Wave of Crypto Muggings Hits London's Financial District

Wave of Crypto Muggings Hits London's Financial DistrictCriminals in London are targeting digital currency investors on the street in a wave of “crypto muggings”, with victims reporting that thousands of pounds were stolen from their crypto wallets after their mobile phones had been forcibly taken.

City of London police provided The Guardian with several crime reports detailing how thieves have been able to take cryptocurrency by using both physical muscle and digital prowess. Here are a few examples of the incidents from those reports according to The Guardian:
  • A victim ordering an Uber near Liverpool Street station had muggers forced them to hand over their phone. He ended up getting the phone back, but by then the damage had been done as he realized While the gang eventually gave the phone back, £5,000-worth of ethereum digital currency was missing from their Coinbase account. 
  • A man was approached by a group of people offering to sell him cocaine and he willingly went down an alley with them to do the deal. The men said they were typing a number into his phone but in reality they went to his cryptocurrency account, and forcibly made him unlock the app with facial verification. They transferred £6,000-worth of ripple, another digital currency, out of his account.
  • A third victim said he was vomiting under a bridge when a mugger forced him to unlock his phone using a fingerprint, then changed his security settings and stole £28,700, including cryptocurrency.
  • In another case, a victim  was using his phone in the pub and believes thieves saw him enter his account pin to. His cards and phone were pickpocketed that evening, with £10,000 later stolen from his Crypto.com account.
  • A student in Kent claimed last year that eight people stormed his university accommodation and forced him to transfer £68,000 of bitcoin at knifepoint.
  • Later that year, the American technology entrepreneur Zaryn Dentzel told police he had been attacked at home in Madrid by masked thieves. He said they tortured him with a knife and stun gun before disappearing with millions of euros in bitcoin.

23-year FBI veteran Gurvais Grigg, who now works as public sector chief technology officer for Chainalysis, helps government agencies and financial institutions track movements of digital currency. He said the nature of cryptocurrency, where transactions are logged on the blockchain, means police should, in theory, be able to track stolen crypto.

“To [transfer stolen assets], they have to provide a wallet address and, most likely, they’ll use that wallet address again in the future. You also need to bring it to an exchange if you want to turn it into fiat currency.”

He said this creates a digital paper trail that investigators can and often do, use to track down crypto hacks. However, they are typically investigating multimillion-dollar crypto hacks and it's unlikely they have the resources to pursue smaller crimes like the ones reported here. 

“If they could put together a larger conspiracy of activity, where people are doing it more than once or twice, police services would likely pay attention.”

The nature of these crimes present new challenges for the police. Phil Ariss, who leads the cryptocurrency team on the National Police Chiefs’ Council cybercrime program, said more training is being given to police officers on a variety of crypto-related crimes. He said police are also looking at ways to inform the public about the need to be cautious when accessing a crypto account.

“You wouldn’t walk down the street holding £50 notes and counting them. That should apply to people with crypto assets,” he said.

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Topics: Cybercrime

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