Categories: Bitcoin Business

Criminals Use Bitcoin Tumbler to “Clean” $645,000 Worth of Funds Stolen Through Banking System

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One undisclosed UK-based regional water supply company has lost over $645,000 due to a very sophisticated scam. It appears the criminals used a combination of an inside man, social engineering, and wire transfers to get the money out. Unfortunately, it appears most of the stolen funds were converted to Bitcoin, even though cryptocurrency does not provide additional anonymity whatsoever.

Major UK Water Supply Scam Linked to Bitcoin

It is always troubling to hear criminals use nefarious tactics to scam people. Things only get worse when they use the stolen funds to buy Bitcoin, which gives the popular cryptocurrency a very bad name. In this particular incident, an undisclosed UK water supply company lost $645,000 due to a very thorough scam conducted by unknown assailants.

Things started to unravel once the water supply company found out several of their clients were locked out of their accounts. To be more specific, it appears a data breach has been carried out against the supplier. Once clients regained access to their account, they noticed new banking details have been assigned to the profiles. That was only the beginning of the concerns of this UK company, though, as the real damage appeared to be a far more severe.

It is worth mentioning the bank details were changed thanks to someone helping the scammer from the inside. A call center employee was apparently taking pictures of work PC’s screens and sending information to his cousin. The cousin could then issue a password reset for the accounts to gain access to them. The first thing he did was updated the bank account details and issue a refund to his own account.

A further investigation revealed all affected accounts have been subject to a refund request for previous transactions. The total funds are worth over 500,000 GBP, all of which were sent to two different UK bank accounts. Interestingly enough, the two banks were a victim as well, as someone tricked them into sending over 90% of all the funds overseas. Transfers were made to international banks located in the Bahamas and Dubai.

From here on out, the entire ordeal only becomes even more confusing. Somehow, the money was converted into Bitcoin and sent through an undisclosed tumbler service to erase the “taint” associated with the money. It is unclear whether or not the money has been retrieved right now, although it seems fair to assume the police have no idea where to look. Bitcoin is not anonymous by any means, yet tumblers provide a certain degree of anonymity to help cover up tracks.

All of this goes to show Bitcoin is not necessarily facilitating organized crime by any means. The scamming itself was done using traditional bank accounts, which were then later used to buy Bitcoin and anonymize it through a tumbling service. Although this makes it harder to recover the stolen funds in question, it is doubtful the water supply company would have been able to retrieve funds through the banking system either.

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