So 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." ;)
I 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.
> 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?
Or 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.
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.
The 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.
The video reminds me that sometimes I feel tempted to add something to the graffiti in places in Shibuya, or Akiba where it's already teeming. Life here in offices day in and day out is extremely boring, and any given change you might want to make to your life whether you're a local or a foreigner has a hundred and eight barriers. I tell myself the excitement isn't worth the risk, but that's backwards; risk is part of the excitement.
From what I understand, going to trial in Japan is mostly determining your sentence, guilt is the default assumption. Getting a not guilty verdict is incredibly rare.
Japanese legal system is a bit like a car with missing trim pieces that were to be installed before the sale. Like you are supposed to be able to place your hands on the middle of the dashboard in rough roads, but in this car you have to carefully hold at edges, gloved. There seems to be law texts and systems which intent or behavior or actions to be taken is only clear with the knowledge of legal systems in other nations.
The 5th Amendment only works if law enforcement honor it. In my case I wasn't given a call to a lawyer and they refused to honor my requests to not speak, repeatedly. Then they made threats against my wife and I told them to write whatever they wanted and I would sign it.
[counter-intuitively you have to tell law enforcement you don't want to speak, you cannot just remain silent to invoke your right to silence: "The Court held that because Thompkins did not say he wished to remain silent or did not wish to speak to the officers, he had not invoked the right to remain silent." https://www.tdcorg.com/article/invoking-right-to-silence-mus... ]
> [When] a suspect in an interrogation told detectives to “just give me a lawyer dog,” the Louisiana Supreme Court ruled that the suspect was, in fact, asking for a “lawyer dog,” and not invoking his constitutional right to counsel.
I feel like they should have at least given him a phone call to try to find a lawyer dog. I don't know how many dogs have passed the bar, but in terms of my dog, if you find the right treats she'll do any trick you can think of, and several you can't. The other day someone gave me some organic chewy treats and I showed those to her and she actually filled out my 1099 Form for me and found several deductions I hadn't previously seen.
If you rob a bank and hide the money, and then get caught, you will be "coerced" to tell the police where you hid the money. The "coercion" will be "your willingness to cooperate will be taken into account at your sentencing".
This is both normal and good. Suggesting otherwise would be ridiculous.
Stealing is kind of morally wrong as well. And if this guy was innocent, it would have been hard for them to get the private key out of him, since he wouldn't have known it.
The 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?
>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).
Its 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.
so 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
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.
He 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.
You can't use "someone being caught" as evidence of "how easy it is not to get caught" - because you would also treat NOT getting caught to prove the same thing. This would mean that no matter what evidence you observe you would reach the same conclusion... which means the article made no difference to you.
To go into more detail, claims like "he was only barely caught" shadow the possibilities of him being caught later, which never had a chance to be realized. i.e. it may appear that he was caught randomly but we owe it to truth to at least dig into what would have happened if that had failed - and that likely requires a domain expert to know the actual security measures in place.
In my highly regulated and audited work, there are cases where people on money laundering lists initiate a transaction, and we can’t block it because it would tip them off that they have been detected, in theory some other department or organization is supposed to follow up
They 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.
Im not holding anyone responsible, im just mentioning that, it's obvious that a lot of the money flowing into crypto its not legal, this sets a clear example of how easy stolen money was washed using coinbase without much problems, its a clear indicator for the big picture, when exchanges like binance has 10x more volume, where do u think that money is really comming from? and that is actually happening on those exchanges with money flowing?
You're making a point about how it was so easy for the perp to get money into crypto while seemingly ignoring the fact that it was equally easy for him to move the money around via the traditional banking system.
Must has been a really shitty bank. And they do exist for sure. Lot of people were at fault here. I know if it were my bank, I would be getting a call from them asking them if something is up. "Hey, just wanted to make sure, you are actually authorizing all this cash right?"
Exactly. This is probably the best outcome for the owner of the money. I remember reading a story about how the government recovered supposedly millions of dollars worth of diamonds but was unable to unload those diamonds for anywhere the amount the criminal bought it for. I would have thought the government would force the people who sold the diamonds to take it back and reimburse the government in full.
> Just the fact that he was in tokyo (japan), instead of a non US aligned country, such as Russia or China,
Coinbase does not serve PRC citizens or Russians (see https://www.coinbase.com/places). Exactly so that any money laundering can be caught by US government.
What should have coinbase done? $150m is not a biggest of sums they handle daily for random persons. All you have to have is a bank account and a succesful deposit. Why should coinbase even care, if all regulatory rules were fulfilled?
Why should I care that some people I am helping are sometimes criminals, maybe
Don’t put words in a mouth that never said it.
