Turkish Police score a hit on Crypto wallet hacking scam

  • By Tom Cleveland

  • November 16, 2018
  • 3:03 am BST

Fraud never sleeps, but if you stay awake long enough, especially in the cyber world, then you might catch a thief at his own game. It came as good news to hear that Turkish Police officials had arrested eleven individuals in connection with an alleged hacking scheme. A major Turkish newspaper, Hürriyet, reported Friday that the Cybercrime Department of the Turkish National Police had reacted quickly to 14 consumer complaints involving $80,000 in losses. The crooks had managed to transfer Bitcoins from wallet accounts, after they had allegedly compromised private login information.

Law enforcement officials conducted several raids by zeroing in on new SIM card registrations on existing crypto exchange accounts. The hackers had set up a network of multiple accounts to obscure the audit trail before selling the coins for Turkish Lira. Surveillance cameras at bank ATM machines also helped catch the thieves in the act. The paper went on to report that, “The investigation is ongoing, with policemen looking for more victims of the hackers.”


Turkish investors and consumers, in general, have recently become very interested in “safe havens” for their national currency. Turkey has been in the news of late as just one of many examples of emerging market countries that have had to endure capital flight. When foreign investors withdraw their support for local investment projects due to a depreciating local currency, they quite often move their capital cross-border. These movements then weaken the local currency even more. The Turkish Lira has fallen over 50 percent during 2018 due to this type of capital flight.


Unfortunately, many unsuspecting consumers, who were new to cryptocurrencies, were unaware of the pitfalls of losing security keys and private credentials for accounts with local exchanges. There have been a rash of compromises across the globe tied back to swapping SIM cards in cell phones that do not have the necessary safety precautions. This particular scam is referred to as “SIM Swapping” and can happen if your phone is stolen or accessed with the right technology. Millions in recorded losses have already been reported in various jurisdictions.


In any event, it is refreshing to hear of an incident where the local police were able to use cyber technology to defeat a scam in progress. The lesson, however, is a simple one. Be very careful where you install your crypto account access keys, especially on smartphones that can be compromised without your knowledge. You must also be careful of visiting suspicious websites online, since links may take you to a criminal server that will install malware on your computer. Do not be tempted by suspicious links or emails that suggest that you must login to your account to verify your identity. Today’s malware reports keystrokes back to the crooks, where further research can reveal your private login information.