The teens impersonated Coinbase’s support team to defraud victims.
Two teenagers from Hamilton, Ontario, have been arrested for allegedly stealing more than $4 million worth of Bitcoin (BTC) and Ethereum (ETH) from a U.S. man through what authorities described as a “spear phishing attack.”
Hamilton police began investigating the boys in June 2023 in partnership with the FBI and the Secret Service Electronic Crimes Task Force, according to local reports.
Spear Phishing Attacks
Const. Krista-Lee Ernst of Hamilton police said the two 17-year-old boys used spear-phishing attacks to trick victims into giving them $4.2 million in cryptocurrency.
Spear phishing attacks are a form of targeted phishing that scammers use to trick individuals into revealing sensitive information such as passwords, credit card numbers or other personal data. Unlike traditional phishing attacks that cast a wide net, spear phishing attacks are highly personalized and tailored to specific individuals or organizations.
In a spear phishing attack, the bad actor conducts thorough research to gather information about the target, such as their name, job title, company, colleagues, and even personal details from social media platforms. With this information, the scammer can craft a compelling, customized email or message that appears to come from a trusted source, such as a colleague, supervisor, or reputable organization associated with the target.
In the case of the Hamilton teen, the duo, known by the fake aliases “Felon” and “Gaze,” pretended to be members of the support team of Coinbase, a popular cryptocurrency exchange in the U.S. Their aim was to take over the man’s cryptocurrency account on the exchange.
More than $13 million seized
After successfully taking control of the account, the boys were able to access the man’s digital assets stored on the platform.
The teens spent some of the money on the Instagram username "@zombie," a rare username in the gaming community, according to police, who also seized at least $13.4 million worth of digital assets after their arrests.
Although authorities initially arrested two teens, only one was charged with theft over $5,000 and possession of property or proceeds obtained by criminal means, while the other was released.