The US Federal Bureau of Investigations (FBI) said that the $15.3 million that a Nigerian scammer stole from two Chicago-based firms might not be recovered because the funds were converted to Bitcoin.
Alleged Nigerian Scammer Arrested, But He Apparently Doesn’t Reveal Bitcoin Keys
Nigerian media reported that Olalekan Jacob Ponle, nicknamed Woodberry, organized large-scale business email compromise (BEC) schemes. He targeted employees of two Chicago-based firms and manipulated them to conduct unauthorized transfers to his accounts.
BEC schemes represent phishing-like attacks that target employees by sending them spoof emails that fraudulently represent senior executives. Ponle made company workers believe the email messages came from their chief account officers.
Ponle was arrested last week by the Dubai Police along with Ramon Olorunwa Abbas, aka Hushpuppi, and ten others as a result of the special operation Fox Hunt 2. The group allegedly ran a cyber-fraud worth about $431 million, according to reports. The scheme was global and involved 1.9 million victims.
All arrested members, including Ponle, have been extradited to the US. They now face charges of conspiracy to commit fraud.
Even though Ponle is in the hands of the US law enforcement, the FBI reportedly said in an affidavit (a statement for use as evidence in court) that the stolen funds Ponle converted to Bitcoin may not be recovered. The FBI specified that the scammer received over $15 million from the two companies between January and September of last year.
The FBI didn’t specify why the two US firms might not recover the stolen funds. However, it most likely has to do with blockchain’s immutability and the fact that Ponle is the only person who has access to the private keys related to those funds.
Preliminary Data Suggests Ponle Ended Up with $6.7M in BTC
The FBI said that one of the two companies was defrauded of $2.3 million, while the other one lost over $15 million, part of which was eventually moved to a Bitcoin wallet. The affidavit reads:
“Preliminary blockchain analysis indicates that PONLE received at least 1,494.71506296 bitcoin related to these BEC schemes, valued at approximately $6,599,499.98.”
“These schemes resulted in attempted and actual losses to victim companies in the tens of millions. PONLE directed money mules in the US to open bank accounts in the names of victim companies,” the statement added.
The funds from BEC schemes were then transferred by unsuspecting employees to the bank accounts opened by Ponle’s mules. For those unfamiliar, money mules are persons recruited by criminals that share their bank details so that criminals’ money could be deposited.
Ponle then required the mules to exchange the proceeds into Bitcoin and send them to his wallet.