And as a person (citizen), yes. As a business, one doesn’t care if bread or guns they make help potential criminals to live or murder. If you don’t ask your customers if they are “bad guys who have all the paperwork but still stolen this money” at the doorstep, don’t blame others. Regulations are there for you to not trouble your head about it, just follow them.
I’d like to see statistics on businesses doing beyond-regulatory investigations on who their clients are. Even anecdotal ones will do, just to learn what you mean.
Do note that the Coinbase business account was created by him fraudulently in the name of the subsidiary of the company (Sony Life) , but actually he had no authorization to do so. [0]
Because the fiat was easily recoverable in the traditional financial system. If they had not caught the guy, or he had already moved the BTC to a mafia-run account, not one he still controlled, it could be lost forever - The great 'benefit' of BTC is that the government has a hard time seizing it.
> Because the fiat was easily recoverable in the traditional financial system
This is a downright lie, I’m not sure why people keep repeating it. Doesn’t stand to the least bit of scrutiny, BEC schemes are stealing billions and billions via the traditional financial system. Once that money gets sent overseas, nothing is easy.
Hard work to stop it? There was a global insurance company that sent an international wire, at least two banks with multiple transactions, and coinbase which is a KYC compliant publicly traded company. Despite ample opportunity, no one stopped this, rather they all facilitated it. This all originated from an email containing fraudulent wire instructions, trying to pin all this on cryptocurrency is less sound than blaming email.
Despite all the deflection, law enforcement was able to recover the Bitcoin. Contrary to your point law enforcement and regulators alike have successfully brought legal actions (civil) and prosecutions (criminal) in the blockchain space just as they have against traditional institutions.
The insurance company, banks, and coinbase are all to happy cryptocurrency was involved at some point so they can do some magic hand waving, and blame cryptocurrency. I would ask why bother, but obviously it’s a successful PR campaign to excuse their own ineptitude.
I worked at a company headquarters and some guy in accounting just switched the banking info for one of the vendors to his own bank info. He stole money for literally years. I don't know how it worked for so long because somehow the vendor must've been getting paid, maybe he was also falsifying invoices or something. I dunno. Anyways, no crypto and this was the corporate headquarters for a company most Americans would know.
I don't think ppl appreciate just how big crypto is. $150 million is tiny compared to how big crypto is ($2.3 trillion). We're taking $60 billion of BTC being traded daily. And same for tether and eth. It's just insane. So it's possible that $150 million could slip through. Crypto is huge. Way bigger than online gambling, sports betting, etc.
The company I work at trades crypto deposited/withdrawn from real USD and EUR bank accounts as it would be with any stock exchange broker account, all legal. You may now reduce your fiction percentage to 99.9…9% at least, unless I’m lying for some conspiracy reason.
multiplying the current price by the number of coins just doesn't mean anything
It is also true for any regular stock. “Market cap” is just an indicator value of a stock at a given time, not the value, and no one expects all of it to be sold at that sum, because of market dynamics. The resulting number doesn't represent anything real regardless of the asset class. The only difference between crypto and some stock market traded company shares is that the latter has usually a known non-zero value at the assets level, everything else is just a thin air of trust and expectations. You may see cryptohead-ance as crypto’s base assets.
Yes, The market cap of a company is an indicator, but it is an indicator of something real: Acquiring the full ownership of the company.
The market cap of crypto doesn't even indicate anything. "Buying every bitcoin" doesn't mean anything. There's no value in doing so, unlike buying an entire company.
I think you err in this part. It doesn’t mean anything to you, if you’d buy that. Well, buying all of rice doesn’t mean anything to me (I can’t eat it for unrelated reasons and have no other uses beyond that). But other people value some properties of crypto, in the same way they value e.g. Intel much more than its raw factory floors and assets. Nobody would buy crypto if they thought it is worthless. But they have thought otherwise. They bought it at 0.00001, at 0.1, at 100 and at 60000 USD. You are basically saying that you don’t need crypto, even all of it for zero money. Well, this is a personal choice, not something one has to argue with or prove to others. People define value by supply and demand. Market cap is an aggregate indicator of their supply/demand equilibrium times the circulation volume.
No, it still means nothing. The essential difference here is that if you buy all the stocks of a company, you own the company. The company still exists, it is still working, but it is now all yours, and you can control it as you'd like.
If you buy every bitcoin, you have nothing. I don't meant that in the sense that bitcoin isn't backed by anything, I mean that in the sense that bitcoin is only meaningful when it is traded between people. If you buy every single bitcoin, bitcoin is dead. It is a nonsensical thing to do. Trying to figure out the price for which it can be done is nonsense, as well.
