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A Nebraska man faces 30 years in prison in connection with a major cryptojacking scheme.
According to a report dated April 15 accusation of the U.S. Attorney's office in Brooklyn, Charles O. Parks III, also known as “CP3O,” has been charged with defrauding two prominent cloud service providers.
Cryptojacking is a cyberattack in which attackers illegally “hijack” the victim's system and mine cryptocurrency using its resources, such as processing power or electricity. The attack is executed in a variety of ways and, in most cases, is not detected by the victim's system until it is too late.
Parks allegedly stole $3.5 in computing resources offered by service providers. The resources were then used to mine cryptocurrencies worth $970,000. The full list of charges includes “wire fraud, money laundering, and engaging in illegal monetary transactions in connection with the scheme.”
The defendant was arrested on April 13, 2024 and the case is being handled by the United States Attorney for the Eastern District of New York, the Federal Bureau of Investigation and the New York City Police Department (NYPD). Park is due to appear in federal court in Omaha on April 16.
“Criminals are increasingly adept at manipulating digital tools and hiding behind advanced technology, often causing significant financial damage to their victims. “The FBI is committed to aggressively pursuing those who attempt to develop innovative techniques to commit crimes,” said FBI Assistant Director in Charge Smith.
Park's scheme was active from January 2021 to August 2021. During that period, he created multiple accounts with the cloud service providers (plaintiffs) using various business names he created, such as “MultiMillionaire LLC” and “CP3O LLC.” . He then used these accounts to access significant amounts of computer processing power and storage space, for which he never paid.
Additionally, Park managed to trick plaintiffs into offering him elevated access to his services. Using the resources, he mined multiple cryptocurrencies including Ether (eth), Litecoin (LTC), and Monero (XMR). He was also accused of deflecting queries over questionable data usage and deferring invoices.
Prosecutors added that Park laundered the funds through multiple cryptocurrency exchanges, an nft marketplace, and traditional bank accounts. The transactions were also structured in a manner that avoids exceeding the $10,000 federal reporting threshold.
He used the illicit funds for personal gain, including the purchase of a “Mercedes Benz luxury car, jewelry, and first-class travel and hotel expenses.” If he is convicted, he is expected to face a maximum of 20 years in prison for wire fraud and 10 years for illegal transaction charges.
Another notable case of cryptojacking in 2024 is that of a 29-year-old man who illegally mined cryptocurrencies through one million virtual servers. The defendant was arrested in January 2024 by the Ukrainian National Police, alleging that more than $2 million worth of cryptocurrency was mined.
