Monday, September 25, 2023

The FBI seizes $100,000 in NFTs from scammer after ZachXBT investigation


The FBI has seized 86.5 ether (ETH) and two non-fungible tokens (NFTs) worth over $100,000 from a reported phishing scammer.

The alleged scammer in question, Chase Senecal – known as Horror (HZ) online – was initially exposed through a lengthy investigation by independent blockchain investigator ZachXBT. to publish Again in September 2022.

The official FBI notification is on February 3. 3 explained that Seneca’s property—including a $41,000 Audemars Piguet royal oak watch—was “confiscated for federal forfeiture for violating federal law.”

The FBI notification didn’t give much other information about the ordeal except to indicate that all of the property had been seized in October. 24, 2022. The seized NFTs included Bored Ape Yacht Club #9658 and Doodle #3114, valued at $95,495 and $9,361 respectively, at the time of their seizure.

86.5 ETH was valued at $116,433 at the time of the grab but is now worth $144,000.

It is not clear what the full scope of legal action has been taken against Senecal at this point. However, according to the FBI’s Law Enforcement Bulletin, a federal forfeiture is a law enforcement tool that enables the government to “remove—without compensation to the individual—ownership of property implicated in a crime.”

“It may happen in a civil proceeding, such as a lawsuit against the racist, or after an individual has been convicted in a criminal trial,” says the FBI.

While the FBI has yet to come out with an official tip of the hat to ZachXBT, the on-chain investigator noted via Twitter on February 3. 3 that the seizure of property “came as a result” of his investigation.

“I look forward to seeing more phishing scammers suffer a similar fate in the future to hurt many people in this space,” ZachXBT wrote.

With the Ape Ape NFT hack, people in the community joked that the FBI would change his profile picture to Ape #9658.

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Photohopped FBI profile pic: @CryptoWithNick on Twitter

Notably, the sparkling watch was one of the key identifiers that helped ZachXBT uncover Senecal’s identity and chain activity during the investigation.

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In a Medium post from Sept. On February 2, 2022, ZachXBT explained that after seeing HZ showing off the new watch on social media, he asked “about a few mutual friends who sell watches” and was eventually able to contact the person who sold that specific AP watch to Senecal.

Unfortunately for Senecal, the payment was said to have been made on the blockchain by using USD Coin (USDC).

The address HZ used to pay the watch seller $47.5k was directly funded by multiple addresses being used to scam people using hacked Twitter accounts such as @deekaymotion, @Zeneca_33, @ezu_xyz and [and] JRNYclub, ZachXBT Books.

This isn’t the first time ZachXBT’s research has played a major role in helping government authorities. In October 2022, the French National Cyber ​​Unit cited ZachXBT’s work in helping it catch a group of alleged scammers suspected of stealing $2.5 million worth of NFTs via phishing scams.