After a six-day outage, Colonial Pipeline reportedly paid almost $5 million in bitcoin to Eastern European hackers to restore functionality to the largest pipeline in the U.S., according to reports. Analysts have traced the bitcoin wallet used by the hackers to one owned by the DarkSide ransomware affiliate, which announced it would be ending operations after its servers were seized and its cryptocurrency was drained.

Eleven individuals were arrested in Europe on May 11 for their links to a criminal network involved in investment fraud, money laundering and a trading scheme resulting in almost ?30 million in losses. According to a press release, the criminal network created different fraudulent trading platforms advertising substantial profits from cryptocurrencies.

This week, the Office of the Comptroller of the Currency (OCC) issued a warning concerning a fraud scheme in which consumers have been receiving fictitious email messages, alleging to be initiated by the OCC or senior officials of the agency, regarding funds purportedly under the control of the OCC. The scheme reportedly involves requests for users to provide bitcoin wallet addresses for a purported transfer of funds.

Meanwhile, although crypto hacks and thefts are bringing smaller amounts of money to illicit actors this year, a new report shows an alarming trend in DeFi hacks. According to the report, while DeFi hacks made up approximately 25 percent of total hack and theft volume in 2020, they now make up more than 60 percent of the total volume. The report also notes that, at $156 million, the amount taken from DeFi-related hacks in the first five months of 2021 already surpasses the $129 million stolen in DeFi-related hacks throughout all of 2020.

For more information, please refer to the following links:

    Colonial Pipeline Paid Almost $5M Crypto Ransom Soon After Attack: Report
  • Elliptic Follows the Bitcoin Ransoms Paid by Colonial Pipeline and Other DarkSide Ransomware Victims
  • DarkSide Ransomware Gang Quits After Servers, Bitcoin Stash Seized
  • TRADING SCHEME RESULTING IN ?30 MILLION IN LOSSES UNCOVERED
  • Fictitious Regulatory Agency Notifications: Fictitious Notification Regarding the Use of Bitcoin Wallet for Release of Funds Supposedly Under the Control of the Office of the Comptroller of the Currency
  • Cryptocurrency Crime and Anti-Money Laundering Report, May 2021

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Mr Jordan R. Silversmith
BakerHostetler

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