The FBI issued a warrant related to the scam investigation, and Forbes was the first to report on it. Trezor crypto wallets are more secure than wallets linked to exchanges and were used to keep these funds. The money was even more protected by being kept in a “secure facility.” One of the oldest techniques in the crypto fraudster playbook was used to defraud the same federal agency that helped shut down the largest crypto-based dark web drug marketplace Silk Road. After falling for a classic airdrop phishing scam, the U.S. Drug Enforcement Administration reportedly gave a fraudster a little over $55,000 in seized cryptocurrency.
The DEA attempted to send a test amount of Tether to a wallet owned by the US Marshals, but the scammer discovered because all transactions are visible on the blockchain. After then, the suspected con artist engaged in what is known as an airdrop fraud. In essence, the con artist used the first five and last four numbers of the Marshals’ account to generate a brand new address. A cryptocurrency wallet’s address is a unique string of roughly 30 characters. After that, the con artist “airdropped” some Tether into the DEA’s account, making it appear as though the funds originated from the marshal’s home.
The two accounts look similar enough to the untrained eye that they can be copied and pasted whole rather than typed out by the average individual. In most cases, fraudsters desire full access to the wallet’s balance via a website link, although Trezor nevertheless cautions its customers aggressively about airdrop scams. These scams typically target consumers who are investing in a newly released cryptocurrency; but, vigilant fraudsters who are monitoring cryptocurrency addresses may strike gold with a well-timed phishing attempt, as was the case here. The Department of Drug Enforcement (DEA) inadvertently wired money to the phony marshal’s address; by the time the two branches of the Department of Justice (DOJ) reconciled their records, the money had already been transferred out of the scammer’s account.
Carl Force, a former DEA agent, admitted in 2015 that he attempted to extort $50,000 from Ross Ulbricht, the founder of Silk Road, in exchange for information about the DEA’s investigation of the dark web marketplace. Unfortunately, Gizmodo’s attempts to contact the DEA were met with nothing. The FBI said they couldn’t say anything about the probe. Tether, a so-called stablecoin tied at a 1-to-1 ratio with the U.S. dollar, was used to fund the $55,000 transfer to the fake account. The article claims that in May, the federal government seized cryptocurrency from two Binance accounts used to launder money from the sale of illegal drugs.
Forbes reports that the FBI has concluded the alleged con artist moved the money to a new wallet after first converting it to ether and then bitcoin. Those two accounts were linked to Binance cryptocurrency wallets. The FBI is reportedly investigating two Gmail accounts that were used to create those wallets. According to Forbes, the wallet IDs associated with the alleged crooks have been swiftly transferring funds between other accounts. While the DEA does have a few blemishes in its crypto-investigating background, the agency has made other arrests in the past few months involving drugs and cryptocurrency.
