The Justice Department has initiated a civil forfeiture action seeking over $5 million in bitcoin believed to be proceeds from SIM swapping scams that targeted victims across the United States. The announcement was made by U.S. Attorney Jeanine Ferris Pirro.
According to the complaint, the funds are linked to unauthorized transfers of cryptocurrency from wallets belonging to five different victims. These thefts occurred between October 29, 2022, and March 21, 2023.
Acting Assistant Attorney General Matthew R. Galeotti of the Justice Department’s Criminal Division and FBI Special Agent in Charge Brett D. Skiles of the Miami Field Office joined in announcing the case.
The complaint details how perpetrators used SIM swapping tactics to gain control over victims’ phone numbers, allowing them access to authentication codes for cryptocurrency accounts. This enabled them to transfer funds into accounts they controlled.
A SIM swap attack involves exploiting vulnerabilities in multi-factor authentication systems by moving a victim’s phone number onto a SIM card under the perpetrator’s control. With this access, attackers intercept verification codes sent via text message and use them to impersonate the victim, carrying out unauthorized transactions from their accounts.
After each theft, stolen assets were moved through several cryptocurrency wallets before being consolidated into one wallet funding an account at Stake.com, an online casino. Many transactions were circular—funds would eventually return to their original source—an approach often used for money laundering and disguising criminal proceeds.
For example, between March 20 and March 22, 2023, following consolidation of some victim funds into a single wallet, that wallet and the Stake.com account executed at least 32 circular transactions involving repeated deposits and withdrawals of bitcoin. Such activity is intended to obscure the origin of funds by increasing transaction volume so that illicit gains appear as legitimate business activity.
Individuals seeking information on SIM swapping prevention can visit www.ic3.gov/PSA/2024/PSA240411 for resources.
The prosecution team includes Trial Attorneys Jessica Peck and Gaelin Bernstein from the Computer Crime and Intellectual Property Section (CCIPS), along with Assistant U.S. Attorneys Kevin Rosenberg, Alexandra Hughes, and Asset Forfeiture Coordinator Rick Blaylock Jr., all from the District of Columbia.
CCIPS collaborates with law enforcement agencies both domestically and internationally in cybercrime investigations. Since 2020, CCIPS has secured convictions against more than 180 cybercriminals and recovered over $350 million for victims through court orders.
