FTX Faces Massive Crypto Losses of $400M in SIM-Swap Attack, DOJ Reveals

• FTX crypto exchange loses $400M in a sophisticated SIM-swap attack.
• DOJ indictment reveals details of the two-year-long hacking scheme targeting FTX.

Sophisticated SIM-Swap Scheme Unravels FTX Crypto Heist

In a recent revelation, the U.S. Department of Justice (DOJ) disclosed that the defunct crypto exchange FTX suffered a staggering loss of over $400 million in cryptocurrency. The significant breach occurred due to a sophisticated SIM-swap attack orchestrated by three individuals, according to an indictment filed in federal court in Washington.

Three Individuals at the Center of the Attack

The DOJ has identified Robert Powell, Emily Hernandez, and Carter Rohn as the key players in a SIM-swapping ring that targeted FTX over two years. The modus operandi involved gathering personal information from numerous victims, which was then used to convince cell phone providers to transfer the victims’ phone numbers to a fraudulent device controlled by the attackers. This enabled the group to intercept text messages, including multifactor authentication codes crucial for account security.

Indictment Reveals Infiltration Tactics

While the court filings referred to the victimized company as “victim company-1,” sources familiar with the case confirmed that it pertains to the crypto exchange FTX. According to the indictment, on November 11, 2022, Emily Hernandez utilized a fake ID containing details of an FTX employee to persuade AT&T to transfer the mobile phone account to a different SIM card.

Subsequently, Robert Powell, known by online aliases ‘R$’ and ‘ElSwapo1,’ attempted various authentication codes to gain unauthorized access to FTX’s cryptocurrency wallets.

FTX’s Turmoil Continues Post-Bankruptcy

The shocking revelation comes when FTX has already been grappling with its financial turmoil. In November 2022, the crypto exchange made headlines by filing for Chapter 11 bankruptcy, exposing an $8 billion shortfall in its accounts. FTX founder Sam Bankman-Fried now faces severe legal repercussions, potentially leading to a maximum imprisonment term of up to 100 years on multiple charges related to the crypto debacle.

Also Read: The Rise and Fall of FTX: A Cryptocurrency Exchange’s Dramatic Journey