A 23-year-old Brooklyn man, Ronald Spektor, has been sentenced to four to 12 years in prison after admitting to stealing nearly $16 million from around 100 Coinbase users through phishing and impersonation scams.
Spektor pleaded guilty on Sept. 2 to all 31 charges in the case, including money laundering, grand larceny and possession of stolen property.
Brooklyn Supreme Court Justice Danny Chun handed down the sentence on Sept. 23. Spektor was also ordered to give up cash, cryptocurrency and other property worth more than $500,000 and pay nearly $16 million in restitution.
Prosecutors had asked for a prison sentence of seven to 21 years but opposed the four-to-12-year sentence included in his guilty plea.
The case came from a yearlong investigation by the Brooklyn District Attorney’s Virtual Currency Unit. Prosecutors estimated that about 100 Coinbase customers in the U.S. lost a combined $15.944 million. More than 70 victims were interviewed during the investigation.
According to prosecutors, Spektor contacted Coinbase users while pretending to be a Coinbase employee. He told victims that their accounts had been hacked or that their cryptocurrency was in danger.
He then convinced them to move their assets into new wallets that they believed were secure and under their own control. Investigators said Spektor was able to access those wallets and take the cryptocurrency after it was transferred.
The stolen funds were later moved through different cryptocurrency exchanges, swapping services and mixing services. Some of the funds were also sent to online gambling platforms and online stores.
Individual victims suffered major losses. One California victim reportedly lost more than $1 million, while a Virginia resident lost more than $900,000.
Another victim in Pennsylvania lost around $53,150 after receiving fake two-factor authentication messages followed by a call from someone claiming to work for Coinbase.
Investigators used blockchain records and digital evidence to track the stolen cryptocurrency. Authorities said Spektor’s home IP address was linked to several wallets that received funds from victims.
Prosecutors also said Spektor operated online under the username @lolimfeelingevil and used Telegram and Discord. Investigators recovered messages that allegedly showed him discussing cryptocurrency theft and recruiting others to help with social engineering attacks.
Authorities also seized around $105,000 in cash and approximately $400,000 worth of cryptocurrency during the investigation.
Coinbase helped investigators identify affected customers, trace the stolen funds and collect evidence used in the case.
The case also highlights the risks of cryptocurrency support scams. Coinbase warns that its support staff will never ask customers to move their funds to another wallet, provide a seed phrase, password or two-factor authentication code.
Following his conviction, Spektor now faces the prison sentence along with the financial penalties and restitution ordered by the court.
