ICE HSI investigation results in prison sentence and restitution for international hacking group members who stole millions in cryptocurrency
DETROIT – A sixth member of an international hacking group known to its members as “The Community” was sentenced yesterday in connection with a multi-million-dollar SIM Hijacking conspiracy.
This case was investigated by U.S. Immigration and Custom Enforcement’s (ICE) Homeland Security Investigations (HSI) special agents with the assistance of Irish law enforcement authorities.
The announcement was made by acting U.S. Attorney for the Eastern District of Michigan Saima Mohsin and acting HSI Detroit Special Agent in Charge James C. Harris.
“The illegal activities of 'The Community' were thwarted as the result of a complex international cryptocurrency and identity theft investigation,” said HSI Detroit acting Special Agent in Charge James C. Harris. “As criminal organizations commonly use web-based schemes to further their illicit activities, this demonstrates how vulnerable our personal information can be, and the damage that can ensue when our information falls into the wrong hands.”
After previously pleading guilty, Garrett Endicott, 22, of Warrensburg Missouri, was sentenced to serve 10 months in prison and pay restitution in the amount of $121,549.37. He was the final defendant to be sentenced in this case, which was indicted in 2019.
“SIM Hijacking” or “SIM Swapping” is an identity theft technique that exploits a common cyber-security weakness — mobile phone numbers. This tactic enabled “The Community” to gain control of victims’ mobile phone number, resulting in the victims’ phone calls and short message service (SMS) messages being routed to devices controlled by “The Community.” SIM Hijacking was often facilitated by bribing an employee of a mobile phone provider. Other times, SIM Hijacking was accomplished by a member of “The Community” contacting a mobile phone provider’s customer service — posing as the victim — and requesting that the victim’s phone number be swapped to a SIM card (and thus a mobile device) controlled by “The Community.”
Members of “The Community” engaged in SIM Hijacking to steal cryptocurrency from victims across the country, including California, Missouri, Michigan, Utah, Texas, New York and Illinois. Cryptocurrencies, aka virtual currencies or digital currencies, are online media of exchange. The most famous of these is Bitcoin. Like traditional currency, they act as a store of value and can be exchanged for goods and services, as well as dollars.
Once “The Community” had control of a victim’s phone number, it was leveraged as a gateway to gain control of online accounts such as a victim’s email, cloud storage, and – ultimately – cryptocurrency exchange accounts. “The Community” would use their control of victims’ phone numbers to reset passwords on online accounts and/or request two-factor authentication (2FA) codes that allowed them to bypass security measures.
In total, “The Community’s” scheme resulted the theft of tens of millions of dollars’ worth of cryptocurrency. Individual victims lost cryptocurrency valued, at the time of theft, ranging from under $2,000 to over $5 million. The sentenced defendants were involved in total thefts ranging from approximately $50,000 to over $9 million.
Individuals who previously pleaded guilty and were sentenced in the eastern district of Michigan include:
- Ricky Handschumacher, 28, of Pasco Country, Florida, sentenced to 48 months in prison and ordered to pay restitution in the amount of $7,681,570.03.
- Colton Jurisic, 22, of Dubuque, Iowa, sentenced to 42 months in prison and ordered to pay restitution in the amount of $9,517,129.29.
- Reyad Gafar Abbas, 22, of Charleston, South Carolina, sentenced to 24 months in prison and ordered to pay restitution in the amount of $310,791.90
Two defendants charged in the indictment were previously sentenced in other courts. Conor Freeman, 22, of Dublin, Ireland, pleaded guilty to parallel charges in Ireland and was sentenced to three years in prison by an Irish court. Ryan Stevenson, 29, of West Haven, Connecticut, pleaded guilty and was sentenced to probation in the district of Connecticut. Both were also ordered to pay restitution.
“The actions of these defendants resulted in the loss of millions of dollars to the victims, some of whom lost their entire retirement savings,” said acting U.S. Attorney Mohsin. “This case should serve as a reminder to all of us to protect our personal and financial information from those who seek to steal it.”
The case was prosecuted by Assistant U.S. Attorney Timothy Wyse, assisted by Assistant U.S. Attorneys Shankar Ramamurthy and Michael El-Zein as well as attorneys from the Justice Department’s Office of International Affairs and Irish law enforcement officials. Special thanks are due to Assistant U.S. Attorneys and federal agents across the country that provided assistance with arrests and searches conducted in May 2019.
HSI is a directorate of ICE and the principal investigative arm of the U.S. Department of Homeland Security (DHS), responsible for investigating transnational crime and threats, specifically those criminal organizations that exploit the global infrastructure through which international trade, travel, and finance move. HSI’s workforce of over 10,400 employees consists of more than 7,100 Special Agents assigned to 220 cities throughout the United States, and 80 overseas locations in 53 countries. HSI’s international presence represents DHS’s largest investigative law enforcement presence abroad and one of the largest international footprints in U.S. law enforcement.
Learn more about HSI Detroit’s mission @HSIDetroit.
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