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US returns $154M in bitcoins stolen by Sony employee
- tanseydavid 5y ago> However, on December 1, following an investigation in collaboration with Japanese law enforcement authorities, the FBI seized the 3879.16242937 BTC in Ishii's wallet after obtaining the private key, which made it possible to transfer all the bitcoins to the FBI's bitcoin wallet. But the really big question (not addressed in the article) is this: How did the FBI get the private key(s) for the wallet?
- rhtgrg 5y agoProbably like this [0] but with less violence and more credible threats post custody. [0] https://xkcd.com/538/ https://xkcd.com/538/
- pxmpxm 5y agoCame to post the same; $5 wrench method never fails
- user-the-name 5y agoThe "threat" is that your cooperation will be taken into account at sentencing.
- ceejayoz 5y ago“Wanna go to jail forever, or just a few years? Your choice.” Tends to be effective. The entire US justice system relies on this dynamic. It cannot handle even a couple of percent of cases making it to trial.
- suifbwish 5y agoThat $3 hammer is pretty effective for breaking encryption
- nyolfen 5y agothey may have threatened extradition, even if the jp authorities wouldn’t have followed through it would be a useful tactic
- anfilt 5y agoBasically rubber hose crypto analysis, but is there any evidence of this? The article makes no mention of it. Like the could have also seized is electronic devices and just found a copy of the key somewhere.
- DennisP 5y agoOr they got a search warrant and found his 24 words, in his house or safe deposit box. Or they surveilled him and found where he hid them. It's pretty hard to keep your keys safe from an attacker able to do that sort of thing, without adding serious risk of accidental loss.
- paulpauper 5y agoyeah he was probably sloppy
- paulpauper 5y agoas usual, key (no pun indented) details intentionally left out
- PKop 5y ago>The article makes no mention of it And I would bet the FBI is not going to say publicly. It could be beneficial to the US Government to have people believe they have the capability to just steal private keys, even if in fact they just negotiated for it.
- ceejayoz 5y agoBoth are plausible avenues, sure. Ultimately, the point is “once law enforcement has you and your devices in their hands, it’s probably all over”.
- javajosh 5y agoThe implication is really strong here that they'll coerce you, and that's okay. I hope they don't, and it's not okay if they do. You should be able to invoke the 5th and be silent on any matter, including producing information required to decrypt a private key. Of course, this happened in Japan, it sounds like, and perhaps they have different rules. If so, that sucks and they should change them because torture is morally wrong.
- 8ytecoder 5y agoBut, wasn't he arrested in Japan?
- andrewxdiamond 5y agohttps://xkcd.com/538/ https://xkcd.com/538/
- loeg 5y agoThe article suggests they got the private key (Dec 1) before moving on him (today), although I suppose it’s possible that they got him to talk first. But if it’s that, why even mention private keys?
- Consultant32452 5y agoOh man, can you imagine thinking you successfully stole $154M and then it just vanishes from your bitcoin wallet?
- desdiv 5y ago>Tokyo's Metropolitan Police Department arrested the 32-year-old Ishii the same day and criminally charged him on suspicion of obtaining $154 million dollars following fraudulent money transfers from mid-May. The private key seizure and the arrest happened on the same day (Dec 1).
- rasz 5y ago'I want to talk to my $10M/year lawyer'
- unixhero 5y agoAaahh the old baseball bat method of cryptography brute force.
- vmception 5y agoIts not the first time they’ve been vague about this. Their wording actually in other cases makes it seem like they have already derived the private keys and move to seize it once establishing any US nexus. They’ll say things like “we noticed we had that private key” and ask a judge for forfeiture, which is surprisingly professional restraint but curious. Should be investigated further. People should use multisig in something brazen and see if it still happens. Taproot helps make multisig use indistinguishable from non-multisig.
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- firekvz 5y agoso the guy went ahead and stole 154 millions from a business bank account, deposited it in coinbase and he just casually bought almost 4k btc and then withdrew it and coinbase didnt even say a word? and then I see poeple defending btc price action being legit if this guy was able to do that, in a company that is part of nasdaq, has sec watching it and so on, imagine whats happening on binance and all those others offshore/shady exchanges
- aeternum 5y ago>this guy was able to do that The guy was caught in short order so he really wasn't able to do it. You can steal money pretty easily in the traditional financial system with a simple forged check. Money will likely go through initially but you also will likely be caught in short order.
- firekvz 5y agoHe already had the BTC in a cold wallet, meaninig that the whole process was completed (deposit USD into coinbase, exchange to BTC, withdraw it) My point is, coinbase still allowed 154millions USD to be washed on it's exchange. By a random guy who clearly didnt even bother cover his back, imagine what actual organized crime is doing with offshores exchanges.
- bogota 5y agoIm trying to imagine it can you help me? Just seems like a classic slippery slope fallacy to me though.
