US federal agents have arrested and indicted two men for stealing $230 million in Bitcoin from a Washington resident, believed to be a creditor of Genesis.
Arrest and Charges
On September 19, the US Attorney’s Office for the District of Columbia reported that two young men, Malone Lam (20) and Jeandiel Serrano (21), were arrested and charged with conspiracy to steal and launder over 4,100 Bitcoin worth $230 million at the time from an unnamed victim in the country’s capital.
Fraud Methods
The pair used several online aliases and sophisticated methods to gain access to the victim’s accounts, transfer funds, and launder the proceeds since August 2023. Lam and Serrano reportedly spent their ill-gotten gains on a lavish lifestyle, including international travel, nightclubs, luxury vehicles, watches, jewelry, designer handbags, and rental homes in Los Angeles and Miami. Blockchain sleuth 'ZachXBT' assisted law enforcement in what he described as a 'highly sophisticated social engineering attack' in a post on X on September 19. He also identified a third suspect, known by the alias 'Wiz.'
Investigation Assistance
ZachXBT stated that the scammers targeted a single Genesis creditor on August 19. Genesis filed for bankruptcy in January 2023 following exposure to FTX and secured court approval to return $3 billion in cash and crypto to its creditors in May 2023. They called, posing as Google Support via a spoofed number to compromise the victim’s personal accounts. They then called, posing as Gemini support, claiming the account had been hacked, and convinced the victim to reset two-factor authentication (2FA) before sending Gemini funds to a compromised wallet. They also got the victim to run screen-sharing software from which they obtained their Bitcoin private keys. Initial tracing showed as much as $243 million in crypto was split multiple ways between each party before funds quickly dispersed to more than 15 exchanges, immediately swapping back and forth between Bitcoin, Litecoin, Ethereum, and Monero. A follow-up investigation found that a cluster of Ethereum addresses linked to Serrano and ‘Wiz’ received over $41 million from two exchanges in recent weeks. With the assistance of crypto forensic investigators, Web3 security firm zeroShadow, and the Binance Security Team, more than $9 million has been frozen, and $500,000 has already been returned after closely working with the victim to investigate the incident. The Columbia DA’s Office stated that the investigation is ongoing with assistance from the FBI’s Washington Field Office and the IRS-Criminal Investigation Washington Field Office.
Federal agents continue the investigation into the $230 million cryptocurrency theft, actively working with the victim and various experts to recover the stolen funds and bring the perpetrators to justice.
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