Forensic Update

Reflections on information management within the legal and regulatory arena

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on August 19, 2022

Today’s #GoodGuysPrevail Update: The U.S. Department of Justice has secured a guilty plea from an Atlanta-based film producer for his involvement in a $2.5M USD #cryptocurrency#scam. The defendant pleaded guilty to #moneylaundering#securitiesfraud, and #wirefraud charges in connection with his 2017 fraudulent #ICOs.

While this was a fairly mundane scheme (at least in the context of 2017 ICOs, that is), it involved misrepresentations including claims that a prominent rapper was involved in the venture (ostensibly an entertainment streaming platform). The central scam alleged that user adoption would “surpass Netflix” over time.

As it turns out, the defendant merely converted the #ICO proceeds into his personal accounts, purchased a $1.5M USD house, a Ferrari for nearly $200k, and other lavish expenditures. As if this behavior wasn’t toxic enough, the defendant then went on to raise an additional $200k USD via a second ICO scam (ostensibly a cryptocurrency trading exchange), where he also pocketed the proceeds related to that venture.

While this case took nearly five years to reach this point, it’s a testament to the long-term focus of #lawenforcement that fraud is fraud. #Kudos to the Federal Bureau of Investigation (FBI) which investigated these ICO scams, the U.S. Securities and Exchange Commission which contributed to the case, and the United States Attorneys’​ Offices that prosecuted the case.

#justice #ruleoflaw #AisA #fraud #cyberfraud #cryptofraud #digitalforensics #digitalassettracing #digitalassetrecovery #karma #investorscams #fraudulentinducement

Posted in Computer Forensics, cryptocurrency, CyberSecurity, Forensic Accounting, Fraud, Investigations | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on August 14, 2022

The U.S. Department of Justice recently extradited the alleged operator of illegal cryptocurrency exchange #BTCe. This extradition is the culmination of over 5 years of litigation, and the 2017 indictment states that the BTC-e exchange ostensibly laundered over $4 billion (USD) in criminal proceeds.

Like other exchanges that have been sanctioned and/or shut down in recent years, BTC-e enabled users to anonymously trade bitcoin, allowing them to cash out proceeds from various #ransomware#identitytheft#drugtrafficking, and #taxrefund schemes. Defendant Alexander Vinnik, a Russian national, made his first appearance in federal court last week in San Francisco.

In addition to facing criminal charges, Vinnik also faces Dept of the Treasury/Financial Crimes Enforcement Network civil money penalties for: failing to have an #AML process or program; failing to register as a money services business with the U.S. Department of the Treasury, and failing to have a system for appropriate #KYC verification. The 2017 #FinCEN civil money penalty assessment was for $88.6M USD for BTC-e and $12M USD for Vinnik personally.

This extradition marks another milestone for the DoJ’s ongoing efforts to collaborate with international #lawenforcement and to disrupt organized #cybercrime#Kudos to both American and Greek law enforcement for a remarkable coup in bringing this saga to its final chapter. Plaudits also belong to the Federal Bureau of Investigation (FBI), the IRS Criminal Investigation division, U.S. Department of Homeland Security, and the U.S. Secret Service for their roles.

#AisA #ruleoflaw #justice #digitalforensics #forensicinvestigation #cryptocrime #digitalassets #fraudinvestigations #cryptoassets #digitalassettracing #digitalassetrecovery #forensicaccounting #karma #cryptocurrency

Posted in Computer Forensics, cryptocurrency, CyberSecurity, Data Breach, Digital Assets, Forensic Accounting, Fraud, Information Security, Investigations, Privacy, ransomware | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on August 8, 2022

The U.S. Department of Justice recently charged six defendants in four separate crypto-related fraud cases:

  • the largest known #NFT scheme charged to date;
  • a global #Ponzi scheme involving unregistered securities;
  • a fraudulent #ICO; and
  • a fraudulent investment fund.

Like prior #GGP updates, these cases reflect the herculean efforts of coordinated #lawenforcement and #digitalforensic efforts. Kudos to the Federal Bureau of Investigation (FBI), the United States Attorneys’​ Offices, the Department of Homeland Security, Office of Inspector General.

If you believe that you are a victim of the Baller Ape Club, EmpiresX, TBIS, and Circle Society schemes, please visit the DOJ website for details on how to submit your “Victim Impact Statement” (and thereby register as a victim).

#ruleoflaw #fraudinvestigations #cybercrime #cryptoassets #digitalassettracing #digitalassetrecovery #forensicinvestigation #forensicaccounting #karma #AisA #digitalassets

Posted in Computer Forensics, cryptocurrency, Digital Assets, eDiscovery, Forensic Accounting, Information Security, Investigations, Privacy | Tagged: | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on August 4, 2022

The U.S. Department of Justice seized assets worth $500k USD from North Korean hackers targeting U.S.-based #healthcare organizations. The seized North Korean assets were either monies directly extorted from companies or monies used in laundering #ransomware payments.

In addition to the general #karma of this action, there was an object lesson about public-private sector collaborations as well. The prompt reporting by one healthcare victim allowed the Federal Bureau of Investigation (FBI) to identify a new strand of North Korean ransomware.

