Stake named in SIM scam
Crypto casino brand Stake.com has found itself in the spotlight after the US Attorney’s Office for the District of Columbia (USAO-DC) alleged that hackers laundered $5m in stolen bitcoin through its online casino.
bitcoin stolen through SIM-card-swapping
Last week, the USAO-DC announced that it was seeking, as a civil forfeiture, millions of bitcoin stolen through SIM-card-swapping attacks.
Cyber criminals behind the heist, according to the Department of Justice complaint, routed the plundered funds “into one wallet that funded an account at Stake.com, an online casino.”
The stolen bitcoin was then “cycled through bets and withdrawals to mimic legitimate activity.”
Weakness revealed
The crime scheme known as chip dumping washes illegal funds into seemingly clean cryptocurrency. While the DOJ didn’t accuse Stake of any wrongdoing, its vulnerability to money laundering might bring its customer checks outside scrutiny.
According to a leading business technology source, the USAO-DC action signals a wider crackdown on crimes that attack weaknesses in crypto and telecom security.
The source cited ongoing discussions by X users about the risks of digital gambling platforms and “how such platforms inadvertently facilitate illicit flows.”
According to US Attorney Jeanine Pirro, the heist occurred between October 2022 and March 2023 and exploited weaknesses in mobile carrier authentication to hijack the phone numbers of five targeted victims and gain access to their crypto accounts.
From an industry point of view, the meticulousness of the feds in chasing down the $5m money trail despite blockchain user anonymity may spur the likes of Stake to beef up their own digital security and avoid being used as a siphon for online money laundering.
Enter the CCIPS
According to an official press release, DOJ investigators and federal agencies, including the Computer Crime and Intellectual Property Section (CCIPS), made the case to seek the $5m through an analysis of blockchain transactions.
An offshoot of the DOJ’s Criminal Division, the CCIPS investigates and prosecutes cybercrime alongside US and overseas law enforcement, with its trial attorney Gaelin Bernstein prosecuting the Stake-related case.
The release states that since 2020, CCIPS has overseen the return of over $350m in victim funds and “secured the conviction of over 180 cybercriminals.”
