A man from San Francisco lost $1 million after what seemed to be a problem with his cell phone signal.
The man had no idea that a hacker had taken control of his phone until he realized that his money was gone.
The victim, Robert Ross, went to an Apple store for help once he noticed that his phone had lost its signal.
His next move was to call AT&T, his service provider. Unfortunately, by the time he had dealt with the signal problem, his money was already in the hacker's hands.
Ross had two cryptocurrency accounts, Gemini and Coinbase. The hacker had stolen $500,000 from each of the victim's accounts.
Ross filed a felony complaint against the hacker, who had pulled off the scheme using a method known as SIM swapping.
The Man Behind the Hack
Nicholas Truglia, the alleged hacker, is a 21-year-old resident of Manhattan. He is facing a charge for not only that one crime but also for attempting to victimize other people, including several Silicon Valley executives.
According to the prosecutors, Truglia had tried to hack the cell phones of many of these executives. However, he was not successful in draining their accounts.
The targets reportedly included 0Chain CEO Saswata Basu, Hall Capital Partners VP Myles Danielsen and SMBX Co-Founder Gabrielle Katsnelson.
So far, Truglia has 21 charges that involving fraud, identity theft and embezzlement, attempted grand larceny and crimes involving felony conduct.
Truglia has allegedly hacked into the cellphones of more than five victims.
His charges have come from the REACT task force, a tech crime investigation team that works with the Santa Clara County District Attorney's Office.
Earlier this year, REACT investigated a similar case involving a series of cryptocurrency thefts traced back to Joel Oritz, a SIM swap fraudster in Boston.
Santa Clara Deputy District Attorney Erin West stated that the task force works on a national level.
Therefore, the authorities will investigate and prosecute anyone whose victim is within Santa Clara, no matter their location.
West reported that there is a new trend of crime involving robbery through cryptocurrency.
These criminals hunt down people they think have cryptocurrency and attempt to steal their money.
According to West, Ross was planning to spend that money on his daughters' college funds. He had initially saved the cash in U.S. dollars in the two cryptocurrency accounts.
However, after Truglia accessed this money, he turned it into cryptocurrency and moved it into his accounts.
REACT officers worked with agents of the U.S. Secret Service to hunt down the suspect. They acquired a search warrant for Truglia's house, where they found and arrested him.
The officials searched Truglia's computer and found $300,000 on his hard drive. However, it may be a challenge tracking down the rest of the money.
Truglia accepted extradition. Officials from Santa Clara will pick him up in December before the court sets a date for his hearing. Currently, Truglia is at the Manhattan Detention Complex.
Before his arrest, Truglia had accused his friends of torturing him to give up his cryptocurrency account details.
Based on his complaint, one of his friends drowned him in a bathtub, threw wax on him and punched him in the stomach.
Truglia reported that the three men stole two of his mobile phones, his laptop as well as a thumb drive which had his cryptocurrency data.
However, he did not indicate anything about his friends hacking into his accounts.
Nonetheless, during Truglia's hearing, the defendant stated that he had dropped the charges against his friends.
Cryptocurrency Hacking on the Rise
The users of cryptocurrency find it more reliable than the other forms of banking and transactions.
All cryptocurrency transactions go into the blockchain, which is a publicly available ledger.
Although a person's transactions are available to multiple users, their identity remains unknown. Cryptocurrency users find this level of privacy convenient.
Since 2017, the popularity of cryptocurrency has significantly grown. However, it has led to numerous cases of hacking.
Coindesk reported that by June this year, cryptocurrency users had lost a total of $ 1.6 billion to hackers.
The crimes have led to the depreciation of cryptocurrency. Bitcoin, for instance, depreciated by over 75 percent since December 2017.
The SIM Swapping Technique
Fraudsters have been using the SIM swapping technique to access their victims' cell phone details. They take over their victims' phone numbers through dubious means.
These hackers manipulate the victims' details to get authorization from the wireless carriers.
It is easy to transfer a person's phone number into another phone as long as the wireless employees have the right authentication details.
Wireless employees ask for such personal details as your social security number or birthday.
Hackers with access to this information can use it for the SIM swap and take control of their victims' phones.
Mobile phone owners connect their devices with loads of services and subscriptions that include bank accounts, credit cards as well as cryptocurrency wallets.
Hackers, thus, can quickly drain the users' money from their accounts.
Most online accounts apply the two-factor authentication method to ensure that the user is aware that there has been a login attempt on a foreign device.
However, seeing that the hacker has control over their victim's, they can easily login before the original owner can intercept them.
Cybersecurity experts say that cell phone users can prevent these attacks. For one, they can keep their money safe by using cold storage.
This type of storage makes it hard for hackers to steal from their targets as it allows its users to store their digital funds offline.
