The Australian Federal Police (AFP) have joined forces with blockchain data platform Chainalysis to launch a global operation targeting criminal cryptocurrency scammers.
The initiative, dubbed Operation Spincaster, identified over 2,000 compromised crypto wallets belonging to Australians. This joint effort has uncovered the use of a technique called ‘approval phishing,’ which has resulted in the theft of more than $4 billion in cryptocurrency from victims worldwide since May 2021.
Approval phishing involves tricking victims into signing a malicious blockchain transaction. Once signed, criminals gain access to the victims’ crypto wallets, allowing them to drain the wallets of specific tokens at will. This tactic is commonly used in investment scams, where victims are lured with promises of high returns, and in romance scams, where criminals manipulate victims through feigned emotional connections.
AFP Detective Superintendent Tim Stainton emphasised the borderless nature of cybercrime and the importance of international collaboration. “Working together and sharing knowledge with industry, government, and law enforcement partners is crucial,” he stated.
“The intelligence gathered during Operation Spincaster has highlighted new tactics used by cybercriminals and will be vital in ongoing investigations.”
Chainalysis Director of Investigations Phil Larratt expressed pride in collaborating with Australian law enforcement, noting the positive impact of the operation. “Proactive initiatives like Operation Spincaster are pivotal in disrupting the global scam epidemic,” he said.
“We look forward to continued success in combating scams and supporting agencies in Australia and beyond.”
Operation Spincaster’s findings have led to ongoing AFP investigations into the identified Australian losses. The AFP has also gathered valuable intelligence on scam tactics, aiming to prevent further victimisation of Australians. The AFP-led Joint Policing Cybercrime Coordination Centre (JPC3) played a crucial role in the operation, collaborating with Chainalysis to target these scams.
Between April and June 2024, over 100 participants from digital currency exchanges and public agencies across the US, UK, Canada, Spain, Netherlands, and Australia engaged in training sessions as part of the operation. In June 2024, Australia became actively involved with the JPC3 hosting a workshop that brought together Chainalysis, digital currency exchanges, government bodies, and law enforcement agencies. The workshop focused on sharing intelligence, training on tracing stolen funds, and discussing how to support victims of approval phishing.
Australians are urged to remain vigilant against approval phishing and other scams. Key precautions include verifying transactions, being sceptical of urgent requests for money or information, researching the identity of individuals or companies, and trusting one’s instincts. For more information on approval phishing and other scam tactics, visit Chainalysis’ blog.
The AFP has also extended its gratitude to the digital currency exchanges BTC Markets, Binance, Crypto.com, Ebonex, Independent Reserve, OKX, SwyftX, and Wayex for their efforts in identifying and supporting Australian victims, helping to prevent further losses.
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