The defendant, whose activities were detailed in court documents, convinced victims they had been hacked and directed them to transfer their cryptocurrency to so-called "safe wallets," which were actually controlled by the scammer. The U.S. Attorney's Office has also ordered the forfeiture of cash, cryptocurrency and personal property with an estimated value of more than half a million dollars, along with restitution of nearly $16 million.
An investigation into the scheme revealed that the defendant laundered the stolen digital assets by swapping them across multiple crypto exchanges and consolidating them at "cash-out points." He then converted the funds into other cryptocurrencies and placed bets, before converting them into cash used to purchase gift cards or additional digital assets.
U.S. Attorney Gonzalez emphasized that "Coinbase and most other companies will never call customers or ask to transfer crypto to a 'safe wallet'." He warned consumers not to trust caller ID, sender names or lookalike domains that can be spoofed, and noted that scammers rely on urgency and pressure.
The case highlights ongoing risks facing cryptocurrency users, as phishing schemes remain a persistent threat in the digital asset space.