Two Behind Bars For Allegedly Hacking Crypto Start-Up
Authorities are believed to be working to recover the lost assets.
Startup Loses $14 Million in Hack
Authorities are holding two men in connection to hack at a California based cryptocurrency startup. During the hack, the firm allegedly lost about $14 million in digital assets.
Media reports indicate the two men are Fletcher Robert Childers and Joseph Harris. The arrests occurred on Monday following the hack at Crowd Machine.
The two are also facing charges of stealing cryptos alongside identity theft. However, after the arrest, Childers was later freed after posting bail. On the other hand, Harris is currently in custody after failing to raise bond.
Court documents indicate that they took over Crowd Machine wallets leading to a loss of $14 million. The two who are from Missouri are believed to have used SIM swap to conduct the fraud. The attack is believed to have occurred on September 22.
Recently, SIM swap has become a new mode of hacking crypto investments. The fraud occurs through stealing a person’s number, the identity and later access accounts linked to the number through social engineering.
In a post by Crowd Machine, their wallets were tampered with leading to a loss of millions under the CMCT. The hack comes after one billion CMCT in reserves was raised through an ICO. The cryptos were stolen and then moved to trading platforms from where they were sold.
Crowd Machine further added that partner exchange platforms had been directed to seize trading the CMCT following an influx on unauthorized CMCT tokens. Potential investors have been advised not to buy any tokens until all systems are restored.
Crowd Machine boss Craig Sproule refused to issue more details about the attack. He acknowledged that a probe was ongoing while two suspects are already in custody. He said that the firm will cooperate with authorities until the probe is done.
Documents from the police further stated that the suspects were also involved in laundering the crypto assets via a number of trading platforms. The laundered assets have been traced within the US. At the same time, the suspects are said to have been sending emails to the hack victims.
Many experts are keen to see how the case will move forward despite the suspects being behind bars. At the moment, it is believed that authorities might be working to recover the lost cryptos.