- fastball 5y agoClearly the funds weren't "washed", because they traced them... KYC isn't meant to prevent money from moving at all, it's meant to enable tracing of the money.
- firekvz 5y agoThey traced him, because, it seems that he wasn't the smartest criminal in the planet. Just the fact that he was in tokyo (japan), instead of a non US aligned country, such as Russia or China, that he had his private keys easy accesible and that he stayed in BTC instead of going for another crypto more anon friendly, says a lot of the stupid nature of this "criminal" But once again, my whole point is, coinbase allowed a random person to deposit 154 millions USD and withdraw 3.8k btc with absolutely no problems? and in a quickly way, according to the original article I think its safe to assume that the banks said, okay the money went to coinbase, and coinbase just said yeah about that, he used the money to buy BTC and withdrew it to this wallet and thats about it the guy was located cause he didnt even try to hide himself, the rest is history. my point remains, if this, that was a such dumb crime, managed to convert the stolen funds into BTC using coinbase with absolutely no problems, then its easy to assume that real and strong money going to biggest offshores exchanges is from illicit sources.
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- FridayoLeary 5y agoHere's the original https://www.justice.gov/usao-sdca/pr/united-states-files-civil-action-return-150-million-embezzled-funds-sony-fbi-tracks https://www.justice.gov/usao-sdca/pr/united-states-files-civ... >"This case is an example of amazing work by FBI agents and Japanese law enforcement, who teamed up to track this virtual cash. Criminals should take note: You cannot rely on cyptocurrency to hide your ill-gotten gains from law enforcement," said Acting U.S. Attorney Randy Grossman.
- perryizgr8 5y ago> virtual cash Heh... I would wager most of the world's USD is equally virtual.
- iamleppert 5y agoJudging by the timing, he likely made them millions with his “investment” and is still going to jail!
- coldacid 5y agoThat assumes that the FBI didn't give Sony the original amount back in USD or JPY and kept the exchange rate profit for themselves.
- _carbyau_ 5y agoMakes you wonder. If he had've kept it for a day or so, then simply returned the money (similarly anonymously, preferably better than he did it...) and kept the gains, would they have chased him down?
- xupybd 5y agoI think that is what he attempted to do
- _carbyau_ 5y agoI guess I was thinking a little less dramatically, making it look more like an accident. IE rather than biding time for multiple days and sending threatening ransom notes, if the money simply turned up a day later with a transaction description of "I don't think you meant this for me." But then, it isn't exactly hard for people to guess the motive behind a days holding of large sums of money and the "business email compromise" is pretty blatant.
- fy20 5y agoDo it over a holiday weekend. US banks are notoriously slow anyway.
- paulpauper 5y agoyes. a crime was still committed
- nuclearnice1 5y agoHere’s the complaint https://www.courthousenews.com/wp-content/uploads/2021/12/usa-ishii-forfeiture.pdf https://www.courthousenews.com/wp-content/uploads/2021/12/us... Some classic social engineering when he calls Citibank and convinces them to change they email address they have on record for approving transactions.
- buildbuildbuild 5y agoBlockchain activity: https://blockchair.com/bitcoin/address/bc1q7rhc02dvhmlfu8smywr9mayhdph85jlpf6paqu https://blockchair.com/bitcoin/address/bc1q7rhc02dvhmlfu8smy... I have no idea how this passed Coinbase's KYC limits, there must be much more to the story here. I can't imagine that it was a typical self-serve trade via their web UI, he surely developed some form of OTC relationship with Coinbase to pull off buying this much BTC and successfully withdrawing it. ~$144m of May 2021 BTC turned into ~$221m in December at the time of seizure, if they decide to realize the gains.
- desdiv 5y ago>I have no idea how this passed Coinbase's KYC limits, there must be much more to the story here. He fraudulently opened a Coinbase business account for SA Reinsurance, a Sony Life subsidiary. The SA Reinsurance documents he submitted were legitimate, but he was not authorized to open such an account.
- yawnxyz 5y agoI'm a massive crypto newbie and even I know doing this through Coinbase is a bad idea, and something something tornado cash or whatever. No idea how to turn fiat into crypto not through a Coinbase though
- solveit 5y agoYou do it P2P. Caveat emptor.
- pc86 5y agoNot $154 million worth you don't.
- paulpauper 5y agothis is not 2011. People want to yolo trade for 100x gains on alts on BInance or COinbase, not do p2p bitcoin anymore.
- post_from_work 5y agoTry using this: https://bisq.network/ https://bisq.network/
- paulpauper 5y agouseless. very little liquidity , very slow
- noway421 5y agoWhat verification level do you need in Coinbase to deposit $154 million? Pretty sure you're limited to a specific amount per year and you need to specify source of funds. AML/KYC rules are specifically created for this.
- desdiv 5y agoHe fraudulently opened a Coinbase business account for SA Reinsurance, a Sony Life subsidiary. The SA Reinsurance documents he submitted were legitimate, but he was not authorized to open such an account.