Of course, $500k is a pittance compared against the hundreds of millions of dollars stolen by North Korean cyber actors in recent years. Just the same, it’s important to trumpet the “wins” wherever we can find them.

justice #cyberfraud #statesponsored #northkorea #digitalforensics #lawenforcement #ruleoflaw #forensicinvestigation #cyber

Posted in Computer Forensics, cryptocurrency, CyberSecurity, Data Breach, Fraud, Information Security, Privacy, ransomware | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on July 27, 2022

Earlier this week, the United States Attorneys’​ Offices won a conviction against the fraudster behind the crypto scheme My Big Coin – the regrettably named defendant for a cryptocurrency shill: Randall Crater. As a refresher, this was a $6M USD scheme defrauding investors by marketing and selling non-existent virtual currency.

As with several prominent mentions in the press this week, including actions from both U.S. Securities and Exchange Commission and U.S. Department of Justice, the “fraud is fraud” theme was the central theory of this case. For those of us in the digital assets industry for some time now, this is just the latest example of things equalizing in this space (i.e., the grown-ups are now on scene).

Kudos to the Federal Bureau of Investigation (FBI), the USPS OIG, the U.S. Commodity Futures Trading Commission for its combined efforts in achieving this conviction.

#cryptocurrency #fraudinvestigations #digitalforensics #digitalassets #fraud #conviction #currency #scam #cryptofraud #lawenforcement #assettracing #assetrecovery #forensicinvestigation

Posted in Computer Forensics, cryptocurrency, CyberSecurity, Digital Assets, Fraud, Investigations, Privacy | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on June 8, 2022

The U.S. Department of Justice announced yesterday that it has shut down (i.e., seized and taken control of the domains governing) several websites serving as both #DDoS attacks and as indexed search engines for breached personal information.

In the Federal Bureau of Investigation (FBI) announcement, the WeLeakInfo[.]to website was specifically referenced. For those who are unaware, this site contained roughly 7 billion indexed records of personal information illegally obtained from over 10,000 #databreaches. This is a 𝐁𝐈𝐆 𝐃𝐄𝐀𝐋.

Kudos to all involved: The Federal Bureau of Investigation (FBI), the U.S. Department of Justice, the National Police Corps of the Netherlands, and the Federal Police of Belgium.

justice #karma #ruleoflaw #digitalforensics #forensicinvestigation #lawenforcement #cybercrime #databreach #cyberforensics #police

Posted in eDiscovery | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on May 17, 2022

I know that there are many events unfolding in recent weeks with far more gravitas than the link below might indicate. That said, I share today’s update because it’s a testament to the depths that the second-handers of the world will sink to meddle in something designed to be life-affirming — and the importance of resisting such meddling.

For those who don’t know, #EuroVision is an international songwriting competition organized annually by the European Broadcasting Union, featuring participants primarily from European countries. Italian police foiled a series of cyberattacks by a pro-Russian hacking group called “Killnet”. The Killnet attacks were designed to skew the results of this year’s competition, but both the #DDoS and voting-manipulation attacks were unsuccessful.

In case you haven’t heard, the #EuroVision2022 winner was Ukraine.

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#AisA #ruleoflaw #digitalforensics #lawenforcement #justice #karma #cybercrime #forensicinvestigation #databreach

Posted in eDiscovery | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on April 13, 2022

While the use of the verb “forfeit” in the headline of this story may seem confusing, it’s a GREAT turn of events. Simply put, U.S. Department of Justice, Criminal Division prosecutors in the Southern District of Florida have secured one of the largest #cryptocurrency #forfeiture actions ever filed in this country.

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This story really resonates with me, as it represents a rather elegant intersection of #cyber and #crypto. The forfeiture action netted about $34M in cryptocurrency, all tied to the illegal #darkweb activity of a South Florida resident — specifically, the sale of online account credentials.

Of additional interest is the method by which this case was brought. In yet another example of inter-agency collaboration among federal, state, and local #lawenforcement, the investigators “followed the money” through a tortuous path, owing to the target’s use of cryptocurrency “tumblers”, “chain hopping”, and other (failed) #moneylaundering techniques.

Kudos to the Internal Revenue Service‘s Criminal Investigation group, the Federal Bureau of Investigation (FBI), the U.S. Department of Homeland Security, the United States Postal Service Inspection Service, and the Drug Enforcement Administration for its combined investigative efforts here.

#ruleoflaw #digitalforensics #digitalassets #assettracing #assetrecovery #forensicinvestigation #justice #karma #AisA

Posted in Computer Forensics, CyberSecurity, Data Breach, eDiscovery, Forensic Accounting, Fraud, Information Security, Investigations | Comments Off on Today’s #GoodGuysPrevail Update…

Today’s #GoodGuysPrevail Update…

Posted by Johnny Lee on March 17, 2022

A mere 8 months after his (alleged) involvement in the Kaseya #ransomware attacks, a Ukrainian national has been extradited to the United States and been formally indicted in a Dallas courtroom. This is the way…

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#ruleoflaw #justice #revil #cybercrime #fraud #extortion #lawenforcement #cyberfraud #digitalforensics #dfir #incidentresponse #cybersecurity #crimedoesntpay

Posted in Computer Forensics, CyberSecurity, Data Breach, Information Security, Investigations, Privacy | Comments Off on Today’s #GoodGuysPrevail Update…

A #ForensicUpdate with Insurance Broker McGriff…

Posted by Johnny Lee on February 9, 2022

I was thrilled to join my colleague, Lisa Frist, on a recent podcast discussing #cyberforensics and #lessonslearned from #cyberinvestigations. It’s (mercifully) brief, so please give it a listen.

#databreach #espionage #digitalforensics #investigations #cyberinsurance #cybersecurity #cyberrisk #riskmanagement

Posted in eDiscovery | Comments Off on A #ForensicUpdate with Insurance Broker McGriff…

 
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