto arrest, the theft as described would not have been the first of its kind.
In January 2018, in the village of Irvington, New York, 15-year-old Ellis Pinsky, nicknamed “Baby Al Capone”, allegedly flew nearly $24 million from crypto millionaire Michael Terpin. Pinsky agreed repay Terpin without admitting any guilt.
And the Hamilton Police Department himself investigated and arrested a teenager for stealing nearly $35 million in crypto via a SIM swapping attack, or when scammers transfer a victim’s phone number to their devices to bypass two-factor authentication .
The investigation and arrest, which took place in 2021, echoes the spoofed press release, including the Hamilton Police Department’s partnership with the FBI and the US Secret Service’s Electronic Crimes Task Force, as well as stolen crypto spent on a rare online username.
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