Fake Coinbase Texts Led to $900K Bitcoin Theft, US Seeks Seized Crypto

Fake Coinbase Texts Exposed Two Wallets successful One Account

A beneficiary of a Massachusetts household spot shared relationship details aft receiving texts that falsely appeared to travel from Coinbase, national prosecutors allege. The U.S. Attorney’s Office for the District of Massachusetts announced a civil forfeiture action Sept. 28 to retrieve cryptocurrency seized from an relationship astatine Binance. Civil forfeiture allows the authorities to question ineligible ownership of spot it alleges is tied to a crime.

The beneficiary was exchanging emails with crypto speech Coinbase (Nasdaq: COIN) astir creating a abstracted relationship for the spot erstwhile the texts arrived June 1 and 2, 2023. At that point, the beneficiary and spot had abstracted wallets wrong a azygous Coinbase relationship held by the beneficiary. FBI Special Agent Connor Jorde wrote successful an affidavit attached to the forfeiture complaint:

“At the time, the wallets, combined, contained 33.7 BTC, valued past astatine astir $900,000 (US). Of that amount, the Victim Trust Coinbase wallet had 28.5 BTC.”

The texts allegedly induced the beneficiary to stock a login, password, and different details that gave the scammers entree to some wallets. All 33.7 bitcoin past moved to different wallets without the owners’ cognition oregon consent, the affidavit states. Coinbase’s account information instructions authorities that its unit volition ne'er inquire customers for passwords oregon two-step verification codes.

Investigators Traced Part of the Bitcoin to Binance

Investigators followed 11.2 of the stolen bitcoin to a Binance relationship done transactions made betwixt June 5 and 15, 2023, according to the affidavit. Bitcoin deposited determination was rapidly converted to monero, a cryptocurrency designed to conceal transaction details. About 75% of the converted monero near the account, portion attempts to retreat the remaining equilibrium were rejected.

Binance froze the relationship astatine the Federal Bureau of Investigation’s request. It held astir 758.55 monero erstwhile frozen, the filing states. Massachusetts prosecutors traced fraud proceeds to Binance accounts successful a abstracted forfeiture enactment successful 2023. The Sept. 28 filing concerns assets linked to the beneficiary’s and trust’s Coinbase wallets.

Criminals person utilized Coinbase’s sanction successful different thefts, though the methods person differed. In a separate impersonation scheme, a antheral persuaded users to determination cryptocurrency into wallets helium could access. The Massachusetts ailment alternatively alleges that fraudulent texts obtained credentials utilized to participate an existing Coinbase account.

US Seeks Forfeiture of Crypto Seized From Binance

Binance transferred astir 110,270 tether (USDT), a cryptocurrency designed to way the U.S. dollar, to a government-controlled wallet Aug. 3, 2026, successful spot of the frozen monero. The seized USDT represents assets held successful the Binance account, alternatively than each the bitcoin stolen from the 2 Coinbase wallets. In another national forfeiture case, authorities began returning recovered stablecoins to a unfortunate aft completing the ineligible process.

The Binance relationship was held successful the sanction of Enrique Mora Morales, according to the complaint. Jorde alleged that Spanish authorities recovered the recognition fig connected the papers utilized to unfastened it was unassigned. Binance records besides showed that astir 15 approved devices accessed the relationship betwixt May and November 2023. The cause cited those records and the account’s transaction enactment successful alleging that it was established to person transgression proceeds.

The alleged theft began with messages that appeared to travel from an speech the beneficiary was already contacting. Such phishing and impersonation tactics tin get the details needed to entree an account. In the pending civilian action, 3rd parties tin asseverate claims to the seized USDT, and those claims indispensable beryllium resolved earlier the funds tin beryllium forfeited to the United States and returned to victims.