- numair 5y agoConducting crime using crypto is quite stupid these days, because there’s a large cottage industry of companies dedicated to de-anonymizing every single transaction that occurs on the major blockchains. You know how people criticize these blockchains for having slow transaction rates? Yeah, well, combine that with the fact that all of the transactions are public and that they tend to be interconnected (it’s a network after all) and it isn’t hard to see why chain analysis isn’t particularly difficult. My point is, even if this guy didn’t use Coinbase and went way off into the wilderness, they’d find him. I think the FBI et al let a lot of the lesser crimes go “unsolved” so criminals don’t get too smart about this too easily.
- authed 5y agoWhat about ZEC and XMR?
- ryanlol 5y agoYou are seriously overestimating the capabilities of blockchain analysis tools.
- beeboop 5y agoHow does that analysis work? If I buy drugs on the internet over dark market, how does a company know that the wallet I'm sending money to belong to a drug dealer? And if they don't know stuff like that then what's the point of the analysis?
- numair 5y agoIt’s amazing that people still don’t understand that a significant portion of “dark” markets are either created or controlled by law enforcement, often acting in a multinational collaborative effort that can go on for years without revealing itself to be a giant trap. This isn’t a conspiracy theory — it’s standard operating procedure. Again — for better or worse, a lot of crimes that matter to you and I are just not that important to people who view the full ecosystem of criminality from 10,000 feet up. Some of those dark markets are a lot darker than the others... Back to your point, how are you planning on converting your fiat into crypto, and are you sure that all of the other wallet addresses etc associated with the transaction are totally “clean?” And remember, ISPs etc are going to give up all of that info easily, so can you guarantee that those other wallets you used weren’t ever opened or accessed on the same network / IP / etc? Once you start aggregating data points it’s not terribly difficult for most transactions. Yes, there’s still some that are super hard, but you can imagine that de-anonymizing those would be a very fun detective game, rather than an impossibility that causes investigators to give up.
- shawnk 5y agoI’m starting to believe the government has a quantum computer that has the ability to process very large numbers ex 1 followed by 75 zeros. Cause they’re magically obtaining private keys. And we all know. They spend trillions to stay ahead with defense.. criminals tend to love crypto, so the government has to be a step ahead.
- perlgeek 5y agoIf they had that capability, they would use it for intelligence gathering, and not risking leaking information about it in some crypto BEC scam.
- akyoan 5y agoI have no proof here, but don't underestimate the power of a rock near one’s delicate areas. It's easier to get a key by just asking politely.
- perl4ever 5y agoEverything is stored unencrypted somewhere. Getting access to that somewhere might be easiest.
- kube-system 5y agoYou don’t need to crack the keys when it’s much easier to take them.
- rozap 5y agoOPs imagination: the government and the Illuminati have a many-qubit quantum supercomputer capable of deriving private keys and breaking into your 2048 bit encrypted cold wallet. Reality: FBI junior recruit hits you with a wrench until you tell them what the key is.
- ljoshua 5y agoSo from the wallet it looks like he transferred in the $154M on May 19, 2021, when BTC was about $36,600 (interestingly it was down ~14% that day, hello crypto volatility). Then when it was transferred back out on Dec 1, when BTC was about $57,000. Even if you take the opening price for May 19 ($39k) that's a tidy capital gain of around $69,822,000. Does Sony get to benefit from that, and should they be paying Ishii some investment fees here? Or maybe that just gets filed under "investigation costs." ;)
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- petronio 5y agoI suspect Sony will be getting $154M in cash rather than as bitcoin, as that's what was initially stolen. Whatever is left after the US government auctions it off stays with the US government.
- cstrat 5y agoI mean this kind of makes sense in a way, but if the BTC were worth less than the $154M the US govt. wouldn't make them whole... a little one sided.
- coolso 5y agoThe bitcoins weren’t stolen, they were purchased with stolen USD funds.
- unobatbayar 5y agoPerhaps, he could have avoided FBI entirely if he used non-American coin exchanges instead of Coinbase.
- beeboop 5y agoI really don't understand this guy. Why not just defect to some country that won't extradite you? I'd happily live out my days exiled to some country with my $154 million.
- cstrat 5y agoI am surprised this hasn't been spun with clickbait tagline like: Sony invested $150M into Bitcoin. Followed by a few rocket ship emojis.
- bellyfullofbac 5y agoThe headline is already clickbaity by including "bitcoin". The hadline makes it seem Sony had so many bitcoins, and they were stolen. No, Sony had cash, it was stolen, and got converted. An equivalent headline might be "US returns $154M in Lamborghinis stolen by Sony employee." and you'd be wondering Why Sony had so many Lamborghinis...
- niknoble 5y agoImagine if he had burned the bitcoin instead of sending it to his own wallet.