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Crypto Crime Spree: 12 Charged in $263M Bitcoin Theft

Coin WorldFriday, May 16, 2025 12:56 am ET

1min read

The Department of Justice has charged 12 additional individuals for their involvement in a $263 million cryptocurrency crime spree. This operation, which began in October 2023, involved a group of individuals who initially met while playing online games and later evolved into a sophisticated cyber-enabled racketeering conspiracy. The group, primarily based in California and aged between 18 and 22, was responsible for a series of high-profile thefts, including the theft of 4,100 Bitcoin from a Genesis creditor in August 2024.

The group's activities included hacking databases, conducting social engineering attacks through cold calls to crypto holders, and even burglarizing homes to steal crypto hardware wallets. The stolen proceeds, totaling $263 million, were laundered using various methods such as virtual private networks, crypto mixer protocols, and exchanges using "peel chains." A peel chain is a money laundering tactic where cryptocurrency is transferred through a series of wallets, with small amounts of funds "peeled off" at each step to make tracing more difficult.

One of the most significant incidents involved Lam, the main defendant, who fraudulently obtained over 4,100 Bitcoin from a victim on August 18, 2024, resulting in over $230 million in losses. Lam was also accused of hacking into another victim's iCloud account to monitor their movements, while another defendant, Marlon Ferro, would break into their house to steal crypto hardware wallets.

The group has been charged with RICO (Racketeer Influenced and Corrupt Organizations) offenses, as well as wire fraud and money laundering. The Department of Justice noted that several defendants have been arrested, while two others are believed to be living in Dubai.

The stolen funds were used to finance a lavish lifestyle, including paying for nightclub services costing up to $500,000 on some nights, purchasing 28 exotic cars worth as much as $3.8 million, and acquiring luxury handbags, watches, and clothing. The group also rented homes and jets using fake identity documents to further their extravagant spending.

This case highlights the growing sophistication of cyber-enabled crimes and the need for enhanced security measures in the cryptocurrency industry. The Department of Justice's actions underscore the commitment to bringing those responsible for such crimes to justice and protecting the integrity of the financial system.

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