Feds Seize $5.2 Million in Bitcoin From Accused Crypto Thief

A federal judge last week ordered a young hacker who allegedly stole cryptocurrency from Northern California crypto executives to hand over nearly $5.2 million in Bitcoin and a sports car to the US government.

Ahmad Wagaafe Hared was a teenager living in Tucson, Arizona, in 2016 when prosecutors say he began working with two accomplices to steal cryptocurrency. Hared allegedly targeted victims in Northern California, which is why his case is taking place in federal court in San Francisco.

While it is unclear which company executives Hared targeted in Northern California, the Bay Area has long been a hub for cryptocurrency startups. Hundreds of cryptocurrency organizations have called the region home. according to Crunchbaseincluding crypto exchange Coinbase, which was based in San Francisco for years and is now space rental in Mountain View.

Hared and his accomplices first obtained the personal contact information of cryptocurrency executives and investors, prosecutors say. They then allegedly contacted mobile phone service providers and manipulated company representatives into believing they were the rightful owners of the phone numbers they targeted. Hared's team would supposedly transfer the target phone number to their own phone; This is known as SIM swapping.

Taking control of his victims' phone numbers allowed Hared and his accomplices to access email and other accounts, prosecutors said in a 2019 indictment. Ultimately, Hared and members of his team used their access to these accounts to break into their victims' cryptocurrency deposits and empty them.

The plan was apparently lucrative. Last Friday, a federal judge in San Francisco issued a preliminary forfeiture order granting the government permission to seize Hared's 119.8 Bitcoin, currently worth $5.2 million, according to Yahoo Finance. Hared also has to hand over 93,420 Stellar Coins, worth $11,770, and a 2017 BMW i8, which would likely fetch around $60,000 on the used car market, according to Kelly Blue Book.

Hared reached a plea deal in 2019, according to the order, but many of the documents in the case remain sealed and the agreement has not been made public. Hared was originally charged in January 2019 with a series of charges, including computer fraud, identity theft and extortion.

Neither Hared's attorney nor the U.S. Attorney's Office responded to requests for comment.

Prosecutors notified the Hared judge that Anthony Francis Faulk's criminal case was related, although court documents do not explain the connection.

Faulk pleaded guilty to conspiracy to commit wire fraud for participating in a SIM-swapping scheme targeting cryptocurrency executives that ran between October 2016 and May 2018, according to court documents from prosecutors in his case. Hared's activity also took place between October 2016 and May 2018, prosecutors said in their indictment of him.

Faulk's scheme bilked more than $3.4 million from 10 victims, prosecutors alleged. Faulk used the winnings to purchase a nearly $1 million home, several high-end cars including a Ferrari and a Mercedes, a Rolex and more. Prosecutors sought to seize nearly $19 million from Faulk, as well as five cars, according to a sentencing memorandum.

Last month, a federal judge in San Francisco ordered the government to seize some of Faulk's properties, including land in Pennsylvania, several bank accounts and gold jewelry. He was also sentenced to four years in prison in a related money laundering case and owes $2.8 million in restitution.

The order also gave the government ownership of Faulk's royalty rights to 20 different songs that he had apparently purchased. Titles included: "Back on the Grind", "Get Hyphy" and "Burglar Bars".

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