A federal judge approved a court order last October to recover over $600,000 in Bitcoin from the Huobi Global wallet, one of the largest cryptocurrency exchanges in the world, after federal investigators stated it was part of the $11.6 million stolen from an account of a user on the famous exchange Coinbase. The fraud dates back to April when a Coinbase user purchased 200 Bitcoins. The buyer received a notification warning them about the closure of their account, which appeared to be from Coinbase, but was actually a phishing notification, according to a complaint filed by the U.S. Attorney's Office in Los Angeles.
The court documents revealed that this notification was the first step in the fraud, during which 206 Bitcoins were stolen from the user's account in less than 10 minutes. Despite the secrecy around data in the world of cryptocurrency, as it is supposed to be, the investigations did not reveal how the scammer learned about the transaction that took place on the Coinbase account.
The Coinbase customer, referred to in court documents only as G.R., stated that he called a number provided in the notification, believing he was contacting a Coinbase customer service representative, as mentioned in a federal complaint filed by investigators last month. The other party on the phone responded, instructing him to make a series of changes to the account, including granting remote access to the account.
American attorney Dan G. Boyle wrote in a document filed in the U.S.: "Once access was granted to the victim's account, the scammer increased the daily transaction limit and also attempted to deactivate some notifications and alert settings in the victim's account." Investigators reported that within moments, millions of dollars in Bitcoin and Stellar cryptocurrency were removed from G.R.'s account.
They stated in their complaint: "The total value of the cryptocurrency transferred from the victim's account exceeded $11.5 million." The scammer also transferred funds through a series of transactions between several anonymous accounts, including an account belonging to one of the largest cryptocurrency exchanges in the world, known as Huobi Global, for about 10.2 Bitcoins. Investigators filed a notice of seizure in an effort to recover the cryptocurrency.
Meanwhile, Tom Marzouk, the media relations director at the U.S. Attorney's Office in Los Angeles, told Insider via email: "Huobi has agreed to keep the funds frozen pending resolution of the seizure case." He added, "No one has been arrested or charged, but our investigations are ongoing," according to what "Al Arabiya.net" reported.
