Two individuals, a Singaporean residing in the United States and a US citizen, have been charged with conspiring to steal and launder more than $230 million in cryptocurrency.
The pair, identified as Malone Lam, 20, a Singaporean who split his time between Miami and Los Angeles, and Jeandiel Serrano, 21, of Los Angeles, were arrested by the FBI on Wednesday night.
Details of the cryptocurrency laundering scheme
According to a press release from the US Department of Justice, Lam and Serrano fraudulently obtained more than 4,100 bitcoins worth approximately $230 million from a Washington, DC-based victim during the theft.
Lam, known online by the nicknames “Anne Hathaway” and “$$$,” and Serrano, who uses the handles “VersaceGod” and “@SkidStar,” made their first court appearances Thursday.
They are accused of running a cryptocurrency theft and laundering operation that involved fraudulently accessing victims’ crypto accounts, allowing them to transfer funds under their control. The Ministry of Justice noted that this regime has been operating since August of this year.
The scheme orchestrated by Lam and Serrano involved advanced laundering techniques to conceal the origin of the stolen assets. According to the indictment, they used cryptocurrency exchanges and mixing services to process and conceal the movement of stolen Bitcoin.
The key method used in this operation was “shelling chains”, a technique where large sums of cryptocurrency are broken down into smaller transactions, making the funds harder to trace.
Additionally, virtual private networks (VPNs) and pass-through wallets have added anonymity to their activities, allowing them to avoid detection while laundering stolen funds.
How was the scam removed?
Blockchain investigator ZachXBT provided insight into how the fraud was carried out. In a post on the X social media platform, ZachXBT explained that the accused individuals used “sophisticated social engineering” tactics to trick their victims.
2/ Incident Summary: On August 19, 2024, threat actors targeted a single lender, Genesis:
1) Calling as Google support via fake number to compromise personal accounts
2) Calling after Gemini support claiming the account was hacked
3) Socially engineered sacrifice to… pic.twitter.com/gemvrdRLNm— ZachXBT (@zachxbt) September 19, 2024
The $230 million fraud case involved targeting creditors from the now-defunct Genesis trading firm. The group allegedly used a fake phone number posing as Google support to convince the victim to reset their two-factor authentication, ultimately bringing their cryptocurrency under the conspirators’ control.
According to the US DOJ, the stolen cryptocurrency was used to finance a lavish lifestyle, with the proceeds spent on luxury goods and experiences.
Law enforcement agencies said Lam and Serrano spent the laundered cryptocurrency on high-end travel, visits to exclusive nightclubs, luxury cars, expensive jewelry, designer handbags and rental properties in Miami and Los Angeles.
Their extravagant spending patterns, funded by stolen assets, eventually attracted the attention of the authorities.
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