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United States seize hundreds of cryptocurrency accounts associated with North Korean hackers

By Elizabeth Hearst

Authorities in the United States have seized 280 cryptocurrency accounts they believe are linked to North Korean hackers. The US Department of Justice believes the hackers stole more than a quarter of a billion dollars from global cryptocurrency companies, including those listed in the United States. 

The Justice Department filed a civil forfeiture complaint in which they suspect North Korean hackers stole millions of dollars worth of cryptocurrency and subsequently laundered it through Chinese over-the-counter cryptocurrency traders. 

“Today’s action publicly exposes the ongoing connections between North Korea’s cyber-hacking program and a Chinese cryptocurrency money laundering network,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. 

As reported by the Wall Street Journal, this filing is the first publicly announced case of a US-based currency company targeted by North Korea. Rabbitt added: “This case underscores the department’s ongoing commitment to counter the threat presented by North Korean cyber hackers by exposing their criminal networks and tracing and seizing their ill-gotten gains”. 

Assistant Attorney General John C. Demers warned that “although North Korea is unlikely to stop trying to pillage the international financial sector to fund a failed economic and political regime, actions like those today send a powerful message to the private sector and foreign governments regarding the benefits of working with us to counter this threat.”

The filing alleges that in July 2019, a North Korean hacker stole over $272,000 worth of cryptocurrencies and subsequently laundered the funds through a number of intermediary addresses. Similarly in September 2019, a US-based company was hacked. A North Korean scammer is alleged to have gained access to the company’s virtual currency wallets. He is accused of stealing nearly $2.5 Million and laundering it through over 100 cryptocurrency accounts. 

The filing follows an indictment and sanctioning of two Chinese nationals in March who are accused of assisting North Korean hackers to launder the illicit funds. They are alleged to have converted the funds through exchanges of bitcoin for prepaid Apple iTunes gift cards. 

In a joint statement released earlier this week, the FBI, Department of Homeland Security, the US Treasury Department and US Cyber Command all condemned the North Korean regime, and accused the government of draining ATMs and initiating fraudulent money transfers across the world. 

The statement details a spearphishing technique in which fraudulent emails are used to hack into individual’s computers and reveal passwords or other sensitive information. 

Following the filing, Special Agent Steven Cagen of the US Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Denver, said: “As North Korea becomes bolder and more desperate in their efforts to steal money using sophisticated money laundering techniques, HSI will continue to apply pressure by exposing their fraudulent transactions… We are committed to safeguarding the interest of the United States against the criminal elements in North Korea to protect the integrity of the cyber financial system.”

Special Agent in Charge Emmerson Buie Jr. of the FBI’s Chicago Field Office added: “Today’s complaint demonstrates that North Korean actors cannot hide their crimes within the anonymity of the internet. International cryptocurrency laundering schemes undermine the integrity of our financial systems at a global level, and we will use every tool in our arsenal to investigate and disrupt these crimes.” 

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