US DoJ Charges Group of Individuals Who Stole $2.5 Mln in Crypto Via SIM Swapping

The United States Department of Justice released a fifteen-count indictment on May 9 that charges a hacking group labeled “The Community” with SIM swapping in order to steal cryptocurrencies.

U.S. Attorney Matthew Schneider and his colleague from the U.S. Immigration and Customs Enforcement Angie Salazar announced the charges in the Eastern District of Michigan. Per Salazar, the investigation was led by Homeland Security Investigations on two continents.

According to the indictment, five Americans and an Irishman are charged with conspiracy to commit wire fraud, wire fraud and aggravated identity theft. Another three, who reportedly are the former employees of mobile phone providers, are charged in a criminal complaint with the wire fraud related to “The Community.”

As described in the document, the hacking group used SIM swapping — a type of identity theft attack that generally targets a weakness in two-factor authentication. The perpetrator usually gains control of a target's mobile phone by convincing or bribing the employee of the mobile provider to swap the phone number to a SIM card controlled by the hackers.

After successfully swapping the numbers of their victims, “The Community” managed to gain access to their various online accounts, including cryptocurrency exchange accounts and wallets. As a result of fraud, approximately $2.5 million worth of cryptocurrency was sent to wallets controlled by the hacking group. Attorney Schneider clarified that in this case, three mobile phone service provider employees purportedly helped swappers to steal money.

The charges of conspiracy to commit wire fraud and wire fraud carry a maximum penalty of 20 years in prison each. Meanwhile, a conviction of aggravated identity theft could add up to two years in prison for the defendants .

According to Irish news website The Journal, a 20-year-old man from Dublin was arrested in Ireland upon the request of the U.S. authorities and is currently awaiting extradition.

As Cointelegraph previously reported, in November 2018, a law enforcement group dedicated to fighting cybercrime released a report on SIM swapping, stating that it had become increasingly popular in California.

Meanwhile, in January, a 21-year old American was accused of stealing almost $24 million in crypto via SIM swapping. And in February, a New York resident was indicted in what constituted the jurisdiction’s first SIM-swapping prosecution.