25 Year-Old Hacker Jailed For Stealing $20 Million in Crypto

A 25-year-old Florida man was sentenced to 18 months in prison for stealing over $20 million in cryptocurrency as part of a SIM swapping operation.

According to a news release from the US Department of Justice, the guy took part in a scheme in which a victim's SIM card was linked to another number. The “SIM switching” technique then allowed the hackers to gain unlawful access to the victim's crypto wallet, which was linked to a phone number controlled by the scheme participants.

In this example, the victim's crypto wallet contained more than $20 million in cryptocurrency.

After gaining access to the wallet, the now-sentenced Florida man was contacted by one of the scheme participants, who added him to an online call with several others. During the conversation, the Florida man learnt about the SIM swap scam and agreed to accept cryptocurrency from the victim's wallet.

The stolen cryptocurrency was subsequently exchanged into bitcoin (BTC) and distributed among scheme participants. A total of $20 million in cryptocurrency was stolen from the victim.

18 months in jail

Nicholas Truglia of Florida was sentenced to prison. U.S. District Judge Alvin K. Hellerstein handed down the punishment.

Truglia was sentenced to 18 months in prison and ordered to pay $20,379,007 in reparations to the victim within 60 days.

“Through a complicated SIM swap scam, Nicholas Truglia and his pals took a startling sum of cryptocurrencies from the victim.” Nonetheless, today's sentencing demonstrates that “this Office will continue to successfully prosecute individuals who choose to deceive others, regardless of how complex the crime is,”

U.S. Attorney Damian Williams said in a statement.

Crypto scams on the rise on YouTube

The sentencing comes as a new analysis from blockchain security firm Certik indicated that frauds on YouTube, notably schemes advertising so-called front-running bots, had increased by 500% in 2022.

Front-running is the process of trading on a decentralized exchange (DEX) before the original transaction has been executed utilizing inside knowledge of an unconfirmed blockchain transaction.

This is possible on many blockchains by visiting the mempool to view pending transactions, which include unconfirmed transactions. The user or bot then conducts a higher transaction cost transaction to guarantee it is processed first, and is therefore able to benefit by subsequently flipping the position on the same DEX.

Visualization of how front-running with fictitious numbers works:

According to Certik, there is an increase in YouTube videos that purport to offer front-running bots but instead drive users to sites that swindle them. Certik advises customers to avoid falling for this trap by never running programs they do not completely understand.

“It merely takes one line of code to turn an apparently innocent contract into a malicious one,” the company warned, before adding:

“In this case, the golden rule of scamming applies: if it appears too good to be true, it probably is.”

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