A person drained money from my account with a forged check. I obtained an image of the check. The payor name did not match mine. The address was in another state. The check paper was very different from mine. The signature was not my name. The handwriting was not mine.
The only thing that was mine on the check was the account number.
Yet the check sailed through and was honored and my account debited.
The bank insisted this was all my fault. The bank insisted they couldn't do anything about it. The bank insisted I call this number, which simply gave me more runaround. So I decided to camp out in the branch manager's office, until they gave up and refunded me the lost money.
The cake topper on all this is they then tried to sell me expensive check "security" paper.
I had a check stolen in the mail. It was cashed in the Dominican Republic. It was a real check but not to them. My bank stopped it, alerted me and blocked the transfer. I guess it depends on the bank a bit, but that had to suck.
What was surprising to me, is that my legacy account# were still in the system (My bank was bought and then bought... 4 times.. over the years).
The traditional similar thing would be the bank account that is emptied.
A forged check would not be sufficient at all. Even for 0,05% of the amount stolen here and it would only be where checks are valid ( would be worthless outside the US)
"Thirty-five fraudulent instructions were issued by security hackers via the SWIFT network to illegally transfer close to US$1 billion from the Federal Reserve Bank of New York account belonging to Bangladesh Bank, the central bank of Bangladesh. Five of the thirty-five fraudulent instructions were successful in transferring US$101 million, with US$20 million traced to Sri Lanka and US$81 million to the Philippines. The Federal Reserve Bank of New York blocked the remaining thirty transactions, amounting to US$850 million, due to suspicions raised by a misspelled instruction.[2] All the money transferred to Sri Lanka has since been recovered. However, as of 2018 only around US$18 million of the US$81 million transferred to the Philippines has been recovered.[3] Most of the money transferred to the Philippines went to four personal accounts, held by single individuals, and not to companies or corporations"
Not sure if you are trying to make a joke that I'm missing? If not..no, the GP comment is referring to traditional financial institutions improperly wiring money.
I get that joke, basically people that criticize the entire concept of crypto assets frequently point to thefts of crypto assets and never apply the same standard to financial systems that they respect because they are completely unknowledgeable of the frequency and size of unreversible transfers in the traditional financial system.
and then they point to the user experience of how banks at least pretend like the money was returned, which is convenient for the user, something that is also possible to do with using an optional bank custodying crypto deposits.
>people that criticize the entire concept of crypto assets frequently point to thefts of crypto assets and never apply the same standard to financial systems that they respect because they are completely unknowledgeable of the frequency and size of unreversible transfers in the traditional financial system
My comment was not intended to promote the idea that the existing financial system is comparable in the frauds and crimes that happen, just that it's an overstatement to say people never steal millions in an irreversible way.
He opened the Coinbase account under the bank's name, as a business account, with forged documents. A regular Coinbase account would never be able to do this. Coinbase was fooled in this scheme, but so were both banks, so this is not a case of Coinbase being uniquely vulnerable. And the Bitcoin shenanigans did not help this guy at all in the end, so this is not a case of crypto being useful for crime either.
What about this was supposed to raise questions? Large corporations engage in large transactions all the time. Elon Musk decides Tesla is going to buy $1.5 Billion in Bitcoin, so Tesla buys $1.5 Billion in Bitcoin. An electronics manufacturer needs millions of dollars worth of gold in order to make gold contacts for millions of electronic devices, so a truck appears containing millions of dollars worth of gold. It's not even weird.
The difference in this case is that he allegedly wasn't authorized, which means he's going to jail. But how is the bank supposed to know that?
Given the number of garbage companies that have managed and continue to manage to get themselves listed on Nasdaq or NYSE via reverse mergers, a listing on a US stock exchange just ain't what it used to be.
In the Chinese reverse merger fraud of the late 2000s/early 2010s there were hundreds of bogus companies that walked off with at least half a trillion dollars. Roughly 10X the size of the Madoff fraud.
Nasdaq currently has 4,826 listed companies and NYSE has 3,163. So yes, I would say it's significant when the frauds are within one order of magnitude of the total.
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.
>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.
Conducting 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.
How 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?
It’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.
Are you telling me that law enforcement is facilitating the sale of tens or hundreds of millions of dollars of drugs over the course of many years on the internet? These dark markets work - you get real drugs in the mail. I find it a little hard to believe they'd put so much effort into it, have the competence to do it, and facilitate so much harm at the same time.
Also compounded that some markets require Monero - why would they require something that makes their jobs harder?
What 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.
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.
>"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.
I’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.
OPs 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.
Makes 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?
I 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.
I 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.
The 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...
