Operation Reaches Out to Compromised Ethereum Wallet Holders, Offering Assistance Regardless of Prior Losses
In a joint effort, forensic analysts from the U.S. Secret Service and Canadian law enforcement agencies have successfully disrupted a $4.3 million “approval phishing” scheme targeting users of Ethereum wallets.
International Collaboration Targets Sophisticated Crypto Scam
These deceptive attacks involve tricking individuals into authorizing transactions that grant malicious actors the ability to spend or drain cryptocurrency tokens from their wallets.
This type of scam is often employed in conjunction with romance scams, sometimes referred to as “pig butchering” scams, where emotional manipulation is used to extract financial gains.
Operation Avalanche Aims to Protect and Assist Victims
Dubbed “Operation Avalanche,” this joint initiative (distinct from the Avalanche layer-1 network and its AVAX token) involved a comprehensive search for Ethereum wallets compromised by these scams.
Law enforcement officials proactively contacted wallet owners who had been impacted, offering support and guidance to both those who had already suffered financial losses and those identified as being at risk of future attacks.
Broad Coalition of Agencies Involved in Multi-Jurisdictional Effort
The operation was spearheaded by the U.S. Secret Service and the British Columbia Securities Commission.
It benefited from the collaboration and resources of numerous agencies, including the Ontario Provincial Police, the Alberta Securities Commission, L’Autorité des marchés financiers (Québec), the Ontario Securities Commission, the Delta Police Department, the Vancouver Police Department, and the Royal Canadian Mounted Police.
The support network also extended to an undisclosed cryptocurrency exchange and a specialized blockchain analytics firm.
Commitment to Recovering Stolen Assets and Supporting Victims
Matt McCool, the Special Agent in Charge at the U.S. Secret Service’s Washington Field Office, emphasized his organization’s dedication to ongoing collaboration with Canadian law enforcement and financial partners.
He stated their commitment to “identify and seize stolen assets to return to victims,” demonstrating a proactive stance against crypto-related financial crimes.
Secret Service Intensifies Focus on Cryptocurrency Enforcement
This recent action underscores the increasing focus of the Secret Service on cryptocurrency-related crime.
In March, the agency played a key role in dismantling the website of Garantex, a Russian cryptocurrency exchange.
That previous operation, also a joint endeavor, cited Garantex’s connections to cybercriminal entities and sanctioned Russian financial institutions, particularly those linked to darknet ransomware groups.
“Approval Phishing” Remains a Major Threat in the Crypto Space
“Approval phishing” has become a consistently prevalent and highly damaging form of cryptocurrency scam.
Chainalysis, a blockchain analysis firm, estimates that approval phishing schemes lost a staggering $2.7 billion between May 2021 and July 2024.
Chainalysis further notes that the actual figure may be significantly higher, as many instances of these scams go unreported and undetected, highlighting the insidious nature and scale of this type of cybercrime within the cryptocurrency ecosystem.
Also Read: Canada Spearheads Crypto Innovation with Launch of Staking Solana ETFs
